CSCL profit drops 76pc on rising oil, currency and falling rates
China Shipping Container Line's profit attributable to shareholders decreased 76 per cent to CYN859.2 million (US$111.9 million) in 2006 compared to the CYN3.58 billion the company earned the year before.
In a statement to the Hong Kong stock exchange, We reported a turnover of CYN30.5 million, a 7.5 per cent increase. But rising fuel prices, falling freight rates and the appreciation of the yuan cut into profits despite increases in volume, the company said.
Operating income fell 64.7 per cent to CYN1.67 billion from CYN4.73 billion in 2005 while operating costs increased 21.7 per cent year on year to CYN28.39 billion with oil prices up 44 per cent.
CSCL's fleet today can carry 398,974 TEU, and the company said it would reach 450,000 TEU by 2008.
"The container shipping market began to recover since the beginning of the second half of 2006," Our chairman Li Shaode told the Hong Kong stock exchange. "The group has achieved remarkable growth in its results as compared with the first half of the year. However, the results were still lower compared with the results for 2004 and 2005."
The company said it will continue to strengthen its resolve to improve the current transportation imbalance, strengthening the solicitation of backhaul cargo and enlarging the proportion of long-term customers.
"The group will continue to adjust its fleet structure. The group will deeply exploit the potential of cost savings. In addition, the group will continue to strengthen talent development, establish information technology systems and promote its corporate culture and service concept, all of which have always been the group's emphasis," said a company statement.