YANGZIJIANG (YZJ) Shipbuilding achieved 11 per cent higher profits in the first half of the year compared to 2018, to stand at US$345.4 million, on a three per cent increase in revenue at $2.6 billion.However, profits declined by six per cent year on year in the second quarter to $183.75 million, while revenue fell by 12 per cent to $1.38 billion.
The firm attributed the quarterly profit decline to the lower number of vessels delivered in the second quarter. Only 18 vessels were delivered in the quarter, compared to 20 ships over the same period last year.
As a result, revenue contributed by the shipbuilding business was $603.8 million lower in Q2 2019 than in Q2 2018. Cost of sales also contracted by nine per cent YoY to $1.14 billion, reported Singapore Business Review.
YZJ Shipbuilding said global new shipbuilding orders decreased in the first half of the year by 50 per cent in deadweight tonnage (dwt) terms compared to the first half of 2018. The firm noted that shipowners' sentiments fell due to the "less-bullish" outlook on economic and trade growth, and uncertainties associated with the IMO 2020 low sulphur cap.
YZJ Shipbuilding's portfolio currently comprises 11,800-TEU containerships, 83,500 dwt combination carriers and 400,000 dwt very large ore carriers (VLOCs). Last July, the company acquired a 55 per cent stake in Odfjell Terminal (Jiangyin) Company, the Chinese arm of Norwegian shipping company Ofdjell SE. The firm has a standing order book of $4.28 billion for 85 vessels.
Source:HKSG GROUP
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