Vietnam National Shipping Lines (Vinalines) said that it continued to suffer a VND1.439 trillion ($69.2 million) loss in the first half of 2012 due to falling demand for freight transportation.

The total output of freight transportation reached 15.3 million tons in January-June, down 15 percent over the same period last year.

Its total revenue reached VND11.614 trillion, down 3 percent year on year.

The loss caused by two former Vinashin’s subsidiaries alone, Vinashin Lines Co Ltd and BISCO, amounted to around half of the sum, or some VND700 billion, said Vinalines.

Moreover, the losses at Falcon Shipping Co (Falcon) and Vietnam Ocean Shipping Joint Stock Company (VOSCO) were VND267 billion and VND102.7 billion respectively.

Explaining the cause of a loss, Vinalines added that in addition to falling demand, freight charges are also in a downtrend for a long time.

As a result, the local shipping industry had to cope with the excess tonnage supply in most markets.

Besides, Vinalines must also address its internal difficulties during the same period, it said.

The State Audit of Vietnam has found that Vinalines invested VND672 billion, or 10.37 percent of ist chartered capital, into non-core areas in 2010, according to a state budget auditing for 2011codnucted by the agency.

The loss-ridden giant shipping firm, whose former chairman is wanted for economic offences, is currently burdened with a total debt of more than VND43 trillion ($2 billion), according to a government report submitted to the National Assembly last month. 

As of the end of last year Vinalines had total assets worth VND55.85 trillion, and VND9.41 trillion worth of equity, according to the report.

Short-term unsettled debt of the debt-stricken shipping line stood at VND9.3 trillion, and long-term, VND33.82 trillion.

Of these, VND34.55 trillion come from its ineffective investment in buying vessels, constructing seaports, and shipyard activities. The company also had an overdue debt of VND207 billion.

Source: Tuoi Tre