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Sinotrans Shipping slumps to $18m H1 loss

Sinotrans Shipping slumps to $18m H1 loss
Apparently setting the tone for Chinese shipping companies, Sinotrans Shipping slid back into the red for the first half of 2015, turning to a $18.3m loss from a small $2.3m profit in the previous corresponding period.

Unsurprisingly revenues plunged almost a fifth to $485.1m from $601.6m previously as the overall international shipping market remained depressed in the first half, Sinotrans said in a stock market announcement."The recovery of global economy was slow and uneven, among which the growth of developed economies has picked up but was still weaker than anticipated, while the increase in emerging economies such as China continued to slow down. As a result, the growth of international trade and seaborne demand stayed in low gear," it added.

Sinotrans also bemoaned the persistent fleet overcapacity situation and low freight rates, especially the record low spot rates of the dry bulk market during the first half."In light of such severe market situation, our Group managed to maintain a steady operation by making full use of our low-cost advantage and taking proactive actions such as flexibly adjusting our operating mode, optimising our fleet structure, intensifying the integration of internal resources as well as enhancing the management capability," Sinotrans said.

In sharp contrast to perhaps more efficient companies such as Orient Overseas (International) Ltd, which reported a $238.6m profit earlier this week, despite a 15% reduction in costs to $505.1m from $592.7m previously, drops in revenue overwhelmed the company. Dry bulk shipping turnover fell 22% to $247.8m while container shipping revenue fell 17% to $236.7m.