COSCO loses 10.4 billion net profit

(Ecns.cn)--China Ocean Shipping Company Ltd (COSCO), the country's largest shipping company by market value, announced on Thursday that the company's turnover in 2011 was 68.908 billion yuan (US$10.9 billion) in 2011, which fell by 12.3 percent over 2010.

Additional bad news came in the form of a loss in 2011 of 10.449 billion yuan (US$1.65 billion) net profit attributable to to equity holders of the company. But the net profit gained in 2010 was 6.76 billion yuan (US$1.07 billion), according to the company's 2011 annual financial performance report.

In the first three quarters of 2011, the loss of net profit was only 4.776 billion yuan (US$758 million), while in the fourth quarter, the number had surged by over 5 billion yuan (US$793 million) to 10.4 billion, said the report. The big loss was beyond any analyst's expectations.

The great net profit loss was only below that made by China Easter Airlines in 2008, which was recorded at 13.828 billion yuan (US$2.1 billion), but the latter succeeded in making up the deficit and restoring surpluses in 2009.

But for Wei Jiafu, chairman of COSCO, the worst time for the company and the whole of its shipping industry is not yet over. The loss was mainly due to the great fall in freight fares, the increase of fuel oil costs and the imbalance in market demand and supply.

Besides COSCO, other shipping companies also saw some degree of net profit loss in 2011.