Cosco Holdings profit slips 0.7pc to US$192.3 million, but sales up 7pc
COSCO SHIPPING Holdings third quarter net profit slipped 0
COSCO SHIPPING Holdings third quarter net profit slipped 0.7 per cent year on year to CNY1.35 billion (US$192.3 million), drawn on revenues that rose seven per cent.
Third quarter operating profit more than doubled to CNY1.57 billion, the company revealed in a stock exchange filing.
The company acquired 75 per cent of Orient Overseas (International) Ltd (OOIL). Combined, they are now the third-largest container shipping company in the world after Maersk and Mediterranean Shipping Co (MSC), according to Alphaliner.
Cosco operates a fleet of 502 containerships, with a total shipping capacity of 2,975,968 TEU. Cosco, OOCL, CMA CGM (including its APL brand) and Evergreen are members of the Ocean Alliance.
The company also has a terminals subsidiary called COSCO SHIPPING Ports, which reported its earnings separately.
In a quarterly report to the Hong Kong stock exchange, the company said in the first nine months of the year it has 'proactively responded to adverse external factors' and 'focused on improving the quality of shipping services, fully leveraged the advantages of scale and synergies after the acquisition of OOIL, and achieved relatively good operating results.'
Cosco noted it has completed the sale of the Long Beach Container Terminal in California as required by the US government when it acquired OOIL.
It said the sale of the terminal will be recorded in its fourth-quarter results, and as a result, 'It is anticipated that the accumulated net profit for 2019 of the group will increase significantly as compared to last year.'
The company handled a total of 92.2 million TEU in the first three quarters of 2019, representing a 5.3 per cent rise in volumes but this increase has not delivered improved profits for the Chinese state-owned operator.
Greater China accounted for 78 per cent of the company's volumes in the third quarter of 2019 with Qingdao Port International a standout performer, handling 5.4 million TEU, a rise of 8.6 per cent.
Meanwhile the repositioning of several ports by Liaoning Port Group upon its consolidation has resulted in the diversion of domestic trade from Dalian Container Terminal, resulting in a 16 per cent drop in throughput to 2.3 million TEU.
Throughput in overseas regions increased by 12.9 per cent to 7.2 million TEU, bolstered by a 15 per cent rise in volumes at Piraeus Container Terminal to 1.3 million TEU, aided by increased calls from the Ocean Alliance and THE Alliance.
With two new berths added in January 2019 in response to increasing regional demand, throughput of COSCO-PSA Terminal Private Limited in Singapore surged by 60 per cent to 1.3 million TEU.