Maersk posts $2.68-B net loss in fourth quarter

A.P. Moller-Maersk A/S reported a $2.68 billion quarterly loss as the shipping giant continues to fight a vicious industry down-cycle, but executives said demand was recovering and the worst may be over.

The Danish conglomerate, which owns Maersk Line, the world's biggest container operator, said its fourth quarter results were hurt by $2.6 billion in asset impairments. Revenue fell 2.6% to $8.89 billion.

The company also said it would slice its annual dividend by half. Maersk shares closed down 5% in Copenhagen.

The result came as the group is trying to reshape itself into a global supplychain major like United Parcel Service Inc. and FedEx Corp. by integrating its transport and logistics units and spinning off its oil business.

The company booked impairments of $1.5 billion at its oil drilling unit and $1.1 billion at its supply-service business. Maersk took impairments of $2.5 billion on its oil assets in the same quarter a year earlier, when it reported a loss of $2.51 billion.

Also Wednesday, the company said Chairman Michael Pram Rasmussen, 62 years old, will step down on March 28 after 14 years at the helm of the board. He will be replaced by Jim Hagemann Snabe, 51, a former executive at tech giants SAP and Internatinal Business Machines Corp.

"IT plays an increasingly important role in the Maersk Group and in this area his competencies are among the very strongest," the company said.

People with knowledge of the matter said Mr. Snabe's priority is to help chief executive Soren Skou break up the company into two divisions focused on transport and energy. The company said last year it would split the business along those lines.

"It's probably the last year that Maersk will report earnings as a group, " one of the people said.

Container ships move 95% of manufactured goods – from designer dresses to heavy machinery. But during the past two years, freight rates have tumbled amid a capacity glut that prompted price wars among operators. (WSJ)