Equity Research Analyst, Maritime sector, Drewry Maritime Financial Research

Ankush Kathuria CFA, FRM

Equity Research Analyst, Maritime sector

Maritime Sector, Equity & Credit Research

Drewry Maritime Financial Research

With no ties to other players in the shipping, finance or banking world, we provide a uniquely impartial view of the markets and companies we cover. Our parent organization, Drewry is a leading independent provider of research services to the maritime and shipping industry, employing over 100 professionals across an international network of offices in London, Delhi, Singapore and Shanghai. Combining our market-leading resources with seasoned sector expertise DFRS offers a highly differentiated and comprehensive range of investment and financial research services to lenders and prospective investors in publicly listed maritime and shipping companies. The full service of reports, supporting resources and sector orientated webinars provides our clients with the most complete picture of the organisations under coverage as is possible. We have been charting and analysing the world’s maritime markets for more than 40 years. This unrivalled intelligence and understanding provides the foundation of our research service. Our analysts have access to one of the most up-to-date, comprehensive and reliable sources of market insight and research data available today. We look at globally listed companies within the following sectors: Port Operators, Container Shipping, Container Manufacturing & Leasing, LNG Shipping, Dry Bulk Shipping and Tanker Shipping. Combine in-depth sector expertise with financial analysis focusing on over 50 stocks globally.

Equity Bottom-Up

AP Moeller - Maersk A/S / Equity Bottom-Up

A.P. Møller - Mærsk A/S (MAERSKB DC) – 2Q16 Outlook Subdued; Maintain Unattractive<ul><li>
2Q16 outlook: APMM will release its 2Q16 results on 12 August 2016, and we expect Maersk Line to loose USD 57m (from a profit of USD 37m in 1Q) with a groupwide adjusted profit of USD 238m. We remain cautious for 2Q against the backdrop of deteriorating demand trends, and believe the recent news flow surrounding the loss of contract in Qatar Oil field and negative liner catalysts may impede upside progress. We have…</li></ul>

A.P. Møller - Mærsk A/S (MAERSKB DC) – 2Q16 Outlook Subdued; Maintain Unattractive
2Q16 outlook: APMM will release its 2Q16 results on 12 August 2016, and we expect Maersk Line to loose USD 57m (from a profit of USD 37m in 1Q) with a groupwide adjusted profit of USD 238m. We remain cautious for 2Q against the backdrop of deteriorating demand trends, and believe the recent news flow surrounding the loss of contract in Qatar Oil field and negative liner catalysts may impede upside progress. We have…

A.P. Møller - Mærsk A/S (MAERSKB DC) – 2Q16 Outlook Subdued; Maintain Unattractive

APMM has rallied close to 20% since the lows touched in early February as risk assets and oil complex rallied. We are sellers into the rally as the underlying fundamentals for mainstay container shipping has continued to deteriorate through the quarter. Spot rates are quoting virtually at a nadir and our channel checks suggest that contract rates have been signed at significantly lower levels than last year, severally undermining any prospects for Maersk line to return to profitability anytime soon. Operationally, Maersk line’s 4Q15 losses show that earnings have not only plateaued due to depressed freight rates, but also because cost optimisation (driven by low bunker prices) has outlived its utility. The path to profitability by cost cutting as a driver have seemingly run its course. With anaemic top line growth, challenges to profitability will only exacerbate. Basis of our bearish view on APMM is driven by Maersk Line losses ahead.

APMM has rallied close to 20% since the lows touched in early February as risk assets and oil complex rallied. We are sellers into the rally as the underlying fundamentals for mainstay container shipping has continued to deteriorate through the quarter. Spot rates are quoting virtually at a nadir and our channel checks suggest that contract rates have been signed at significantly lower levels than last year, severally undermining any prospects for Maersk line to return to profitability anytime soon. Operationally, Maersk line’s 4Q15 losses show that earnings have not only plateaued due to depressed freight rates, but also because cost optimisation (driven by low bunker prices) has outlived its utility. The path to profitability by cost cutting as a driver have seemingly run its course. With anaemic top line growth, challenges to profitability will only exacerbate. Basis of our bearish view on APMM is driven by Maersk Line losses ahead.

A.P. Møller - Mærsk A/S (MAERSKB DC) - Why We Are Turning Sellers of APMM?

AP MOELLER-MAERSK A/S-B (MAERSKB DC) - Diversification and Balance Sheet Provides Strong Cushion<img src="https://static-prod.smartkarma.com/images/media/000/005/417/original/APMM.JPG?1454552530" class="editor-image img-responsive" data-smartkarma-image-id="5417">• Fair Value under pressure amid sombre market outlook: We have our fair value of APMM at DKK 9,700 with a  Neutral rating. We have updated our forecasts to factor in management’s subdued guidance and new lows in oil prices. This results in lower group net profit as we assume a negative impact on three main businesses – Liner, Oil and Terminal. We forecast APMM’s net income to be in the range of USD…

AP MOELLER-MAERSK A/S-B (MAERSKB DC) - Diversification and Balance Sheet Provides Strong Cushion• Fair Value under pressure amid sombre market outlook: We have our fair value of APMM at DKK 9,700 with a  Neutral rating. We have updated our forecasts to factor in management’s subdued guidance and new lows in oil prices. This results in lower group net profit as we assume a negative impact on three main businesses – Liner, Oil and Terminal. We forecast APMM’s net income to be in the range of USD…

AP MOELLER-MAERSK A/S-B (MAERSKB DC) - Diversification and Balance Sheet Provides Strong Cushion

Denmark

A.P. Moeller-Maersk A/S is a conglomerate with diversified holdings. The Company operates a fleet including container vessels, tankers, supply ships, special vessels, APM terminials, and oil drilling rigs.  A.P. Moeller-Maersk also operates industrial business and explores for and produces oil and gas. The Company is active worldwide.

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AP Moeller - Maersk A/S (MAERSKB DC)

A.P. Møller - Mærsk A/S (MAERSKB DC) – 2Q16 Outlook Subdued; Maintain Unattractive

A.P. Møller - Mærsk A/S (MAERSKB DC) – 2Q16 Outlook Subdued; Maintain Unattractive 2Q16 outlook: APMM will release its 2Q16 results on 12 August...

Drewry Maritime Financial Research

A.P. Møller - Mærsk A/S (MAERSKB DC) - Why We Are Turning Sellers of APMM?

APMM has rallied close to 20% since the lows touched in early February as risk assets and oil complex rallied. We are sellers into the rally as the...

Drewry Maritime Financial Research

AP MOELLER-MAERSK A/S-B (MAERSKB DC) - Diversification and Balance Sheet Provides Strong Cushion

AP MOELLER-MAERSK A/S-B (MAERSKB DC) - Diversification and Balance Sheet Provides Strong Cushion• Fair Value under pressure amid sombre market...

Drewry Maritime Financial Research

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