Ports investor Cosco Pacific Ltd. said Thursday it is cutting capital expenditures and will stop looking at new port investments as it seeks to conserve cash during the global slump. Vice Chairman Xu Minjie told a news conference that Cosco Pacific's capital expenditure will fall to US$570 million in 2009 from US$890 million in 2008. Xu said Cosco Pacific believes new port investments are too risky in the current difficult operating environment, so it will focus on improving and developing ports in which it holds a controlling stake.
He also said the company plans to slow the progress of committed new port projects to meet the forecast decrease in demand this year.
"We expect the situation in 2009 to be even worse than in the fourth quarter of last year," said Cosco Pacific Chairman Chen Hongsheng.
He said the company's top priority under volatile market conditions is to maintain a healthy financial position and reduce risks. Cosco Pacific's cash on hand totaled US$429 million at the end of 2008, he said.
Cosco Pacific, a unit of China Cosco Holdings Co. (1919.HK), reported Wednesday a 36% decline in 2008 net profit to US$274.7 million because of one-off gains the previous year.
The company's core ports division contributed a profit of US$128.23 million in 2008, almost unchanged from the US$128.27 million a year earlier.
Cosco Pacific said a rise in container terminal capacity last year helped it maintain steady earnings despite the global economic downturn, which led to a slump in global trade.
Cosco Pacific has stakes in container terminals in mainland China, Hong Kong, Singapore, Belgium, Egypt and Greece.
He also said the company plans to slow the progress of committed new port projects to meet the forecast decrease in demand this year.
"We expect the situation in 2009 to be even worse than in the fourth quarter of last year," said Cosco Pacific Chairman Chen Hongsheng.
He said the company's top priority under volatile market conditions is to maintain a healthy financial position and reduce risks. Cosco Pacific's cash on hand totaled US$429 million at the end of 2008, he said.
Cosco Pacific, a unit of China Cosco Holdings Co. (1919.HK), reported Wednesday a 36% decline in 2008 net profit to US$274.7 million because of one-off gains the previous year.
The company's core ports division contributed a profit of US$128.23 million in 2008, almost unchanged from the US$128.27 million a year earlier.
Cosco Pacific said a rise in container terminal capacity last year helped it maintain steady earnings despite the global economic downturn, which led to a slump in global trade.
Cosco Pacific has stakes in container terminals in mainland China, Hong Kong, Singapore, Belgium, Egypt and Greece.