Maersk Says June Cyberattack Will Cost It up to $300 Million
Maersk Line
A.P.
Moller-Maersk A/S said a cyberattack that hit the owner of the world’s
biggest container shipping company at the end of June will wipe as much
as $300 million off profits in the third quarter.
The announcement was made in connection with
second-quarter earnings, which showed Maersk missed analyst estimates
after taking a writedown at the tankers unit that’s part of the energy
business management has said it wants to get rid of.
In an interview with Bloomberg Television, CEO Soren Skou
said the industry outlook was bright, despite the disruptions of
cyberattacks and writedowns. Management at the Danish company sees “very
healthy fundamentals” for container shipping, Skou told Bloomberg’s
Matt Miller and Guy Johnson.
Frode Morkedal, the managing director of Clarksons Platou
Securities, said the report was “slightly on the negative side, but we
find solace in their positive market comments,” in a note to clients. Of
the 31 Maersk analysts tracked by Bloomberg, 15 are telling investors
to buy the stock, 12 suggest holding on to it, and four say clients are
better off selling.
David Kerstens, an equity analyst at Jefferies, said the
fact that Maersk Line reported its first profit in five quarters shows
that “fundamentals in container shipping continue to improve,” according
to a note. Kerstens is among analysts advising clients to buy.
Clarksons has a neutral rating on the share.
• Earnings before interest and taxes was $302 million in
the second quarter, missing the average estimate of $896 million in a
Bloomberg survey of 10 analysts.
• Maersk had a net loss of $269 million, when analysts had expected a profit.
• Revenue was $9.60 billion, in line with estimates.
• The June cyberattack will cut about $200-300 million off Maersk’s results, it said.
• The company kept its outlook for the full year.
Profit was hurt by a $732 million impairment due to lower
asset valuations in Maersk Tankers and “a few commercially challenged”
terminals in the APM unit, it said
Maersk was among a number of multinational companies that in June was hit by a cyberattack.
Its IT systems were disabled, preventing the shipping line from taking
new orders for several days. Maersk said on Aug. 16 it kept its outlook
despite the costs of the cyberattack, as the container shipping market
improves.
“These system shutdowns resulted in significant business
interruption during the shutdown period,” Maersk said in the report. The
financial impact in the second quarter was “limited,” but “the impact
in the third quarter is larger, due to temporary lost revenue in July,”
it said. “While the businesses were significantly affected by this
cyberattack, no data breach or data loss to third-parties has occurred.”
Aside from the cyberattack, Maersk said the industry
outlook was healthy. After a decade dominated by overcapacity, the
container industry is now benefiting from higher freight rates as some
of the biggest companies swallow up smaller rivals.
Skou also said stronger global economic growth means container transport is now “doing quite well.”
Maersk said “the improvement in market fundamentals in
past quarters has started to reflect in the freight rate,” which it said
was up 22% from a year earlier. Freight rates increased by 36% on
East-West trades and 17% on North-South trades, it said.
The company has given itself until the end of 2018 to come
up with a plan to separate its energy business, which includes Maersk
Oil and Maersk Drilling. The conglomerate wants to focus on its
transport division, which, besides Maersk Line, includes port operator
APM Terminals.
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