AP Møller-Maersk will focus on strengthening its oil, drilling rigs and port operations business over the next five years, says Group CEO
AP Møller-Maersk will switch its investment focus from shipping to its oil, drilling rigs and port operations business over the next five years, says Group CEO Nils Andersen.
“We will move away from the shipping side of things and go towards the higher profit generators and more stable businesses,” Anderson told the Financial Times.
“We are not going to invest significant amounts in Maersk Line. We have sufficient capacity to grow in line with the market.”
Over the next fiver years, the Danish oil and shipping group will reduce the capital tied up in Maersk Line from 30 percent to 25 percent.
“When we have taken that shift, probably more than 50 percent of our capital will be tied in these three other businesses,” added Anderson.
Maersk Line, like much of the shipping industry, has struggled with profitability following the global economic slowdown and overcapacity on world trades. In response, Maersk and other lines have increased rates and introduced cost saving measures. Maesrk Line, following four successive periods of losses, posted profits of US$498 million in the third quarter of this year.
However, Anderson warned earlier this month that the recent signs of recovery and the rebound of container rates could be short-lived with industry overcapacity still of major concern for all shipping lines.