COSCO SHIPPING Development: net profit up 184.49% in 2021 as it seeks high-quality growth ...

COSCO SHIPPING Development: net profit up 184.49% in 2021 as it seeks high-quality growth by integrating its core edges

发布时间： 2022-04-01

COSCO SHIPPING Development (601866.SH/02866.HK, the "Company") released its 2021 results on the evening of March 30, 2022. The carrier earned RMB6.091 billion (+184.49% YoY) in net profit attributable to its shareholders and other equity holders on revenue of RMB37.118 billion (+83.95% YoY) in 2021. Basic EPS was RMB0.4979. The Board proposes to distribute a dividend of RMB0.226/share to its shareholders. Integrate core edges to seek a strong start during the 14th Five-year Plan period We have seen waves of Covid-19 pandemic globally in 2021, however, global economy started to recovery on the back of extensive vaccinations and implementation of stimulus plans across different economies. As a result, shipping demand remained strong, but port congestion, container shortage and other factors have strained the global supply chain. Amid global supply chain bottlenecks, COSCO SHIPPING Development worked to improve quality and boost efficiency, and achieved solid financial performance. The Company generated RMB9.461 billion in revenue from its leasing business, accounting for 25.45% of total revenue. Of which, RMB2.067 billion came from vessel leasing. In 2021, the Company continued to push forward its pulp vessel and dry cargo vessel project, and delivered 3 pulp vessels and 16 dry cargo vessels. Meanwhile, the Company has been steadily expanding external market, making new breakthroughs in vessel leasing and other transportation leasing. Revenue from container leasing, management and sales reached RMB5.977 billion, surging 37.00% YoY. In 2021, the Company leveraged the synergy from leasing and manufacturing to actively support the go-live of its container trading platform, making great breakthroughs in reefer container leasing. Also, the Company took advantage of business opportunities from new/old container trading to effectively improve asset performance, leading to higher quality and efficiency. Revenue from container manufacturing stood at RMB32.112 billion or 86.40% of total revenue, up 165.34% YoY. In 2021, the container market experienced a structural shortage. The Company closely monitored market dynamics and leveraged industrial chain synergies to overcome the raw material supply crunch and shortage of workers while complying with pandemic prevention and control measures. The Company improved the production efficiency through various proactive measures, provided strong support for the smooth operation of supply chains and significantly improved its own economic benefits. In 2021, the Company recorded sales of about 1.64 million TEU, up approximately 89.93% from a year ago. Meanwhile, the Company has put in place a sound full-process quality management system, and promoted "oil to water" technology. This has led to continued diffusion of green concept within the industry and supported healthy, sustainable development of the industry. On investment management business front, the Company continued to optimize strategic investments and financial portfolios. Meanwhile, the Company cultivated new businesses to support industrial upgrading by actively expanding into new energy area that is relevant to its shipping logistics business. In 2021, the Company put in great efforts to support China's 30/60 carbon goals (i.e., peak carbon emission by 2030 and carbon neutrality by 2060) and kicked off its electric ship project. In view of Yangtze River Economic Belt's priority on ecology and green development, the Company took the lead and coordinate related companies across the industrial chain to study the standardization of electric container ships on the main line of Yangtze River. The goal was to build a demonstration area for green, zero-carbon and smart shipping, thus facilitating the transformation of Yangtze River waterway transportation. Also, the Company worked to improve its capabilities to research, develop and manufacture battery packs for vessels. Combined with charging and battery swap networks across key waterways in China, the Company is committed to enable synergies within the electric ship industrial chain. Leveraged capital markets to effectively enhance its ability to create more value The Company offered shares to purchase related container manufacturing assets and became the world's second largest container manufacturer in 2021. Also, it raised RMB1.464 billion from a follow-on offer priced at RMB2.76/share. These financing activities have further integrated container manufacturing assets within the Group and helped created synergy across the industrial chain. As such, the Company can improve its geographic advantages and technological content of its container manufacturing assets, thus strengthening its core competitiveness. Meanwhile, these financings have effectively reduced the Company's debt-to-assets ratio and laid a solid foundation for high-quality growth. Consistent dividend payouts will facilitate sustainable development The Company is committed to protect the interest of our investors and promote long-term, sustainable growth. It will pay cash dividends to its shareholders for 4 years in a row, with dividend payout ratio consistently increasing year by year. This suggests the Company is willing to share earnings with its shareholders. In 2021, the Company distributed a total of about RMB650 million in cash dividends for 2020 to its A-share and H-share investors. The Board proposes to distribute a dividend of RMB0.226/share for 2021 to shareholders. The Company believes that sustainable development concept is the compass for global growth. In 2021, the Company put in great efforts to ensure smooth operation of supply chains and actively explore and invest in green industries. This has greatly helped the development of regional economy, the industry and the harmonious society. Observe market to grab opportunities and drive sustainable development In 2022, the Company will capitalize on opportunities arising from the trends of digitalized, green and smart shipping industrial chain. Also, it will continue to expand its leasing business and maximize the synergy of container leasing and manufacturing. The Company will leverage new technologies and digital innovations to explore how energy-saving technology can be applied to the electric ship industrial chain. In addition, the Company will strengthen risk management of various businesses and work hard to achieve high-quality, sustainable growth.