Yangzijiang Shipbuilding Shares Fall After Falling Third Quarter Profits
By Ronnie Harui
The shares of Yangzijiang Shipbuilding Holdings Ltd. fell 6.4% to S $ 1.31 on Tuesday morning after reporting a 21% drop in third-quarter gross profit.
The Singapore-listed shipbuilder said Monday after the market closed that gross profit fell to 1.00 billion yuan ($ 156.3 million) in the third quarter.
Despite a 25% increase in revenue to CNY 4.47 billion, Yangzijiang’s gross profit margin narrowed 13 percentage points to 22.4% due to rising raw material costs.
Revenue from the core shipbuilding segment jumped 45% to CNY 3.69 billion, mainly due to a higher level of shipbuilding activity. The company delivered 15 vessels during the quarter, up from nine vessels a year earlier. However, the segment’s gross profit fell to CNY 486.15 million, from CNY 694.87 million a year ago, due to rising raw material costs.
The company said its main shipyards are currently operating at full capacity and there is no change in its scheduled ship deliveries in the second half of 2021.
Yangzijiang added that as part of a strategic review of its debt investment portfolio to allow it to focus on its core shipbuilding business, it continues to consider various possibilities and their respective tax implications.
Write to Ronnie Harui at [email protected]