COSCO Group (Singapore) Report Decline in Bulk Shipping, Shipyard Revenue in Q1

Cosco Corporation (Singapore) reports turnover down slightly due to decline in dry bulk shipping & shipyard revenues in first quarter of 2012

Overview of the report is as follows:

Against the backdrop of a difficult business environment, the Group achieved turnover of $978.7 million with a net profit attributable to equity holders of $27.8 million.

Group turnover inched down 3.2% to $978.7 million in Q1 2012 from $1.0 billion in Q1 2011 due to a decline in dry bulk shipping and shipyard revenue.

Turnover from shipyard operations decreased marginally by 2.5% to $965.9 million in Q1 2012 from $990.2 million in Q1 2011 mainly due to lower revenue contributions from ship repair and ship building segments which more than offset the growth in revenue from marine engineering segments.

The Group successfully delivered 12 dry bulk carriers in the 1st quarter of 2012. Of these, COSCO Guangdong shipyard delivered 3 bulk carriers, COSCO Zhoushan shipyard delivered 5 bulk carriers and COSCO Dalian shipyard delivered 4 bulk carriers. I

In addition, COSCO Nantong shipyard delivered the Sevan Brasil, a cylindrical drilling unit, and a shuttle tanker.

Turnover from dry bulk shipping and other businesses decreased 37.6% to $12.8 million in Q1 2012 from $20.5 million in Q1 2011 as the current short-term charter rates were significantly lower than the more favorable charter rates received in Q1 2011.

Ship repair, ship building and marine engineering business continued to contribute to the bulk of the Group’s revenue, constituting 98.7% of Group turnover in Q1 2012. Dry bulk shipping and other businesses accounted for the remaining 1.3%.

Gross profit decreased by 11.8% from $112.0 million in Q1 2011 to $98.8 million in Q1 2012 mainly due to lower dry bulk shipping income as a result of lower BDI and lower shipyard revenue.