Singapore-listed Cosco Corporation Limited, an investment holding company, engaged in ship building, marine engineering and dry bulk shipping, expects to post a net loss in its consolidated financial results for the second half of 2015.
The announcement follows Cosco’s reported decrease of 94% in net profit for the quarter ending March 31, 2015 worth SGD 0.8m, as operating conditions continued to deteriorate.
Cosco said in its profit guidance that the expected net loss is mainly attributable to the low crude oil prices over recent months which has had an adverse impact on the global offshore marine industry.
Furthermore, the poor results stemming from the languid dry bulk shipping market have brought great pressures to the company’s dry bulk fleet operations, Cosco said.
The company’s turnover from dry bulk shipping and other businesses fell 12% to SGD 10 million on lower charter rates in the first quarter.
As the slump in the shipbuilding market resumed in the second quarter of the year, Cosco’s shipyards were negatively impacted pushing earnings further down.
Cosco said that further details of the company’s financial performance will be disclosed in its 2Q 2015 results, which are scheduled to be released on 31 July 2015.