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A.P. Moller-Maersk Q3 Profit Rises, Backs Full-year Forecast

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Danish container shipping firm A.P. Moller-Maersk A/S (AMKAF.PK,AMKBF.PK) Tuesday said its third-quarter profit increased from the prior year, even as revenues improved only marginally. The company backed its full-year profit outlook, and raised forecast for its Maersk Line business.

Profit before tax rose to $2.50 billion from $1.96 billion in the same quarter last year. Profit attributable to the company rose to $1.47 billion from last year's $1.13 billion.

The latest results included $215 million after tax gains from divestment of APM Terminals Virginia, Portsmouth, USA as well as $73 million gain from Maersk Drilling divesting the activities in Venezuela. The results also included impairments in APM Terminals of $74 million.

The underlying profit for the group was $1.3 billion, flat with last year.

Revenue grew to $12.17 billion from $12.08 billion in the prior year, helped by higher container volumes and freight rates as well as higher oil entitlement production, partly offset by a lower average oil price.

For Maersk Line, profit rose to $685 million from $554 million, amid lower costs and increase in average freight rate. The division's volumes improved 3.7 percent from last year.

Maersk Oil's profit advanced to $222 million from $189 million, helped by a 4 percent growth in entitlement production and lower exploration costs.

Maersk Drilling made a profit of $192 million, up from last year's $148 million, including a gain of $73 million after tax due to divesting the Venezuela activities. Excluding the gain, the result was lower due to start-up of new rigs and maintenance.

Looking ahead, the Group still expects a result for 2014 significantly above $3.8 billion reported for 2013. The underlying result is still expected to be around $4.5 billion, excluding discontinued operations, impairment and divestment gains.

Further, the firm said that based on good quarterly performance, Maersk Line now expects a result for 2014 above $2 billion, compared to the previous projection of significantly above $1.5 billion earned in 2013. The global demand is now expected to grow by 3-5 percent, compared to the previous expectation for 4-5 percent growth.

The stock fell 2.6 percent in early trade in Copenhagen to 12,920 Danish kroner.

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