The container carrier arm of China Shipping Group (CSG) reported a profit of RMB19.1m ($2.98m), a plunge of 97% compared to RMB444.82m in the previous corresponding period.
Revenue also fell to RMB15.99bn during the first half ended 30 June 2015 compared to RMB17.41bn in the year-ago period.
During the first half, CSCL was hit by a deficit of RMB17.52m on disposal of items and foreign exchange losses, as against the gain of RMB886.02m in the same period of last year.
The sluggish global container shipping market also did not help the company generate substantial income from freight rates. “Freight rates for Asia-Europe trade lanes hit record low levels under the impact of new shipping capacity put into market amid a weak economic growth momentum in the eurozone,” CSCL said.
It added that freight rates for Asia Pacific trade lanes underwent volatility under the gradual upgrade of shipping capacity.
The company said that it loaded container volume amounted to 3.99m teu in the first half, an increase of only 1% year-on-year, and revenue went down by 8.1% to RMB15.99bn.
“In the second half of 2015, international trade still won’t be cheerful,” CSCL stated.
“With the massive influx of new shipping capacity, shipping market will face even more uncertainties. The shipping industry is gradually developing towards scale expansion, intensive operation and supply chain integration. Threshold of market entry and service standards will continue to rise along with the increasing scale of container liners, innovations in large vessel operations and in service concepts.”
Meanwhile, the shares trading of CSCL remained suspended pending a major announcement by its parent CSG that is widely believed to be a merger with compatriot Cosco Group.
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