The LNG and tanker owner and operator of China Cosco Shipping Corporation Limited (Cosco Shipping) is expecting net profit attributable to equity holders of the company in 2016 to be in the range of RMB1.8bn ($261.6m) to RMB2.1bn, pointing to an increase of 48-72% compared to the RMB1.22bn profit of 2015.
The improvement in profitability was attributed to proceeds of sale of the company’s bulk shipping subsidiary under the parent firm’s structural reform, enhanced cost control measures, and subsidies received for scrapping old vessels and building new ones.
The 2016 profit for Cosco Shipping Energy Transportation would have been higher if not for a RMB230m provision made for liabilities in respect of estimated losses on five long-term chartering contracts.
The Chinese shipowner said the loss-making chartering contracts came under three VLCCs and two dry bulk carriers.
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