Jinhui Shipping Sees First Quarter Revenues Decrease by 28% As Dry Bulk Market In Limbo


The Board of Jinhui Shipping and Transportation Limited (the “Company”) is pleased to announce the unaudited condensed consolidated results of the Company and its subsidiaries (the “Group”) for the quarter ended 31 March 2020.

In the first quarter of 2020, the very unexpected and unfortunate outbreak of the COVID-19 was regarded as posing moderate public health risk to start off with, but as the velocity at which the virus spread exceeded experts’ expectations, the World Health Organization (“WHO”) declared COVID-19 outbreak as pandemic in March 2020 as it has affected initially China, then rapidly affected regionally and globally across different countries. This negative backdrop translated to much reduced demand for dry bulk commodities including
iron ore, coal and certain minor bulk cargoes and impacted sentiment in the dry bulk shipping market given the sudden erosion in business confidence. Baltic Dry Index (“BDI”) opened at 1,090 points at the beginning of January and closed at 626 points by the end of March. The average of BDI of the first quarter of 2020 was 592 points, which compares to 798 points in the same quarter in 2019.

Revenue for the first quarter of 2020 decreased 28% to US$9,214,000, comparing to US$12,765,000 for the corresponding quarter in 2019. The Company recorded a consolidated net loss of US$18,371,000 for current quarter as compared to a consolidated net profit of US$1,965,000 for the corresponding quarter in 2019. The consolidated net loss is mainly attributable to (1) poor business sentiment
as affected by the outbreak of the Coronavirus Disease 2019 (“COVID-19”) pandemic leading to a reduction in chartering freight and hire revenue and decrease in fleet utilization rate; (2) the significant unrealized fair value loss on financial assets at fair value through profit or loss of US$10 million amid the COVID-19 pandemic that triggered an adverse global financial markets sell off in early 2020; and (3) an increase in shipping related expenses, in particular the bunker related expenses of US$5 million as a result of both a bunker fuel price slump as well as an increase in bunker consumption due to positioning of owned vessels in between time charter contracts of vessels. Basic loss per share was US$0.168 for the first quarter of 2020 while basic earnings per share was US$0.018 for the corresponding quarter in 2019.

As at 31 March 2020, the Group had eighteen owned vessels which included two modern Post-Panamaxes and sixteen modern grabs fitted Supramaxes.
Source: Jinhui Shipping



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