COSCO Shipping International is expecting to report a net loss in the FY2022 ended December with a “significant deterioration” in profit during the year.
The loss was due to a non-cash impairment of goodwill in connection with the group’s investment in Cogent Holdings Pte. Ltd. (formerly known as Cogent Holdings Limited). Cogent Holdings was compulsorily acquired by COSCO Shipping for $490 million in 2018.
“In accordance with the Singapore Financial Reporting Standards, the management of the company performed an annual impairment assessment on the goodwill and concluded that an impairment was required for FY2022. The amount to be impaired has been assessed to be $99 million,” says COSCO in its Feb 15 statement.
For the FY2021 ended Dec 31, 2021, the group reported a 261% y-o-y surge in its earnings of $30.1 million, lifted by the gain on disposal of its 60% equity interest in its shipping subsidiary.
The group will release its full results around March 1.
Shares in COSCO closed 0.2 cent lower or 1.03% down at 19.3 cents on Feb 15.
Source: The Edge Singapore