COSCO SHIPPING Holdings Announces 2019 Annual Results

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COSCO SHIPPING Holdings Co., Ltd. announced its 2019 annual results.

In 2019, global economic and trade situation faced severe challenges. Economic growth had hit a new low since the financial crisis, and the demand growth in container shipping had slowed year-on-year. However, in the face of challenges, COSCO SHIPPING Holdings adhered to the guiding principle of “outperform the market, drive innovation, and lead the era” and the Ocean & Plus strategy, deeply facilitating various work including globalization, quality improvement, digitalization and end-to-end business development. Through the collaboration of the dual-brand fleets and the cooperation between port and shipping operations, the Company continued to improve quality and efficiency and realized synergies in various aspects, which significantly improved the Company’s operating performance compared with the same period of the previous year.

During the Period, according to China Mainland Accounting Standards, the revenue of the Company reached RMB151.06 billion, up by 25.0% year-on-year. The net profit attributable to equity holders of the Company amounted to RMB6.76 billion, representing a year-on-year increase of RMB5.53 billion or 449.9%, and the basic earnings per share amounted to RMB0.56 per share. Net profit attributable to equity holders of the Company after deduction of non-recurring amounted to RMB1.59 billion, representing a year-on-year increase of RMB1.40 billion or 732.8%.

During the Period, for the “dual-brand” container shipping business, the Company handled shipping volume of 25,739,103 TEUs, up by 18.1% as compared to 2018, if on the comparable basis, representing a year-on-year increase of 2.7%. Among which, COSCO SHIPPING Lines handled the shipping volume of 18,784,961 TEUs, representing a year-on-year increase of 2.3%, and Orient Overseas Container Line Limited (OOCL) handled the shipping volume of 6,954,142 TEUs, representing a year-on-year increase of 3.8%. COSCO SHIPPING Ports achieved a total throughput of 123.78 million TEUs, representing a year-on-year increase of 5.5%.

Benefited from the significantly improved operating results and the approximately RMB7.7 billion raising through the A-share private placement in the beginning of 2019, the Company’s financial situation has been further improved, and the financial foundation has been further consolidated.

In 2019, COSCO SHIPPING Holdings adhered to the globalization strategy and keenly grasped opportunities in the market. On the basis of maintaining the competitive advantages of the major east-west services, the Company optimized and adjusted its capacity allocation structure and cargo structure to improve presences in emerging markets and regional markets. The cargo volume of the Company’s container shipping business in emerging markets and non-China markets increased by 7.0% and 7.9% year-on-year respectively, much higher than the overall volume growth rate on the comparable basis(2.7%). The ratio of the Company’s non-China cargo volume to the total foreign trade volume increased from 35.5% in 2018 to 37.0%. The Company further consolidated its foundation for global development and enhanced its ability to resist regional and periodic risks.

The Company actively promoted the construction of digital shipping. In July 2019, CargoSmart, a subsidiary of COSCO SHIPPING Holdings announced the execution of Global Shipping Business Network (GSBN) services agreements with other maritime industry operators. Under these agreements, each signatory commits to establish the GSBN, a non-profit joint venture to accelerate the digital transformation of the shipping industry. In early 2020, all parties concerned signed the GSBN Shareholder Agreements. GSBN will be formally established and put into operation after completing all the regulatory approval procedures, while CargoSmart will provide technical solutions and platform operation services.

During the Period, the Company actively responded to international environmental protection conventions, implemented the concept of green shipping, and built a sustainable business model.

Since the beginning of 2020, facing the sudden outbreak of COVID-19, COSCO SHIPPING Holdings has actively fulfilled its social responsibilities and made every effort in the epidemic prevention and control, which effectively protected the life, health and safety of its on-shore and off-shore employees and ensured the business operation smooth and orderly. For strikingly fighting against the epidemic, the Company coped with the difficult situation to give priority to ensure the transportation of supplies for epidemic prevention and the living in the epidemic areas by providing the “Green Channel”. Furthermore, the Company made full use of the advantages of extensive network and resource integration capabilities to ensure the stable operation of the global container logistics supply chain based on customer-oriented philosophy.

Looking forward to 2020, the Company will pay close attention to challenges brought by COVID-19 to the global economy and shipping market. While boosting confidence, the Company will continue to focus on high-quality development, innovative development and coordinated development, and keenly grasp opportunities in the industry to continuously optimize the Company’s international development path in the fast-changing environment. In addition, the Company will initiatively integrate internal and external resources to enhance the core competitiveness of high-quality development and improve the ability to continuously serve customers worldwide.

In terms of high-quality development, the Company will firmly advance the global route network layout and the construction of the global terminal network in order to continuously improve service quality and customer experience. Meanwhile, the Company will continue to consolidate the advantages of low-cost development and strengthen cost control in key areas.

In terms of innovative development, the Company will comprehensively deepen enterprise reform and innovation, release development vitality, actively promote the construction of digital network and strengthen the capability of service integration to constantly improve management efficiency and customer experience.

In terms of coordinated development, the Company will deepen the mechanism of collaboration and integration and stick to the dual-brand operating mode. The Company will continue to promote industrial chain collaboration, especially the synergy between ports and shipping businesses.

In the future, COSCO SHIPPING Holdings will continuously endeavor to build the Company as a top-tier integrated container shipping service provider, to create value and returns for customers and shareholders, and achieve win-win and common development with all parties.

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