Leading market share in the relatively stable intra-Asia container shipping market. Weakened profitability amid ongoing industry downturn. Satisfactory trade route diversity and operating efficiency. High industry risk with chronic oversupply and intense competition. Modest debt leverage. Relatively conservative financial policy and expansion strategy compared with long-haul peers. Strong liquidity. Significant volatility in the company's cash flow coverage ratios. The negative rating outlook on Wan Hai Lines Ltd. reflects our assessment of material risk that the company's profitability could remain relatively weak over the next 12 months due to lingering industry oversupply, despite some recent recovery in freight rates. Our base case expects Wan Hai's profitability to experience a mild improvement in 2017 through freight rate recovery, driven by the more
