Jinhui Issues Profit Warning As Dry Bulk Plummets
Jinhui Shipping and Transportation Limited expects to record a wider net loss for the fourth quarter and year ended 31 December 2015, compared to a year earlier on account of record-low freight rates in the dry bulk shipping market.
The Hong Kong-based marine transportation company has faced a tough year in 2015 in the dry bulk shipping market, coupled with deeper than expected slowdown of China’s economic growth, ambiguous currency policies, and a meltdown in commodities prices from metals to oil all occurring in a synchronised manner.
A statement from Ng Siu Fai, Jinhui Chairman said: "Year 2015 was another tough year for dry bulk shipping market, with drastic confidence crisis in the final quarter stimulated by the reverse of the U.S. interest rate cycle marking the end of the quantitative easing era, the deeper than expected slowdown of the China’s economic growth, ambiguous currency policies, and a meltdown in commodities prices from metals to oil all occurring in a synchronized manner.”
The company said that the expected net loss for the fourth quarter of 2015, would be largely attributable to the substantial impairment loss on certain owned vessels, while the net loss for 2015, would be due to the combined effect of the impairment loss on certain owned vessels, the weak spot freight market, and the abrupt correction of global stock markets in late 2015 which caused a net loss of approximately USD 19 million on the company’s investments.
Jinhui Shipping has booked a deficit of $32.39m for the third quarter ended 30 September 2015, widening from the loss of $15.73m seen in the same period of 2014.
