Second-largest Chinese shipping company China Shipping Container Lines (CSCL) has made an announcement to the Hong Kong Stock Exchange, in which it has warned investors that it is expecting to make a US$430 million net loss in 2015 as a result of losses from vessel impairments and low freight rates, despite a profit of $140 million made in 2014, according to the Journal of Commerce.
Container and vessel impairments are anticipated to lead to an additional loss of $130 million for CSCL.
CSCL and its alliance partner Cosco have recently had its alliance, which was ordered by China to deal with a struggling market, approved, with each carrier currently completing complex proceedings.
CSCL is set to focus on the financing and leasing side of the merger, with Cosco focus on container shipping operations.
The Shanghai Shipping Exchange released a filing which said: “It is uncertain for the shipping industry to see a recovery in the future due to the impact of the global economic downturn.
“It is expected that the company will record operating losses of approximately $300 million in 2015 due to the impact of the intensive adjustment of the shipping cycle.”
PTI previously reported that CSCL and Cosco will be operating as a ‘new entity’ merger, which involves swapping assets and ship leasing.
“It is expected that the company will record operating losses of approximately $300 million in 2015 due to the impact of the intensive adjustment of the shipping cycle.”
PTI previously reported that CSCL and Cosco will be operating as a ‘new entity’ merger, which involves swapping assets and ship leasing.
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