YZJ Shipbuilding profits up 11% to $345.4m in H1
Yangzijiang (YZJ) Shipbuilding profits climbed by 11% YoY to $345.4m in H1 from $311.9m in the same period last year, an announcement revealed. Revenue for the same period inched up by 3% YoY to $2.6b from $2.53b.
Despite the stable half-year performance, profits slipped by 6% YoY to $183.75m in Q2 from $195.22m last year, whilst revenue also tumbled down 12% YoY to $1.38b in Q2 from $1.56b in Q2 2018.
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, down from 20 vessels last year, which resulted in the revenue contribution from the shipbuilding business to be $603.8m lower in Q2 2019 compared to Q2 2018. Cost of sales also declined 9% YoY to $1.14b from $1.26b last year.
These were slightly offset by higher revenue from the trading business, which rose to $637m in Q2 from $431m previously; and other shipbuilding related businesses, which generated profits of $35.12m in Q2 from $26.1m the previous year.
Other losses and gains were attributed to foreign exchange-related gains/losses, fair value changes on financial assets, and subsidy income.
YZJ Shipbuilding stated that global new shipbuilding orders declined in the first half of the year by 50% in DWT terms compared to H1 2018. The firm noted that shipowners’ sentiments fell due to the “less-bullish” outlook on economic and trade growth, and uncertainties associated with the forthcoming IMO rules on emissions. However, global shipbuilding delivery still increased by 12% YoY in H1.
YZJ Shipbuilding’s portfolio currently comprises of 11,800TEU containerships, the 83,500DWT combination carriers and the 400,000DWT VLOCs. Last July, the firm announced that it has acquired 55% stake in Odfjell Terminal (Jiangyin) Company, the Chinese arm of Norwegian shipping company Ofdjell SE. The firm currently has a standing order book of $4.28b for 85 vessels.
Source: Singapore Business Review