China Shipping Container Lines’ profit down 76%
China Shipping Container Lines, the country's second-largest container shipping company, said profit declined 76% because of falling freight rates and a rise in fuel cost.
Net profit shrank to RMB 859.2 million, or RMB 0.14 per share, from RMB 3.58 billion a year earlier as sales rose 7.5% to RMB 30.5 billion.
Sales rose as the company increased liftings by 23%. The shipping line carried 5.65 million teu (20-foot equivalent units) last year.
Freight rates fell 12.5% last year to RMB 5,295 per teu for the whole year on an excess of new tonnage. Rates recovered in the second half on a pick-up in Asia Europe/Mediterranean trade after a 14% fall in the first six months.
Fuel costs for the company rose 43% to RMB 6.3 billion.
The appreciation of the RMB magnified the drop in freight rates as shipping lines are paid in US dollars while reporting earnings are in the mainland currency.
The RMB appreciation also meant the company's assets in U.S. and HK dollar denominations continued to depreciate.
Net profit shrank to RMB 859.2 million, or RMB 0.14 per share, from RMB 3.58 billion a year earlier as sales rose 7.5% to RMB 30.5 billion.
Sales rose as the company increased liftings by 23%. The shipping line carried 5.65 million teu (20-foot equivalent units) last year.
Freight rates fell 12.5% last year to RMB 5,295 per teu for the whole year on an excess of new tonnage. Rates recovered in the second half on a pick-up in Asia Europe/Mediterranean trade after a 14% fall in the first six months.
Fuel costs for the company rose 43% to RMB 6.3 billion.
The appreciation of the RMB magnified the drop in freight rates as shipping lines are paid in US dollars while reporting earnings are in the mainland currency.
The RMB appreciation also meant the company's assets in U.S. and HK dollar denominations continued to depreciate.