531227_omslag.qxp 30-03-2005 14:43 Side 3 A.P. Møller - Mærsk A/S Annual Report 2004 A.P. A.P. Møller - Mærsk A/S Annual Report 2004 531227_omslag.qxp 30-03-2005 14:43 Side 4 CONTENTS Page A.P. Møller - Mærsk A/S A.P. Moller - Maersk Group Managing Owner: Financial Highlights 3 Directors’ Report 5 Esplanaden 50 Container Shipping and Related Activities 10 DK-1098 Copenhagen K Tankers, Offshore and Tel. +45 33 63 33 63 other Shipping Activities 14 Oil and Gas Activities 18 Board of Directors: Retail Activity 22 Shipyards, other Industrial Michael Pram Rasmussen Companies, Aviation, IT, etc. 24 CHAIRMAN Financial Report 27 Poul J. Svanholm VICE-CHAIRMAN Directors’ Statement 31 Auditors’ Report 32 Ane Mærsk Mc-Kinney Uggla VICE-CHAIRMAN Accounting Policies 33 Lars Kann-Rasmussen Profit and Loss Account for 2004 37 Jan Leschly Assets at 31 December 2004 38 Liabilities at 31 December 2004 39 Leise Mærsk Mc-Kinney Møller Equity Statement 40 Svend-Aage Nielsen Cash Flow Statement for 2004 41 Jess Søderberg Notes to the annual accounts 2004 42 Jan Tøpholm Jens Erik Skovrider-Madsen A.P. Møller - Mærsk A/S Financial Highlights 55 Henrik Lorensen Solmer Profit and Loss Account for 2004 57 Assets at 31 December 2004 58 Audit Committee: Liabilities at 31 December 2004 59 Lars Kann-Rasmussen Equity Statement 60 CHAIRMAN Notes to the annual accounts 2004 61 Svend-Aage Nielsen Management duties in other Poul J. Svanholm Danish Limited Companies 69 Jan Tøpholm A.P. Moller - Maersk Group 70 Company overview 71 Remuneration Committee: Michael Pram Rasmussen CHAIRMAN Poul J. Svanholm Ane Mærsk Mc-Kinney Uggla Auditors: København • Søren Thorup Sørensen STATE AUTHOR. PUBLIC ACCOUNTANT Gert Fisker Tomczyk Schultz Grafisk STATE AUTHOR. PUBLIC ACCOUNTANT ANNUAL REPORT 2004 Forward-looking statements This Annual Report contains forward-looking statements regarding expectations for 2005. Such statements are subject to risks and uncertainties as various factors, many of which are beyond A.P.Møller - Mærsk A/S’ control, may cause actual development and results to differ materially from the expectations contained in the Annual Report. ___________ The Annual Report has been translated from Danish.The Danish text shall govern for all purposes and prevail in case of any discrepancy with the English version. Blank A.P. Moller - Maersk Group Financial Highlights Amounts in DKK millions 2004 2003 2002 2001 2000 Net revenue 165,962 157,112 151,579 150,633 140,714 Result before depreciation and write-downs, etc. 41,406 38,855 34,988 33,439 33,547 Depreciation, amortisation and write-downs, etc. 15,896 17,764 15,621 14,994 13,059 Gains on sale of undertakings, ships, rigs, etc. 4,013 655 723 1,394 1,040 Associated companies – share of result before tax 618 568 504 364 453 Financial items, net 129 - 359 - 1,642 - 2,624 - 2,553 Result before special items 30,270 21,955 18,952 17,579 19,428 Value adjustment of financial assets 3,233 2,518 - 1,872 - 683 5,942 Exchange rate adjustment of loans, etc. 140 2,149 3,474 - 1,284 - 1,689 Result before tax 33,643 26,622 20,554 15,612 23,681 Result for the year 24,352 17,273 12,058 8,457 15,970 Result for the year before special items, after tax 20,999 12,967 10,456 10,424 11,835 Total assets 193,936 173,034 170,578 169,598 164,932 Equity 114,261 92,188 77,230 66,878 61,216 Cash flow from operating activities 29,207 26,299 24,820 26,635 20,312 Cash flow used for investing activities 18,388 16,603 18,133 20,236 19,587 Net investments in tangible fixed assets 19,387 15,605 16,425 17,124 18,979 Return on equity 23.6% 20.4% 16.7% 13.2% 29.8% Equity ratio 58.9% 53.3% 45.3% 39.4% 37.1% Result per share, DKK 5,918 4,198 2,930 2,078 3,923 Cash flow from operating activities per share, DKK 7,098 6,392 6,032 6,544 4,990 Share price (B-share), end year DKK 45,268 42,403 23,835 25,055 30,559 Total market capitalisation, end year 185,369 170,106 95,228 97,400 118,034 Dividend per share, DKK 450 300 200 150 150 Goodwill related to acquisitions before 1 January 2002 has been written off against reserves in the year of acquisition. When calculating key figures “per share” the share capital resulting from the merger at 1 January 2003 has been applied for all years. In the calculation of result and cash flow per share and total market capitalisation, the Group’s holding of own shares has been excluded. 