China Guangzhou Shipyard International Co. Ltd (GSI)<600685><317>, the largest shipbuilder in southern China, expected a 15% drop in margins this year, sources cited Han Guangde, vice president and general manager of the company, as saying.
Han also revealed that the company has not received any cancellation of ship orders so far, therefore, it is able to fulfill its target of building 16 ships this year.
Higher steel price and wages were the main factors affecting GSI's margins. Zeng Xianxin, GSI's chief accountant, further disclosed at a press conference that the surging costs of steel and labor, which currently account for about up to 20% and 15% of total costs respectively, made it hard for the company to remain the margin growth same as last year's 20%.
The company's A- and H-shares closed at RMB 22.92 and HK$16.79 on Tuesday, down 3.86% and 4.7% respectively.
Han also revealed that the company has not received any cancellation of ship orders so far, therefore, it is able to fulfill its target of building 16 ships this year.
Higher steel price and wages were the main factors affecting GSI's margins. Zeng Xianxin, GSI's chief accountant, further disclosed at a press conference that the surging costs of steel and labor, which currently account for about up to 20% and 15% of total costs respectively, made it hard for the company to remain the margin growth same as last year's 20%.
The company's A- and H-shares closed at RMB 22.92 and HK$16.79 on Tuesday, down 3.86% and 4.7% respectively.