COSCO Corporation (Singapore) Limited has posted net losses of S$570 million for FY2015, compared with the earnings of S$20.9 million in FY2014. The company is hurt by writedown of inventory and possible non-payment by some of its customers.
Revenue declined 17% to S$3.5 billion for the fiscal year to December, on the back of lower revenue from marine engineering in the shipyard business, and lower charter rates in the shipping business.
Fourth quarter revenue fell 21 per cent to S$725.5 million while full-year revenue fell 17 per cent to S$3.5 billion.
The Singapore-listed Chinese shipyard said the global offshore market continued to slow down significantly with no signs of improvement, due to the weak global economy and depressed oil prices.
Cosco Singapore vice-chairman and president Wu Zi Heng said in a press release that the global offshore market continued to slow down significantly with no signs of improvement.
"Amidst persistent weakness in the state of the global economy and depressed crude oil prices, the group continues to face adverse unfavourable market conditions," he said.
Orders for rigs and other offshore and marine equipment have fallen sharply over the past year, as oil companies reduced spending on exploration and production amid the sharp drop in oil prices.
Cosco's order book stood at US$8 billion at end-2015, but the company noted that the amount is subject to cancellation or rescheduling of orders.