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The world's largest container shipping company A.P. Moller-Maersk A/S Friday posted a smaller-than-expected drop in first-quarter net profit, supported by increased freight rates and efficiency measures at its main shipping unit, but said it expects container transport demand to remain subdued this year amid "challenging" conditions.
Last year's earnings were boosted by the settlement of a tax dispute in Algeria.
The Danish shipping and oil conglomerate said it is maintaining its full-year guidance, expecting a result for 2013 below that of 2012 of $4 billion, while the net result excluding exceptionals is expected to be in line with the 2012 figure of $2.9 billion.
"Global demand for seaborne containers is expected to increase by 2%-4% in 2013, lower on the Asia-Europe trades but supported by higher growth for imports to emerging economies," the company said.
Indications for the first quarter of 2013 "show modest improvements in the global demand for container transport, reflecting the weak economic situation, especially in developed countries."
"Demand is expected to stay subdued in 2013 while capacity will grow significantly. Accordingly, conditions for the container industry remain challenging and managing supply will be even more important this year," it said.
The company posted a first-quarter net profit of 4.01 billion Danish kroner ($693 million), beating analyst expectations of DKK3.4 billion. In the year-earlier period, the company recorded a net of DKK6.15 billion.
Revenue was lower than expected, dipping 2% to DKK79.32 billion, from DKK81.31 billion in the year-ago period. Analysts had forecast revenue of DKK82.32 billion.
Copyright (c) 2013 Dow Jones & Company, Inc.
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