As flagged, first half net loss almost tripled to HKD102.83m ($13.26m), from HKD34.82m in the previous corresponding period, mainly due to the decline in revenue, profit margins and the absence of gain on settlement of deferred consideration, the group said in a stock market announcement.
The key shipbuilding segment saw revenues plunge due to work delays because owners had not secured financing. Not running at full capacity and appreciation of the Renminbi, led to falls in profit margin, resulting in an operating loss of HKD12.57m from a small profit of HKD7.42m previously.
The group revealed that an existing client had deferred payments which strained its cash position, however the client still has outstanding ships to be delivered and it expects to recover the outstanding balances by taking certain measures and negotiating with the debtor. As a result, the group continued to impose tight costs control measures such as reducing the number of workers.
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