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Singamas slumps to $37m H1 loss on slowing economySingamas slumps to $37m H1 loss on slowing economy

Singamas Container Holdings turned to a $36.6m loss in the first half from a $10.1m profit previously as revenue plunged 42% to $410.3m from $704.0m in the previous corresponding period.

Vincent Wee, Hong Kong and South East Asia Correspondent

August 26, 2016

2 Min Read
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Singamas blamed a continuing slowdown in the global economy as the downward trend that was especially acute from the second half of 2015 persisted.

"The lacklustre conditions directly affected world trade, which in turn impacted on the demand for new dry freight containers and placed further pressure on the average selling price (ASP)," Singamas said in a stock market announcement.

The company noted that the recent major movements in the container liner and leasing space have created market uncertainties, which further aggravated demand for newcontainers due to delays in capital investments.

"The combination of lower business volume and lower ASP resulted in an appreciable decline in the group’s performance," SIngamas concluded.

At a segment level, revenue from the main manufacturing operations slipped to $393.8m from $688.2m previously and slipped to a pre-tax loss of $33.5m from a $12.4m profit previously.

Both volumes and selling price fell. The group produced 223,982 teu in the first half compared to 336,581 teu previously while the ASP of a 20-foot dry freight container fell from $1,880 to $1,414 year-on-year number of containers sold came up to 236,388 teu down from 331,449 teu previously.

Singamas' logistics operation performed relatively better, putting in at least a stable performance, generating revenue of $16.5m, slightly up from $15.9m previously.

However, profits were hit, as due to commercial reasons, the Group made additional compensation of $6.7m in connection with the Tianjin explosions incident.

As a result the segment turned to a pre-tax loss of $3.8m from a profit $3.8m previously. A total of approximately 1.7m teu was handled by the group compared to 1.6m teu in the previous corresponding period.

Looking ahead, Singamas said: "The challenging economic conditions are not expected to subside in the short term; hence demand for new containers will remain weak in the immediate future."

About the Author

Vincent Wee

Hong Kong and South East Asia Correspondent

Vincent Wee is Seatrade's Hong Kong correspondent covering Hong Kong and South China while also making use of his Malay language skills to cover the Malaysia and Indonesia markets. He has gained a keen insight and extensive knowledge of the offshore oil and gas markets gleaned while covering major rig builders and offshore supply vessel providers.

Vincent has been a journalist for over 15 years, spending the bulk of his career with Singapore's biggest business daily the Business Times, and covering shipping and logistics since 2007. Prior to that he spent several years working for Brunei's main English language daily as well as various other trade publications.

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