China train maker signs $395m contract after crash

The Chinese state-owned company that made the trains involved in a deadly crash last month has signed a 2.54 billion yuan ($395 million) contract to provide trains to Turkmenistan. China South Locomotive and Rolling Stock Corp (CSR) signed the deal "recently" and is due to start delivery to the central Asian country in 21 months, the company said in a statement Monday. This is the second major order announced by CSR after a high-speed train crash near the eastern city of Wenzhou on July 23 killed 40 people and injured nearly 200 others. The company said on July 28 that it had received six contracts to provide locomotives worth 6.9 billion yuan -- or 10.6 percent of its 2010 revenue -- to unnamed local and overseas firms. China is keen to market its high-speed rail technology overseas, but the accident has raised fears such sales could be hampered. Shanghai-listed shares of CSR -- whose joint venture with Canadian firm Bombardier made both trains -- have dropped over 20 percent since the accident, which sparked concern over the safety of China's fast-growing high-speed network. A government investigation later blamed the crash on faulty signalling equipment. CSR nevertheless postponed a shareholders' meeting originally planned for August 5, which was intended to vote on an 11-billion-yuan private placement to raise new funds. The company said the meeting had been rescheduled for September 29 so that it could communicate fully with its investors about the prospects of the firm and the industry. CSR posted a net profit of 2.04 billion yuan in the first half of the year, up 85 percent from the previous year on strong demand for high-speed rail equipment. Revenue jumped 42 percent to 40.12 billion yuan in the period.