Maersk Post

August 2015 Edition

A digital magazine with stories about A.P. Moller Maersk businesses, employees worldwide. It includes articles, links and videos to learn more about Maersk and can be read everywhere on desktop and mobile devices.

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PORTFOLIO HIGHLIGHTS Maersk Line reported a profit of USD 507m (USD 547m) and an underlying profit of USD 499m (USD 543m). Despite a sharp de cline in the average freight rate of 14%, Maersk Line delivered a 10.1% (10.8%) ROIC based on its cost leadership strategy. Maersk Line signed a contract for the delivery of 11 second gener ation Triple-E vessels with a capaci of 19,630 TEU each and with an option for six vessels more, at the beginning of June. Delivery is scheduled to take place in 2017-18. Maersk Oil made a profit of USD 137m (loss of USD 1.4bn, ad versely impacted by USD 1.7bn impairment on Brazilian assets) with an underlying profit of USD 217m (USD 315m). ROIC was 9.2% (nega- tive 96.6%). e entitlement production increased by 30% to 306,000 boepd (235,000 boepd) at a 44% lower average oil price of USD 62 per barrel. e increased production was a result of a higher share of production from Qatar due to the lower oil price as well as improved opera- tional performance and production from new projects, in particular in the UK. As a response to the lower oil price, Maersk Oil has initiated a number of activities to improve profitabili and position Maersk Oil for growth. Maersk Oil expects that the net operating costs excluding exploration will have been reduced by 10% at the end of 2015 compared to the 2014 baseline. is is in line with the targeted 20% reduction by the end of 2016. APM Terminals delivered a profit of USD 161m (USD 223m) and a ROIC of 10.9% (14.2%). e under- lying profit was USD 159m (USD 211m). e result was negatively impacted by a revenue reduction of 8.6% caused by decreased volumes in key oil de pendent markets as well as divestments in 2014 and a weakening of local currencies against the USD resulting in lower revenue in USD terms. Maersk Drilling delivered a profit of USD 218m (USD 117m) gen erating a ROIC of 10.6% (7.2%), positively impacted by general cost savings, fleet growth and an additional gain of USD 29m relating to the divestment of Maersk Drilling's activities in Venezuela in 2014, but partly offset by three rigs off contract. e underlying profit was USD 189m (USD 117m). APM Shipping Services made a profit of USD 138m (USD 30m) and a ROIC of 11.8% (2.1%). e underlying profit was USD 109m (USD 27m). Q2 Q2 FY (USD million) 2015 2014 Change 2014 Maersk Line Revenue 6,263 6,902 -9.2% 27,351 Reported profit 507 547 -7.3% 2,341 Operating cash flow 873 870 0.3% 4,119 Volume (FFE '000) 2,484 2,396 3.7% 9,442 Rate (USD/FFE) 2,261 2,634 -14% 2,630 Bunker (USD/tonne) 335 579 -42% 562 ROIC (%) 10.1 10.8 -0.7pp 11.6 Maersk Oil Revenue 1,583 2,272 -30% 8,737 Reported profit 137 -1,397 N/A -861 Operating cash flow 611 718 -15% 2,594 Prod. (boepd '000) 306 235 30% 251 Brent (USD per barrel) 62 110 -44% 99 ROIC (%) 9.2 -96.6 N/A -15.2 APM Terminals Revenue 1,033 1,130 -8.6% 4,455 Reported profit 161 223 -28% 900 Operating cash flow 176 192 -8.3% 925 roughput (TEU m) 9.2 9.8 -6% 38.3 ROIC (%) 10.9 14.2 -3.3pp 14.7 Maersk Drilling Revenue 624 465 34% 2,102 Reported profit 218 117 86% 478 Operating cash flow 248 173 43% 701 ROIC (%) 10.6 7.2 3.4pp 7.1 APM Shipping Services Revenue 1,234 1,456 -15% 5,926 Reported profit 138 30 360% -230 Operating cash flow 193 111 74% 590 ROIC (%) 11.8 2.1 9.7pp -4.2 For more details regarding the financials for Q2 2015 please visit the Investor Relations web site: http://investor.maersk.com/financials.cfm Unless otherwise stated, all figures in brackets refer to the corresponding figures for the same period of the previous year. Guidance for 2015 The Group's expectation of an underlying result around USD 4.0bn is unchanged. Gross cash flow used for capital expendi- ture is now expected to be around USD 8bn in 2015 (USD 8.7bn) from previously around USD 9bn, while cash flow from operat- ing activities is still expected to develop in line with the result. e Group's guidance for 2015 is subject to considerable uncer- tain, not least due to developments in the global economy, the container freight rates and the oil price. PAGE 47 | AUGUST 2015 MAERSK POST

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