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Sinotrans shines in dark shipping industry times
2009/3/12
SINOTRANS Shipping Limited and its subsidiaries have announced that revenue for the 2008 calendar year from container shipping was approximately US$18.0 million, an increase of 69.5 per cent when compared with last year.
The increase was primarily due to the growth in capacity by 3,388 TEU through the addition of four new container vessels that were delivered and commenced operations during the year. The average daily charter hire rate increased from US$6,227 in 2007 to US$6,498 in 2008, the company said in a statement.
This comes as the group''s profit in 2008 surged by 146.4 per cent compared to the previous year to $347.1 million on the back of total revenue of $456.0 million, up 50.9 per cent
Operating Profit for 2008 amounted to $285.5 million, an increase of 112.3 per cent year on year. Net profit margin rose by 63.3 per cent to 76.1 per cent.
The group attributed the increase in profit and revenue in 2008 to the "remarkable growth in the group''s dry bulk shipping business in the first three quarters of 2008 and gains on the disposal of three single-hull Very Large Crude Oil Carriers ("VLCC"s) (including one jointly owned VLCC) at a good time of the market," a group release said.
Zhao Huxiang, Chairman of Sinotrans Shipping, said: "2008 was a volatile year for the shipping industry around the world. During the first three quarters of 2008, the global shipping demand for raw materials such as iron ore and coal was huge, driven in particular by growing demand in the China market, which boosted the shipping industry. This in turn brought remarkable growth to the group''s dry bulk shipping business during the period.
Entering the fourth quarter, as the economies of key developed nations and emerging markets were hard hit by the deepening of global financial crisis, the shipping industry also experienced unprecedented challenges. Despite the downturn, the group still achieved a year-on-year growth in the fourth quarter thanks to its strategy of flexibly combining long-term and short-term time chartering and keeping operating costs at relatively low levels."
With regard to the group''s outlook for 2009, "the international shipping market will face pressure both from decreasing international seaborne trade and rapid growth in tonnage. In light of diminishing market demand, the huge ship supply cannot be readily absorbed, and freight rates will remain at a low level. It is possible that freight rates will experience severe fluctuation within a certain period of time. The shipping industry will be under considerable pressure as a result," Mr Zhao said.
"However, with the rescue measures being imposed by various governments, in particular plans for stimulating domestic demand by the Chinese government gradually taking effect, both the global and Chinese economy and trade will be benefited, thus providing stimulus to the shipping industry. The recent cancellation or postponement of delivery of certain newbuilding orders and the accelerated rate of scrapping of aged vessels will relieve partially the supply pressure in the market, and contribute positively to the business development of the group," he added.
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2009/3/12