Cosco’s net profit plunges 44% to $139.7m in 2011

As turnover from its dry bulk shipping business plummeted by more than 50% due to lower charter rates.

COSCO Corporation Limited announced its Group turnover, which registered a 7.8% increase to $4.2 billion in FY2011, boosted by higher revenue from the Group’s shipyard operations.

Shipyard turnover rose 10.1% to $4.1 billion on the back of higher progressive revenue recognition for the Group’s ship building and marine engineering projects. This more than offset the 52.9% lower turnover from dry bulk shipping business of $66.8 million in FY2011 due to lower charter rates.

Gross profit decreased 20.0% from $476.1 million in FY2010 to $380.8 million in FY2011 mainly due to lower dry bulk shipping income led by lower BDI and higher operational costs in shipyard business. The rising cost environment and higher tax expenses (due to lower tax-exempt shipping profits and a deferred tax benefit recognized) resulted in the overall 43.9% fall in net profit attributable to equity holders of the Company from $248.8 million in FY2010 to $139.7 million in FY2011.

As at 31 December 2011, the Group’s order book stood at US$6.1 billion with progressive deliveries up to first half 2014.