The world’s fourth largest container shipping line, COSCO Shipping, experienced the 9.9 billion yuan (U.S. $1.44 billion) loss due to weak freight rates and restructuring costs, Reuters said Thursday.
China’s COSCO Shipping Holdings Co., Ltd. recorded a 9.9 billion yuan (U.S. $1.44 billion) loss in 2016, fueled by weak freight rates and restructuring costs, Reuters said Thursday.
The result was in line with a profit warning the company issued in January when it cited “slow growth in global container shipping demand and oversupply of shipping capacity” and said “the international shipping market still lacked solid improvement in addressing the imbalance in supply and demand.”
Revenues in 2016 totaled 71.2 billion yuan (U.S. $10.3 billion).
COSCO, the world’s fourth-largest container shipping line, is the result of last year’s merger of COSCO and China Shipping, and Reuters noted this makes comparisons of results from the prior year difficult.
Since the merger, COSCO has been restructuring, selling some units, including COSCO Bulk Shipping and Florens Container Holdings, at a loss and focusing on container shipping.
Looking ahead, Reuters said COSCO reported “seeing some positive signals in demand and expects the overall market this year to be better than that of 2016.”
Effective April 1, COSCO will be a member of the Ocean Alliance, a vessel sharing agreement on major east-west trades, which also includes CMA CGM of France, Evergreen Line of Taiwan, and OOCL of Hong Kong.
COSCO Shipping records $1.4b loss in 2016
