China Rongsheng May Post First Annual Loss in 4 Years
China Rongsheng Heavy Industries Group Holdings Ltd. (1101), the country’s largest shipbuilder outside state control, forecast its first annual loss in four years as vessel prices and orders slump.
The company is expected to post a net loss this year based on unaudited accounts for 11 months ended Nov. 30, China Rongsheng said in a stock exchange filing today. It didn’t disclose any numbers.
First-half profit of the company plunged 82 percent as a global overcapacity and lower charter rates deterred shipowners from ordering more vessels. China Rongsheng is setting up a new offshore-energy equipment unit as it seeks contracts for oil rigs and tender barges to offset slowing ship demand.
The shipbuilder previously posted an annual loss in 2008, according to data compiled by Bloomberg. It was expected to report a profit of 563 million yuan ($90 million) this year, according to the average of 5 analyst estimates compiled by Bloomberg.
Shipyards in China won 12.6 million deadweight tons of orders in the first nine months of the year, compared with 23.9 million a year earlier, according to Clarkson Plc (CKN), the world’s biggest shipbroker. Their backlogs fell to 116.4 million tons at the end of September from 169.3 million tons at the end of 2011.
To contact the editor responsible for this story: Vipin V. Nair at email@example.com