Yangzijiang Remains Profitable Amid Industry Turmoil

Yangzijiang Shipbuilding (Holdings) Limited (“Yangzijiang) one of PRC’s leading and most enterprising shipbuilder listed on the SGX Main Board, reported net profit attributable to shareholders of RMB 811.7 million for the three months ended 30 June 2013 ( 2Q 2013 ).

The Group’s overall revenue increased 12% to RMB4.4 billion in 2Q2013 from RMB3.9 billion in 2 Q2012. The Shipbuilding related segment remained as the Group’s core revenue driver, contributing about 91 % to the Group’s revenue in 2 Q 2 013 (2 Q2012 : 9 1 %).

This was mainly attributed to higher revenue recognition from the construction and delivery of large vessels during the quarter. Although the Group delivered 11 vessels to customers in 2Q2013 compared to 15 vessels in 2Q2012, 7 of these were large vessels. Other shipbuilding related business – which encompasses ship demolition, design services, and trading of ship supplies – generated RMB 389.3 million of revenue. Out of this amount, ship demolition contributed RMB197.8 million, compared to RMB123.2 million in 2Q2012.

The other shipbuilding related business generally generates lower gross profit margins compared to the core shipbuilding operations. Notwithstanding the prolonged downturn in the shipping industry, the Group continued to report healthy gross profit margins for the shipbuilding segment at 20.6 % (2Q2012: 24.2%). Higher interest income from the Investment segment lifted gross profit margins at the Group level to 27.4 % (2Q2012: 3 0.5 %).

2 Q2013 analysis

[mappress]
Press Release, August 7, 2013