Vapores Falls on Concern Costs Will Rise, Demand Slip

By Nathan Gill and James Attwood

     Aug. 20 (Bloomberg) — Cia. Sudamericana de Vapores SA, Latin America’s biggest container ship company, fell to the lowest in a month in Santiago trading on speculation that rising costs and falling demand will reduce earnings.
     Vapores declined 2 percent to 705 pesos, the lowest since July 22.
“There is a lot of uncertainty about future demand and the high cost of fuel,” Agustin Alvarez, head of research at Banco BICE in Santiago, said by phone today. “This, as well as lower-than-expected results reported by the company last week, foreshadow a complicated period for the company.”
     Vapores has lost 6.6 percent in the four days since saying in its quarterly earnings statement that global container ship building orders are at record highs and the “weakened” global financial system and rising global energy costs may extend into next year. Crude oil rose as a much as 2.2 percent in New York, signaling higher fuel costs for transport companies.

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