China’s Yangzijiang Shipbuilding Holdings reported a 73 percent increase in second-quarter net profit, helped by higher revenue from the construction of larger-size vessels, Reuters reported.
The company, which specialises in dry-bulk carriers, posted a net profit of 719.92 million yuan (S$146 million) for the second quarter ended June 30, 2017. Revenue increased 27 per cent year on year to 3.79 billion yuan in Q2 due to higher contributions across its different businesses.
The revenue derived from its shipbuilding business increased 25 per cent mainly due to higher volume of shipbuilding activities with construction of larger-sized vessels.
A report in Nikkei quoted Yangzijiang saying that there are factors supporting long-term demand for container ship and dry bulk carriers, although it believes the overall shipping industry's overcapacity problem will not dissipate for some time.
The company, which has four shipyards in China'sJiangsu province, secured 33 new shipbuilding orders worth $832 million in the year to date, including orders for three container ships and three bulk carriers in the second quarter.
The company was confident of meeting its order win target of $1.5 billion in 2017, Executive Chairman Ren Yuanlin told reporters on Tuesday. Margins could, however, come under further pressure this year, he said.
The medium-size shipbuilder based in Jingjiang, Jiangsu Province, is a component of the Straits Times Index, the Singapore market's key gauge. It builds mainly large transport vessels, including bulk carriers and liquefied natural gas tankers.