Sinotrans’ First Half Loss Widens
- Business & Finance
As the global economy dragged forward in uncertainty and instability during the first half of 2016, the Hong Kong-listed Sinotrans Shipping Limited reported its loss widened to USD 40.2 million in the first half of the year compared to a loss of USD 18.2 million seen in the same period a year earlier.
Sinotrans’ operating loss for the period stood at USD 46.3 million, against an operating loss of USD 30.9 million reported in the corresponding period in 2015.
The company saw its revenues for the first half of 2016 drop to USD 385.8 million from USD 485.1 million seen in the same period of 2015. Revenues from dry bulk shipping operations plunged to USD 161.9 million from USD 246.9 million, while the container shipping revenues also decreased to USD 223.2 million from USD 236.6 million.
“The balance between supply and demand kept tilting under the context of sluggish world trade growth caused by depressed overall demand on one side and increasing fleet capacities on the other side,” the company said.
“The international shipping market has further depressed compared to 2015, evidenced by the unprecedented historical low market index of dry bulk shipping market and container shipping market.”
The overall dry bulk market remained weak in the first half of 2016. Despite a rebound in prices of major commodities in the second quarter of the year, it was still trading low, and the global trade continued to be stagnated.
The shipping volume was 20.47 million tons during the first half year, against last year’s 20.97 million tons, while the average daily charter hire rate/time charter equivalent (TCE) rate of dry bulk vessels dropped to USD 4,947 from USD 8,122 seen in the same period a year earlier.
In the first half of 2016, the company continued to optimize the fleet structure and accelerated fleet upgrade by scrapping 5 aged vessels, and receiving 3 Handymax eco-vessels. Sinotrans has an orderbook of 11 vessels, of which 1 Handymax vessel is expected to be delivered in the second half of the year, 6 Handysize bulk vessels and 4 container vessels are expected to be delivered from 2017.