Hong Kong and Shanghai-listed Cosco on Wednesdayreported a deficit of CNY 4.87bn ($767m), versus a CNY 2.75bn shortfall in the sixmonths to 30 June 2011.
In a securities filing, managementblamed the result on the weakening pace of China’s economic expansion, alingering imbalance in supply and demand due to excess global fleet capacity,soaring fuel costs and a grim freight rate environment that continues to plaguedry-bulk.
Cosco said revenue from its bulkerdivision fell by more than 32% to CNY 8.26bn in the first half year-on-yearwhile its container shipping unit watched revenue increase 14.1% to CNY 23.12in response to a 16.7% jump in volume.
Total revenues weighed in at CNY 42.56bn,a modest improvement when compared to the CNY 42bn generated a year ago, butgains from its logistics, terminal and leasing businesses were offset by lossesof CNY 1.31bn and 3.42bn in the liner and dry-bulk segments, respectively.
Goingforward, Cosco expects capacity issues to continue but intends to “accelerateand exploit” emerging markets and develop strategic alliances in the linersector and plans on streamlining its dry-bulk division by disposing of ageingtonnage, expanding its coastal shipping fleet and fine tuning its charteringstrategy while cutting costs.
