STX Pan Ocean loses US$70 mln in Q1

STX Pan Ocean loses US$70 mln in Q1
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SEOUL, May 15 (Yonhap) -- STX Pan Ocean Co., South Korea's biggest bulk shipping
line, said Friday it swung to a net loss in the first quarter from a year earlier
on falling freight rates and low shipping demand.

STX Pan Ocean lost US$70 million in the January-March quarter, compared with a
net profit of $285 million a year earlier, said the company which is listed on
both the Korea Exchange and the Singapore Exchange.
Sales reached $769 million during the cited period, compared with $2.25 billion a
year earlier, with its operating balance turning to a deficit of $28 million from
a profit of $327 million, STX Pan Ocean said.
The company attributed the first-quarter loss to a fall in rates for commodity
shipping amid sluggish demand and foreign exchange losses. Bulk-shipping rates
slumped around 70 percent on-year in the first quarter, according to STX Pan
Ocean. A weak currency also cut into the value of its locally denominated assets,
it said.
As of the end of March, the local unit fell 28.4 percent against the U.S. dollar
from a year earlier.
The company, however, predicted the worst for the dry bulk market may be over as
pump-priming measures by the United States and China are expected to help demand
rebound.
"With signs of a recovery in both freight rates and profitability emerging, we
are expecting a better second half in terms of earnings," CEO Lee Jong-chul said
in a statement.
Shares of STX Pan Ocean closed at 11,850 won on the Seoul bourse, down 3.27
percent from Thursday's close.
pbr@yna.co.kr
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