Lloyd's List is part of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC’s registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

This copy is for your personal, non-commercial use. For high-quality copies or electronic reprints for distribution to colleagues or customers, please call UK support at +44 (0)20 3377 3996 / APAC support at +65 6508 2430

Printed By

UsernamePublicRestriction
UsernamePublicRestriction

Improved tanker market strengthens China state oil shipping firms

Both of the energy shipping arms owned by Cosco Shipping and China Merchants reported better performance in the third quarter. But the former’s prospects are overshadowed by the US sanctions on part of its tanker fleet

CSET and CMES enjoyed better tanker rates in the third quarter, while the latter’s bottom line was also boosted by its large exposure in the dry bulker sector

CHINESE state-owned energy shipping firms, which together operate a combined fleet of over 100 very large crude carriers, have posted improved results in the third quarter.

Cosco Shipping Energy Transportation posted Yuan113.9m ($16.2m) net profit in the three months to September 30, reversing the year-ago losses of Yuan53.5m. Revenue increased almost 6% to Yuan3.4bn.

The Shanghai- and Hong Kong-listed oil and gas shipping arm of state giant China Cosco Shipping Corp controls a live tanker fleet of 151 ships, including 52 very large crude carriers, while holding stake in 32 liquefied natural gas carriers of 147,000 cu m-174,000 cu m in service.

Shanghai-listed China Merchants Energy Shipping, part of another state conglomerate, China Merchants Group, saw net profits doubled year on year to Yuan248.6m in the three months. Revenue jumped 26% to Yuan3.4bn.

It has 52 VLCCs in addition to the other 150 ships in its fleet on the water, including a large number of dry bulkers with 31 very large ore carriers, and 19 LNG carriers co-owned with CSET and other foreign partners.

Both companies said they had enjoyed an improved tanker market during the period, while CMES’s bottom line was also boosted by a rebound in the dry bulker market.

Investors appeared more impressed by the performance of CMES, whose share price closed at Yuan5.51 per unit on Thursday, up 2.8%. CSET’s stock value, at the same time, dropped 4.4% to Yuan5.85.

Analysts said the difference was partly because CMES outperformed CSET on probability, and partly because the latter company’s prospects had been overshadowed by the US sanctions on its subsidiary Cosco Shipping Tankers (Dalian).

The blacklisted unit owns 43 oil tankers, including 26 VLCCs. The restrictions on the operation of these vessels will take a toll on CSET’s ability to benefit from the expected tanker peak season in the fourth quarter.

Related Content

Topics

UsernamePublicRestriction

Register

LL1129776

Ask The Analyst

Please Note: You can also Click below Link for Ask the Analyst
Ask The Analyst

Your question has been successfully sent to the email address below and we will get back as soon as possible. my@email.address.

All fields are required.

Please make sure all fields are completed.

Please make sure you have filled out all fields

Please make sure you have filled out all fields

Please enter a valid e-mail address

Please enter a valid Phone Number

Ask your question to our analysts

Cancel