Hong Kong: China Rongsheng Heavy Industries maintained steady net profit for 2011 while revenue climbed 25.6% as it expanded the shipbuilding and engineering machinery businesses.
Net profit for last year stayed at RMB1.72bn ($272m) while revenue rose to RMB15.9bn from RMB12.7bn in 2010.
In 2011, Rongsheng secured newbuilding orders for 39 vessels of 4.6m dwt with a total contract value of $1.81bn. As at 31 December 2011, the Chinese yard's orderbook included 111 vessels representing 16.8m dwt and a contract value of $6.6bn.
The Hong Kong-listed shipbuilder expects the shipbuilding industry to remain weak this year as the imbalance between supply and demand is unlikely to be resolved shortly.
“New orders of the three traditional types of vessels will encounter difficulty. However, sales of high value vessels such as very large containerships with capacities of over 10,000 teu are expected to remain steady,” Rongsheng said in a statement.
The company added that the Chinese shipbuilding industry will enter a period of restructuring and polarisation, further widening the gap between leading shipyards and greenfield shipyards, particularly those with a weak orderbook.
“In the long-run, adjustment and restructuring will relieve oversupply and help to restore market equilibrium,” Rongsheng said.