China Shipping Development Co., the commodities-carrying unit of China’s No. 2 shipping company, posted a wider first-half loss as a global oversupply of vessels weighed on freight rates.
The net loss was 923 million yuan ($151 million), compared with 492 million yuan a year earlier, under the International Financial Reporting Standards, the company said in a filing to the Shanghai Stock Exchange today.
China Shipping Development last year sought to delay deliveries of new vessels and scrap more ships as a slump in freight charges pushed the company into its first half-year loss since at least 1998. The company said it expects a net loss for the nine months through September for the group.
“The shipping market is expected to remain difficult in the second half of this year,” the company said in its statement. “In bulk shipping, the growth in global shipping volume is rather small, while the capacity keeps rising, though at a slower pace.”
Shares of China Shipping Development, a unit of China Shipping Group Co., rose 0.3 percent to HK$4 in Hong Kong trading today before the earnings were released. Its Shanghai shares gained 0.6 percent.
The Baltic Dry Index, the benchmark for hauling commodities, averaged 920 points last year, the lowest since 1986.