Maersk profit sinks amid Brazil deepwater woes

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Wednesday, February 10, 2016

Asset write-downs in Brazil contributed to AP Moller-Maersk's US$2.5bn loss in the fourth quarter, the Danish shipping and energy conglomerate said on Wednesday.

In an earnings statement, the Copenhagen-based company said underlying profit for 2015 was US$3.1bn compared to US$4.5bn a year earlier.

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It warned this year's result could be "significantly below" the 2015 figure due to a need for an oil price of US$45-55/b to break even. International benchmark Brent crude was trading at US$30.79/b on Wednesday.

Maersk said it booked impairment charges of US$80m in Q2 and US$2.5bn in Q4 due to its underperforming operations.

The company said it was impacted by "production assets with a short lifetime", in Kazakhstan, Kurdistan and the UK" in addition to adverse conditions for deepwater fields in Angola and Brazil.

Efforts are being made to extend licenses for Brazil's Wahoo and Itaipu areas, which expired in the fourth quarter, Maersk added.

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