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Cosco Corp stays in the red on annual loss of $695m

Cosco Corp stays in the red on annual loss of $695m
Cosco Corporation (Singapore) Limited remained in the red in 2016 on the back of continuing weakness in the shipping and shipbuilding markets.

Cosco Corp reported a net loss of SGD976.1m ($695m) for 2016 compared to a SGD914.8m net loss in the previous year.

Revenue for the Singapore-listed company fell by 27% year-on-year to SGD2.56bn owing to lower contributions from the shipyard and shipping businesses.

“Financial year 2017 continues to be tough sailing for our group under cloudy skies and tumultuous external headwinds engulfing the shipping and marine industries,” commented Gu Jingsong, vice chairman and president of Cosco Corp.

As at end-2016, the group sat on an orderbook of approximately $6.4bn with progressive deliveries up to 2019, including modiles of drillship and FPSO contracts, and offshore marine engineering projects.

Cosco Corp warned that the orderbook will continue to be subject to revision from any new, cancellation, variation or scheduling of orders that may arise. The group also expected possible decline in new orders and more project delivery delays or request for deferments from some customers.

It further warned that it will face difficult and challenging business and operating conditions in 2017.

Meanwhile, Cosco Corp has been informed of a proposed equity acquisition plan by its parent China Cosco Shipping Corporation (Cosco Shipping) relating to the restructuring of the shipyard business.

Cosco Shipping will acquire Cosco Corp’s equity interests in Cosco Shipyard Group, Cosco (Nantong) Shipyard and Cosco (Dalian) Shipyard, for the purpose of centralising operations and management of the shipyard businesses.