Cosco's 2020 net profit soars fourfold to US$2b on strong demand
CHINA'S Cosco Shipping Holdings posted a fourfold increase to CNY13.2 billion (US$2 million) last year, up from CNY3 million the year prior, the carrier said in its annual results announcement.
The company attributed the surge in net profit to the addition of an extra 40 ships to its fleet amid a rebound in demand and freight rates, reports IHS Media.
Group revenues from continuing operations including container shipping and ports rose to CNY171.3 billion last year, up from CNY150.5 billion. The figures include revenues from container shipping which climbed 14.6 per cent to CNY166 billion.
The result means Cosco joins other carriers including Maersk, Hapag-Lloyd, CMA CGM, and Zim Integrated Shipping Services in posting strong profit figures over the last few months due to the rebound in rates and volumes in the second half of 2020.
The company, which has a dual listing in Shanghai and Hong Kong, gave no breakdown of the profit split between its liner businesses, Cosco Shipping Lines and Hong Kong-headquartered OOCL. However, figures from OOCL's results released recently show OOCL was the most profitable jewel in the Cosco crown, contributing about CNY7 billion to net profit and about CNY54 billion to group revenue.
By comparison, Cosco Shipping Lines generated a net profit of about CNY5 billion on revenues of CNY112.1 billion last year, which were up 13.8 per cent year on year.
Cosco said total liftings climbed 2.4 per cent to 26.3 million TEU. OOCL saw the biggest increase, posting a 7.3 per cent rise in liftings to 7.4 million TEU, while Cosco Shipping Lines handled 18.9 million TEU, up 0.5 per cent.
Cosco Shipping Ports contributed about CNY2.6 billion to net profit on revenue of CNY7 billion, compared with net profit of CNY2.4 billion and CNY7.2 billion in revenue in 2019. Total throughput was virtually unchanged at 123.8 million TEU.
"In the second half of 2020, the company took the opportunity of the container shipping market's recovery and added 40 vessels to its global routes, and guaranteed its shipping capacity during the recovery period," Cosco said. The company said it had a total fleet of 536 ships with a shipping capacity of 3,073,684 TEU at the end of 2020, up 3.6 per cent compared with the end of 2019.
Commenting on the outlook this year, the company said the Covid-19 pandemic "has shuffled global industrial patterns and business models, which would present new opportunities to develop a global container logistics supply chain."
It also warned the recovery in the world economy post-coronavirus disease "could be unstable and uneven" with "risks and challenges still posed to medium- and long-term growth."