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Further job cuts by Maersk

Further job cuts by Maersk
Chief executive Nils Smedegaard Andersen said more firings are inevitable this year along with further operational restructuring.

Chief executive Nils Smedegaard Andersen said more firings are inevitable this year along with further operational restructuring.

Despite posting annual earnings of 17.6 billion kroner for 2008, shipping giant A.P. Moller-Maersk"s earnings are being dragged down by some of its struggling companies resulting in major cuts being forecast for 2009, reports Berlingske Tidende newspaper. Last year the company let more than 4,500 employees go under its so called "StreamLINE" plan, initiated by chief executive Nils Smedegaard Andersen.

Andersen said more firings are inevitable this year, along with further operational restructuring.

Maersk"s container company, Maersk Line, is one area that has taken the brunt of the reorganisation. The company earned a profit of 1.1 billion kroner in 2008, but it has experienced increasing losses during the financial crisis and will likely end up in the red this year.

"We"re stepping up the streamlining process which has been going on for some time," said Andersen. "We"re basically finished with cuts in Maersk Line but are now looking at other operations that need improvement, so more job cuts are in line."

Maersk suffered huge losses through its bank investments last year and its available cash flow went from 22 billion kroner in 2007 to 13 billion by the end of 2008.

Analysts believe Maersk will face a tough 2009, with Maersk Line suffering significant losses, and profits from Maersk Oil and Gas - the company"s biggest earner in 2008 - dropping sharply.

But despite its falling profits and stocks that fell around 10 percent after the announcement of its annual report on Thursday, Maersk is still a healthy company, according to Andersen.

"I think it"s healthy that you run into a wall now and then," he said. "But it"s all about not being overconfident."

Besides Maersk Line and Maersk Oil and Gas, A.P. Moller-Maersk also owns shipbuilder Lindø, container operator APM Terminals and majority shares in supermarket chain operator Danske Supermarked.

www.TurkishMaritime.com.tr

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