Maersk Tankers emerges from 2015 with its best result in many years. Increasing rates and results from the Taking Lead Strategy mean that Maersk Tankers has achieved an underlying result of USD 156 m, USD 150 m of which came from the product tanker segment, which Maersk Tankers chose to focus on a couple of years ago.
Maersk Tankers leaves 2015 with a highly satisfying result of USD 160 m (USD 132 m in 2014) and a return on invested capital of 9.9% (6.8% in 2014).
The underlying result for 2015 is USD 156 m, against an underlying result of USD 138 m in 2014, of which USD 28 m were lost on the product tanker segment. The profit in 2014 could be attributed to the larger VLCC vessels, which Maersk Tankers sold off during 2014, including the reversal of provision for onerous contracts of USD 87 m. Maersk Tankers has found it difficult to deliver satisfactory results for several years due to very low rates in the market.
This meant that, a couple of years ago, Maersk Tankers chose to focus on the product tanker market, through which Maersk Tankers expects to be able to achieve the best earnings in the long-term, for example due to the refineries moving closer to the oil wells. The focus on the product tanker market, as well as on improved earnings, is the basis of the Taking Lead Strategy, which was launched in the summer of 2014.
The rates in the product tanker segment began to increase as early as late 2014, and even earlier in the VLCC market. The increasing rates, along with the results of the Taking Lead Strategy, mean that Maersk Tankers has achieved its best result in many years, USD 21 m of which can be attributed to improvements achieved through the initiatives from the Taking Lead Strategy, which comprises three main elements:
Cost Leadership, where the focus is on optimising costs connected to fleet operations/Daily Running Cost
Active Position Taking, where Maersk Tankers will strengthen the planning of vessel positioning through increased data use, which will mean that Maersk tankers will have a greater chance of getting the most profitable loads
3rd party Services, which is an expansion of Maersk Tankers’ pools with more external vessels.
”It is highly satisfying that just one full year after launching our strategy “Taking Lead”, we are able to achieve such a good result. The result is of course helped by a significant increase in rates, but even after just one year, we can already see some good results from our strategy,” says Morten H. Engelstoft, CEO for Maersk Tankers. The rates in the product tanker segment have increased to index 164. Our expectations for the rates are positive. This means that we do not expect the rates to get as low as that seen in the last 5-6 years. We will continue to see a lot of volatility in the market. The development in rates is generally positively affected by the low oil prices.
”With our Taking Lead Strategy, we are focusing in particular on reducing our daily operational costs, but also on predicting the development in the rates, where there is great variation between the geographical markets. In addition, we have a goal to expand our pool cooperation, primarily with shipowners who don’t themselves have an organization to handle the operation of their vessels. By expanding our fleet over the next couple of years, we and our pool partners can benefit from our strong operational capabilities – including some of the synergies that can be gained from being part of the world’s largest tanker company,” says Morten H. Engelstoft.
”We are therefore on a voyage where we will be in a much better position to be able to handle the very volatile market in which we find ourselves. Of course there is always a risk that the rates will at some point drop to a very low level again, but we can already see that, with our strategy, we are in a much stronger position than we were previously,” concludes Morten H. Engelstoft. Maersk Tankers owns and operates a large fleet of product tankers – all built and operated in accordance with the highest standards for quality and reliability.
We acquired our first dedicated tanker in 1928, and we’ve been expanding and improving our fleet to meet changing customer needs ever since. Today, the Maersk Tankers fleet is one of the largest product tanker fleets in the world.