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Rongsheng in red as shipbuilding sector slumps
By Richard Fu |
December 24, 2012, Monday
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Online Edition
Online Edition
CHINA Rongsheng Heavy Industries Group Holdings Ltd said it may report its first annual loss in four years amid a slump in the shipbuilding market.
The decline in the shipbuilding market has "led to the sharp decrease in orders and prices of vessels compared with the same period last year," Rongsheng, China's largest private-sector shipbuilder, said in a filing to the Hong Kong stock exchange today, without giving figures.
The company in August reported an 82 percent plunge in first-half earnings as a global economic slowdown and overcapacity reduced demand for vessels from the shipping industry.
To offset the sluggish shipbuilding business, Rongsheng is setting up a new unit for offshore energy equipment in Singapore. But an insider-trading scandal involving its then chairman Zhang Zhirong and China's largest offshore oil producer CNOOC Ltd early this year raised doubt about the prospects of this new business unit. CNOOC is potentially a big customer for Rongsheng's offshore equipment products.
Zhang stepped down last month to devote more time to his personal endeavors.
Rongsheng fell 1.46 percent to HK$1.35 (US$0.17) today while the Hang Seng Index rose 0.16 percent.
The decline in the shipbuilding market has "led to the sharp decrease in orders and prices of vessels compared with the same period last year," Rongsheng, China's largest private-sector shipbuilder, said in a filing to the Hong Kong stock exchange today, without giving figures.
The company in August reported an 82 percent plunge in first-half earnings as a global economic slowdown and overcapacity reduced demand for vessels from the shipping industry.
To offset the sluggish shipbuilding business, Rongsheng is setting up a new unit for offshore energy equipment in Singapore. But an insider-trading scandal involving its then chairman Zhang Zhirong and China's largest offshore oil producer CNOOC Ltd early this year raised doubt about the prospects of this new business unit. CNOOC is potentially a big customer for Rongsheng's offshore equipment products.
Zhang stepped down last month to devote more time to his personal endeavors.
Rongsheng fell 1.46 percent to HK$1.35 (US$0.17) today while the Hang Seng Index rose 0.16 percent.
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