Jinhui Shipping Predicts Bad Fortune for 2015 Results
- Business & Finance
Due to record-low freight rates in the dry bulk shipping market, the Hong Kong-based marine transportation company Jinhui Shipping and Transportation Limited expects to record a wider net loss for the fourth quarter and year ended 31 December 2015, compared to a year earlier.
“Year 2015 was another tough year for dry bulk shipping market, with drastic confidence crisis in the final quarter stimulated by the reverse of the U.S. interest rate cycle marking the end of the quantitative easing era, the deeper than expected slowdown of the China’s economic growth, ambiguous currency policies, and a meltdown in commodities prices from metals to oil all occurring in a synchronized manner,” Ng Siu Fai, Jinhui Chairman said in a statement.
The company said that the expected net loss for the fourth quarter of 2015, would be largely attributable to the substantial impairment loss on certain owned vessels, while the net loss for 2015, would be due to the combined effect of the impairment loss on certain owned vessels, the weak spot freight market, and the abrupt correction of global stock markets in late 2015 which caused a net loss of approximately USD 19 million on the company’s investments.
According to Jinhui, the net loss included both realized loss on trading transactions and unrealized fair value loss on these securities instruments and would have a negative impact to the consolidated operating results for 2015. The company does not expect the market situation to improve any time soon.