Investor confidence pays off as profits surge at Guangzhou yard.

(From Lloyds List)

Byline: Company riding high on shipbuilding boom, writes Keith Wallis in Hong Kong

GUANGZHOU Shipyard International has justified continued investor confidence by reporting a 199% rise in net profit to Yuan293.6m ($37.9m) last year from Yuan98.19m in 2005, based on Chinese reporting standards. Turnover climbed 21.74% to Yuan3.32bn against almost Yuan2.73bn a year earlier.

The company, 35.71% owned by China State Shipbuilding Corp, said the increase reflected higher shipbuilding prices and better profit margins.

Under Hong Kong accounting standards net profit rose 97.5% to Yuan266.6m.

The Hong Kong-listed company has been a darling among investors for more than a year with the stock rising more than sixfold.

A year ago the share price stood at HK$4. On Friday the counter closed at HK$24.50 although this was down 1% on the day.