COPENHAGEN (AFX) - AP Moeller-Maersk AS said its net profit for the full-year 2006 will be 40 pct lower than the 20.2 bln dkr posted in 2005.
It also sees sales of 270 bln dkr in 2006, up from 209 bln dkr a year ago.
The group said the changed forecast results from a number of factors that have changed since the annual report for 2005 was published in March.
At that time, the group said full-year net profit would be 10-15 pct lower than in 2005.
The group's Maersk Line has not obtained the anticipated share of the general market growth during the first half year of 2006.
It added that increased bunker costs and further reductions in the average freight rates have had a negative impact.
The earnings for the container business before depreciation will consequently be considerably below the March expectations and unsatisfactory.
The other shipping and offshore segments are as a whole performing as expected, it added.
For the oil and gas activities, AP Moeller-Maersk said the higher oil prices mean an estimated increase in the earnings, compared to the March expectations.
In addition, the group has revised the depreciation periods for vessels and rigs, which will be extended to 20 years, and for containers, which will be extended to 12 years.
These depreciation periods will be in line with conservative practice within the shipping industry, it added.
As a consequence of the above factors, the group's expectations for the net result for the year are changed.
Without the effect from the changed depreciation periods, it now sees a net result for 2006 in the order of 40 pct lower than the 2005 result, which was 20.2 bln dkr.
The group added that the new estimate is still sensitive to changes in freight rates and volumes, especially in Maersk Line, as well as changes in oil prices and currency rates. michael.delaine@afxnews.com mdl/joy COPYRIGHT Copyright AFX News Limited 2005. All rights reserved. The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News. AFX News and AFX Financial News Logo are registered trademarks of AFX News Limited
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