COSCO Investment (Singapore) Ltd. posted a 66 percent jump in first-half net profit to S$9.25 million ($5.27 million) on greater margins from bulk shipping and its container feeder service operations. But turnover fell 10 percent to S$78 million due mainly to the scaling down of its trading activities. Singapore-listed COSCO, a unit of China's COSCO Group, said it expected its performance in the second half to be comparable to the first as all of its business units were
expected to remain profitable except for property.
G.K. Goh analyst Masya Spek told reporters after the company's news conference that COSCO's shipping business performed within expectations but general trading was stronger than anticipated.
"I didn't expect them to do so much general trading. I was looking at less returns to general trading," she said. General trading accounted for about 46 percent of turnover for the first half
, while shipping contributed 48 percent.
President Ji Hai Sheng told the news conference COSCO intended to concentrate on its shipping business and divest other non-core activities but declined to give a timeframe. Despite the economic downturn, Ji said prospects for the shipping business remained strong and COSCO planned to boost capacity by adding two new
dry bulk carriers in the next two years.
This would expand its existing fleet of carriers to 13 and increase shipping volumes to 703,128 dwt. "Shipping for COSCO Investment made a lot of improvement in operations...The profit margins are really good," Ji said, adding that the new ships were due to be delivered in 2002 and 2003 and had already signed charters. Ji said 10 of COSCO's 11 bulk carriers were chartered on a one-year basis and the contracts would be renewed by the end of the year or in the first half of next year. - (Reuters)