SINGAPORE (THE BUSINESS TIMES) – Yangzijiang Shipbuilding posted a net profit of 1.6 billion yuan (S$339.6 million) in the first half, up 39 per cent from the same period the year before, despite a drop in vessel sales and trading revenue.
Revenue in the six months ended June 30 fell 20 per cent to 6.6 billion yuan. Core shipbuilding generated revenue of 4.8 billion yuan, down from 5.3 billion yuan in 2020, as 23 vessels were delivered instead of 28.
Trading revenue declined from 1.6 billion yuan to 321.9 million yuan, thanks to lower trading volume. But on the other hand, revenue from shipping logistics and chartering as well as ship design services was higher at 596.3 million yuan, up from 325.1 million yuan previously. This was due to an expanded charter fleet size and improved charter rates, the group said.
Gross profit margin for the shipbuilding business was 14 per cent, down from 16 per cent in the same period in the prior year due to rising raw material costs and a strengthening yuan against the dollar.
In the first half of 2021, the group set a record number of new orders for 112 new vessels, with a total contract value of US$6.67 billion (S$9 billion). This contributed to its “unparalleled outstanding order book” of US$8.7 billion for 167 vessels, said Yanzijiang on Thursday night (Aug 5).
Mr Ren Letian, group executive chairman and chief executive, described 2021 as Yangzijiang’s “best year” in terms of the value of contract wins and outstanding order book.
He added that it is a priority of the group to create “a positive impact on the shipping industry and be part of the advancement towards its carbon neutrality goals”.
In 2021, he noted, the group secured its first batch of 40,000 cubic m LPG (liquefied petroleum gas) vessels and LNG (liquefied natural gas) dual-fuel 7,000 TEU (twenty-foot equivalent unit) container ships. Both of these are “unprecedented” in the group’s ship-building history, he said.
“This represents the group’s commitment towards environmental sustainability and we look to further solidify our competitive advantages in the LNG market and play our part against climate change.”
Earnings per share was 42.58 fen, down from 30.05 fen in the first half last year.
Net asset value per share was 860.52 fen as at June 30.
Yangzijiang shares rose on Friday after its earnings announcement. They were trading up seven cents, or 4.9 per cent, to $1.51 as at 2.45pm.