3 Blank 531227_uk_s4-26.qxp 30-03-2005 20:21 Side 5 A.P. Moller - Maersk Group Directors’ Report large number of loyal and new A shareholders took part in mak- ing the first Annual General Meeting after the merger a special and festive day. On the centenary of A.P. Moller - Maersk’s foundation on 16 April 1904, the general meeting was held in Svendborg where the Company was established. This made an occa- sion to pay tribute to Shipowner Mærsk Mc-Kinney Møller, who in December 2003 retired as Chairman and withdrew from the Board of Dir- ectors after 64 years of achievement. On 28 August 2004 the large con- tainer vessel ALBERT MÆRSK moored alongside the quay at Langelinie, The Annual General Meeting 2004 was held at Svendborg, where the Company was founded 100 years ago. Copenhagen. From its arrival the newbuilding from the Lindø Yard at- port of raw materials not only for A.P. Moller - Maersk contributed tracted great attention and interest, production, but also for investment actively in the international work on and more than 35,000 people went on in construction, infrastructure, en- securing the transport chain against board during the eight open days. It ergy supply, etc. Demand from the terrorism. Rules for vessels and ports was a particular pleasure for A.P. US continued at a high level and, re- have already been adopted by the Moller - Maersk that 15,000 share- gardless of the development of Eur- IMO (International Maritime Organ- holders and guests accepted the invi- ope’s economy being weaker, im- ization), among others, and imple- tation to a presentation of the vessel. ports from the East – including China mented sensibly, without delaying The wait that occurred when so many – have increased considerably. China or raising the cost of operations un- people had to board the vessel was took initiatives to moderate the reasonably. Containers are trans- accepted with patience and good growth. ported by ship, truck and train under spirits. the responsibility of different parties With regard to oil and gas, the agree- and are therefore difficult to secure Commercially, the year was also ment from 2003 with the Danish effectively. The USA is the driving characterised by many fortunate cir- Government for an extension of the force behind this security work and cumstances. The markets developed concession in the North Sea in return has shown great readiness to listen well; better than expected. The mari- for an increased government share, to the experience and advice of the time industry benefited from in- could finally be confirmed by the international container shipping com- creased demand as a result of the parties after the last reservations had panies. However, as there is no growth in international trade, which been withdrawn. The agreement, single body regulating international more than compensated for the sup- which extends A.P. Moller - Maersk’s container shipping, the industry it- ply of new vessels. At the same time, concession until 2042, took effect self also makes great efforts to demand for tonnage continued to in- from 1 January 2004. ensure uniform rules in the USA, crease. Europe and the Far East to avoid The decline in the USD exchange rate unnecessary obstacles to internation- One of the most essential forces be- against the Danish krone continued al trade. hind the positive growth in sea trans- and the average USD exchange rate port was the development in China, in 2004 was 9% under 2003 com- The EU Commission has long op- driven among other things by global pared with a decline of 16.5% the posed the possibility for shipping com- outsourcing. China’s export of goods year before. The decline has a nega- panies to co-operate in the so-called in containers by sea increased by al- tive effect, as most of the Group’s conferences. Several attempts to have most 20%, which required a large im- earnings are in USD. the shipping companies’ agreements 5 531227_uk_s4-26.qxp 30-03-2005 20:21 Side 6 declared contrary to the terms of the porary subsidies to shipbuilding to Operationally, A.P. Moller - Maersk treaty and to impose fines on them orders placed before March 2005 and works for protection and preserva- have been rejected by the EU Court with delivery no later than three years tion of the marine environment. For of Justice. The Commission now seeks thereafter. To ensure uniform condi- example, optimisation of equipment the support of the Member States to tions in Europe, the Government takes and procedures contributes to redu- abolish the special code of practice a positive attitude to the possibilities cing fuel consumption and emissions that came into force in 1986. In a con- for implementing the system in Den- of CO2, SO2 and NOx from vessels’ structive dialogue with the Commis- mark.