WAH Kwong Shipping Holdings has ordered three new ships costing $480 million from Chinese yards and taken options on another two, managing director George Chao said. Speaking after the company's annual meeting, he said the new orders - one product tanker of 44,000 tonnes and two bulk carriers of 27,000 tonnes each - will be delivered in 1996. The new ships are in addition to the two 27,000-tonne log carriers ordered from Hudong Shipyard in Shanghai in June for US$18.5 million each. Six older vessels were sold for HK$300 million over the past four months to reduce the average age of the company's fleet. The vessels - Arrow Venture, Chemical Venture, Hokuetsu Venture, Radian Venture, Sovereign Venture and Venus Venture - were built between 1976 and 1981. ''The shipping market is improving and we thought it was a good time to renew the fleet,'' Mr Chao said. ''Normally summer months are slow, but this year the freight rates are improving because of increasing demand from the United States and Europe which are coming out of recession.'' However, he said, demand for very large crude carriers remains flat because of oversupply following new tonnage coming onto the market recently and the slowing pace of scrapping. The company stopped scrapping ships in China following the imposition of a 15 per cent value added tax (VAT) this year. ''Wah Kwong's 10 per cent to 15 per cent profit margin on scrapping evaporated after the imposition of the VAT,'' Mr Chao said. He said the company's property interests would be concentrated in Shanghai, which was considered a good market by the Chao family, Wah Kwong's largest shareholder. Work started last month on a 125,000 square metre commercial complex in the city. Mr Chao said 25 per cent of the 40,000 square metre first phase of the development had been pre-sold. About 50 per cent of flats in the group's joint venture in Shanghai, Wah Tai Mansion, have been pre-sold, with the price having increased by more than 10 per cent since May. The company declared a profit of $290 million for the year ended March. Yesterday, shareholders approved a share buy-back mandate and payment of a final dividend of 39 cents a share, making a total of 50.7 cents for the year.