China Cosco Shipping’s energy shipping unit returned to the black for the first quarter, supported by firm VLCC rates and higher LNG earnings.
Shanghai and Hong Kong-listed Cosco Shipping Energy Transportation (CSET) has reported a net profit of CNY 428m ($63.6m) compared with a net loss of CNY 86.5m during the first quarter of 2018.
Revenues rose to CNY 3.85bn from the year-ago level of CNY 2.41bn.
“Tanker earnings were boosted by US exports and the longhual trades between Venezuela and Asia. We took advantage of the VLCC market recovery and did more triangular trade,” CSET said.
Having taken delivery of three LNG carriers, the company saw its pre-tax profits in LNG shipping increase to CNY 138m in January-March—up 89.7% year-on-year.
Other listed units of Cosco Shipping with strong exposure to box shipping also managed to post profits last quarter.
Cosco Shipping Development, the group’s financing arm, posted a net profit of CNY 596m for January-March versus the year-ago profit of CNY 281m.
This was mainly due to accounting gains, as the company recorded higher values for its vessels and containers due to firm steel prices, according to a regulatory filing.
CSD expects to book net profit of CNY 220m for the whole of this year because of the asset appreciation.
Revenues amounted to CNY 3.2bn in the first quarter, down 12.1% year-on-year.
Cosco Shipping Holdings, which controls Cosco Shipping’s container shipping and terminal businesses, saw its net profit in the same period rise to CNY 687m from CNY 181m a year earlier.
This was due to higher box shipping rates and its acquisition of Orient Overseas (International) Ltd.
