Jinhui Shipping Bounces Back to Profit

Driven by the recovery in the dry bulk sector, Hong Kong-based shipping company Jinhui Shipping and Transportation Limited managed to return to profit in the third quarter of this year. 

The company recorded a net income of USD 2.2 million in Q3 2017, compared to a net loss of USD 28.5 million posted in the corresponding period a year earlier.

Revenue for the third quarter of 2017 declined by five percent to USD 18.1 million from USD 19 million seen in the same quarter last year. The average daily time charter equivalent (TCE) rates earned by the company’s owned vessels improved by 43 percent to USD 8,852 during the third quarter of 2017 from USD 6,195 for the corresponding quarter in 2016.

“Dry bulk shipping market maintained positive momentum in the third quarter due to the noticeable increase in dry seaborne trade volumes and importing of iron ore and coal in China. Baltic Dry Index opened at 901 points at the beginning of July and continued to climb to the peak of the quarter at 1,503 points and closed at 1,356 points by the end of September,” the company explained.

Additionally, the company narrowed its net loss to USD 6.5 million in the first nine months of 2017 from USD 67.7 million seen in the nine-month period of 2016.

During the first nine months of 2017, Jinhui entered into five memoranda of agreement to dispose of four Supramaxes and one Handysize ship for USD 63 million. Following this,  the company’s total carrying capacity had been reduced to 1.3 million metric tons.

As of November 26, Jinhui Shipping had twenty-three owned vessels, comprising 21 Supramaxes and two Post-Panamaxes.

“During the 3rd quarter, the market remains to be healthy but we remain cautious nevertheless and hold the view that the path to a meaningful recovery and demand-supply equilibrium will not be without challenges,” the company said in its outlook.

“We are in a relatively fortunate position where we have no capital expenditure commitment in relation to newbuilding contracts. Looking ahead, we will continue to focus on taking sensible and decisive actions to maintain a strong financial position, maintaining a young and modern fleet, and focus on the further reduction of debt to ensure we sail through stormy waters,” Jinhui Shipping added.