BEIJING -- China CSSC Holding Ltd, the listed arm of China's largest shipbuilder, said Saturday that its profits will likely shrink by 95 to 100 percent year-on-year in 2012 as the result of a sluggish shipping industry.

The Shanghai-based firm said in a statement filed to the Shanghai Stock Exchange that the slump will largely be attributable to a substantial decline in newbuilding prices amid a lingering shipping downturn.

The company's net profits hit 2.52 billion yuan ($400 million) in 2011, while earnings per share stood at 2.12 yuan.

China's shipping industry has been on the decline following a brief recovery in 2010, as the industry has been hit by a supply and demand imbalance and rising operating costs.

The Shanghai International Shipping Institute, an industry research and consulting organization, said in a report issued Wednesday that the downturn is likely to continue in the first quarter of the year.