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Jinhui sees Q3 loss more than doubled

Jinhui sees Q3 loss more than doubled
Jinhui Shipping and Transportation has booked a third quarter loss that more than doubled from the deficit of the year-ago period.

Net loss for the quarter ended 30 September 2015 was reported at $32.39m, widening from the loss of $15.73m in the same period of last year.

The larger loss was blamed on a settlement of $21.4m to charterers in relation to repudiation claims.

The quarterly revenue dropped to $24.17m from $27.04m in the year-ago period.

Hong Kong-listed Jinhui noted that its loss was also largely driven by the weak dry bulk shipping market which continued to dent the group’s hire and freight revenue.

“We expected the 2015 dry bulk shipping market will be a tough market, it turns out to be unprecedentedly tough,” the shipowner said.

The company observed that a number of factors continue to hindle the dry bulk market recovery, including slower demand growth, much lower oil price discouraging slow steaming and effectively releasing further tonnage supply, and the irrational ordering of newbuildings.

“On a positive note, this excess newbuilding orders driven by irrational expectations of financial return by parties with limited operating experience, backed by access to cheap funding in the capital market, and fee driven intermediary institutions seems to come to a halt,” it commented.

“In fact, given the reality of the prevailing tough trading environment, delays, conversions, cancellations, and shipyard defaults are leading to fewer actual deliveries than previously scheduled.”

As at 29 November 2015, Jinhui owned 36 ships including two post-panamaxes, two panamaxes, 31 supramaxes/handymaxes, and one handysize.