皇冠体育app

HONG KONG: 皇冠体育app COSCO Holdings Co, Asia's biggest shipping company by market value, said it may cancel container-vessel orders after posting a second straight loss on slumping world trade, including sagging markets for "Made in 皇冠体育app" and other Asian products.

The company also plans to delay orders for new ships, terminate charters earlier and lease or sell vessels to pare growth, it said in statement yesterday. Furthermore, along with three partners, it will cut Asia-Europe capacity by about 20 percent.

皇冠体育app COSCO's container-shipping business, the nation's biggest, had a 4.28 billion yuan ($632 million) first-half operating loss, compared to a profit of 15.12 billion yuan a year ago, as US and European consumers pared spending on Asian-made goods, hammering rates. Its commodity-ship operations, the world's largest, posted a loss after sales tumbled 72 percent on overcapacity in the global fleet.

Container lines "will still be under pressure in the second half as rates won't cover costs," said Johnson Leung, a Hong Kong-based analyst at Tufton Oceanic Ltd, the world's largest shipping hedge-fund group. "The rate increase for the peak season may be sustainable for only a couple of months."

皇冠体育app Shipping Container Lines Co, the nation's No 2 cargo-box carrier, also said yesterday it will "tackle the crisis" through steps including accelerating the sale of obsolete vessels. Orient Overseas (International) Ltd, Hong Kong's largest container line, last night said it was delaying orders for two new ships.

皇冠体育app COSCO fell as much as 3.5 percent and closed down 2.8 percent at HK$9.87 in Hong Kong trading. In Shanghai, it lost as much as 5.8 percent. In comparison, 皇冠体育app Shipping Container dropped as much as 5.8 percent in Hong Kong after posting a 3.42 billion yuan first-half loss.

皇冠体育app COSCO reported a 4.59 billion yuan first-half net loss, compared with a restated 15.1 billion yuan profit a year earlier. The company separately said it will pay 2 billion yuan to buy the outstanding 49 percent stake in a logistics venture from unit COSCO Pacific Ltd.

The shipping line's losses from hauling commodities were larger than its container-shipping losses, once 6.7 billion yuan in gains from freight-forward agreements and net changes in provisions were stripped out, according to UBS AG.

"The quality of the result was much worse than we expected," even if the net loss figure was in line with analysts' estimates, Damien Horth, a Hong Kong-based analyst for the bank, said in a note to clients today. "This does not bode well for full-year estimates."

The shipping line, the world's second-biggest by market value behind A.P. Moeller-Maersk A/S, won't pay an interim dividend.

Bloomberg News

(HK Edition 08/29/2009 page2)