JES reverses to losses in Q3

Singapore-listed JES posted a third quarter loss of RMB133.09m ($21.84m) as against a profit of RMB11.73m in the previous corresponding period.

Revenue plunged by 93.5% year-on-year to RMB54.17m mainly due to lower newbuilding prices in the fourth quarter of 2012, slow down in production, and a reversal of revenue, which was previously recognised in the first half of 2013 for one contract cancellation in the third quarter this year.

Construction and delivery of bulk carriers is the sole contributor of the group's revenue, the China-based shipyard said. The yard delivered one 47,500 dwt bulk carrier in the third quarter.

JES noted that the present operating environment remains challenging as the US and Europe economies remain on a protracted path to recovery.

“The group's strategy to venture into offshore sector remains as its top priority since construction of vessels and offshore platforms remain as the core business of the group,” JES said.

It added its has “spared no effort” to explore possibilities of diversification into good businesses which will allow the group to “tide over the effects of the business cycle in the shipping industry.”

JES said it intends to make strategic investment in non-core asset or business in an attempt to improve shareholders' value.

Earlier this month, the company announced an investment of about $102m to take a 30% stake in a mining company in Xinjiang, China, as part of its diversification strategy.