ShippingWatch

Maersk Supply Service wants to double their profits

An ambitious plan for the Maersk Group’s offshore shipping company, Maersk Supply Service, for further boosting business following 3-4 years of massive growth. The goal is a doubling of profits to approximately USD 400 million.

The management of Maersk Supply Service has presented owner A.P. Moller-Maersk with a business plan involving the further addition of capital to the offshore company for investments in ships and equipment. According to Maersk Supply Service CEO Carsten Plougmann Andersen, the ambition is to double the profits, the so-called segment result, from the current level last year of USD 211 million.

“If we are to make USD 400 million within the next years, then we need to continue our investments, though not necessarily at the same rate as these past years,” Carsten Plougmann Andersen tells ShippingWatch, referring to the already high level of investments since 2008, when Maersk Supply Service was turned into an independent business unit. This happened as a result of considerations at the top level of A.P. Moller-Maersk concerning the future of Maersk Supply Service.

Instead, “asset management” at Esplanaden in Copenhagen has invested approximately USD 1.8 billion in the offshore shipping company unit over the last four years, resulting in the unit becoming one of the strategically important companies in the Maersk Group. When it comes to oil, the company is on par with Maersk Oil and Maersk Drilling.

The wish list

Carsten Plougmann stresses that the future investment program is a wish list, and that a growth of 50 percent over several years is probably more realistic, considering the state of the world, and in relation to the other business units of the Maersk group.

Maersk Supply Service has been supplied with 18 new ships since 2008. The total fleet of the company has an average age of about 13 years.

“The number shows that the old ships are very old, so when we sell some of the older, well run ships, the average can sometimes shift by half a year,” says Carsten Plougmann Andersen.

Brazil

Maersk Supply Service is also the Maersk Group company that has spent the longest time on the world’s most interesting offshore- and growth market, Brazil; 35 years, with the state owned oil company Petrobras by far the biggest client today. The Brazilian oil giant is responsible for almost 30 percent of the turnover of Maersk Supply Service, which currently has 23 vessels on contract in the Brazilian deepwater market.

The Maersk Supply Service fleet, which- compared to its growth, turnover and number of ships - is administered by a fairly small organization of 250 employees on land and 2000 at sea, is spread out all over the world today´, with 15 vessels in the North Sea, 14 by Africa, nine in Canada, six in the Far East and Australia, and 23 in Brazil.

In total, Maersk Supply Service has a market share of just two percent of the world market, but within its core segment – ships with more than 15,000 bhk – its market share is around 20 percent.

New vessels from Chile

Right now two new anchor handling vessels are under construction in Chile. The ships are planned to be inserted into the Canadian offshore market, where authorities require a 25 percent import tax on the market value of ships not built in Canada. That problem is solved through a free trade agreement between Chile and Canada.

“We have found a ship yard that provides quality construction and competitive prices. We have good experiences there, but the units are relatively expensive. For an anchor handler of approximately 15,000 bhk we are talking a USD 100 million investment per ship,” says Carsten Plougmann Andersen. 

More from ShippingWatch

Several factors explain the plummeting dry bulk rates

Dry bulk rates have taken an unusual dive at the beginning of 2022. Most recently, the Baltic Dry Index dipped by 4 percent Friday. Several factors have triggered a ”panic in the market,” an analyst explains to ShippingWatch.

Latest news

See all jobs