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The Group recorded a 7.4% increase in revenue to USD71.2 million for the second quarter ended 30 June 2017 ("2Q17"), from USD66.3 million in the corresponding quarter a year ago ("2Q16"). The improvement came mainly on the back of higher revenue contribution from its container shipping business segment.
Driven mainly by the increase in container volume handled from 298,100 TEUs in 2Q16 to 306,700 TEUs in 2Q17, container shipping revenue rose 9.9% to USD62.5 million, versus USD56.9 million in 2Q16.
Revenue from the bulk & tanker business declined 10.6% to USD7.3 million in 2Q17, from USD 8.1 million in 2Q16, on the back of a smaller tanker fleet year-on-year. The decline was partially mitigated by an improvement in vessel employment days and charter rates of the Group's bulk carriers.
In line with the rise in bunker prices and the level of business activity, cost of services rose 7.6% to USD66.0 million in 2Q17, compared to USD61.3 million in 2Q16.
In light of the above, gross profit grew 5.0% to USD5.3 million in 2Q17, from USD5.0 million in 2Q16. Gross profit margin remained at 7.4%.
Profit from operations grew by 15.7% to USD2.5 million, from USD2.2 million, on the back of declines in general & administrative expenses which was partially offset by a smaller foreign exchange gain and lower other operating income recorded in 2Q17.
Share of results from associate company/joint venture declined to USD0.2 million in 2Q17, from USD0.4 million a year ago, mainly due to share of loss from a joint venture company.
Overall, profit after tax for the Group improved 7.9% to USD2.0 million in 2Q17, from USD1.8 million in 2Q16.
Cash & bank balances decreased to USD40.1 million as at 30 June 2017, compared to USD54.1 million as at 31 December 2016, mainly due to loan repayment, payment of docking for a number of vessels and dividend payment during the quarter.
Assets held for sale increased to USD9.3 million as at 30 June 2017, from USD3.3 million as at 31 December 2016, on account of the Group's planned disposal of two container vessels and a chemical tanker. The Group expects to complete the disposal in the next 12 months.
The regional container shipping industry continues to face headwinds amid capacity and demand imbalance. Competition for cargo remains strong, resulting in intense pressure on freight rates, whilst bunker prices are expected to continue its rally in the near term.
The Group will continue to focus on maintaining its competitiveness in regional waters, while optimising asset utilisation and operational efficiency to strengthen itself for the challenges ahead.