COSCO SHIPPING Holdings Co., Ltd.

Transcription

1 Stock Code: SH / 1919.HK 31 August 2017 COSCO SHIPPING Holdings Co., Ltd Interim Results

2 Contents Highlights Financial Review Market & Business Review Very Substantial Acquisition Market Outlook 1

3 Highlights 2

4 dedicating to enhance quality and profitability Revenues from Continuing operations RMB(bn) % YoY Profit attributable to equity holders of the Company RMB(bn) 1.86 an increase of 9 billion Net Cash generated from operations RMB(bn) 1.78 an increase of 1.7 billion Liftings from container shipping business Thousand TEU 9, % YoY Unit Income of all shipping routes RMB(yuan) 3, % YoY Total Throughput from terminal business Million TEU % YoY 3

5 for building a world-class enterprise Transaction illustration Transaction overview controlling shareholder public shareholders 68.7% 31.3% cash shares Joint Offerors CSH SIPG COSCO SHIPPING Holdings and SIPG have made a preconditional voluntary general offer as Joint Offerors to acquire up to 100% of the issued shares of Orient Overseas (International) Limited at an offer price of HKD The controlling shareholder of OOIL has irrevocably undertaken to accept the offer in respect of the 68.7% of OOIL shares held. 100% COSCO SHIPPING Lines OOIL(0316.HK) Shareholding structure after acquisition Container shipping CSH(A+H) ( SH / 1919.HK) controlling shares OOIL(0316.HK) 46.72% COSCO SHIPPING Ports (1199.HK) Terminal The making of the offer is subject to approval from COSCO SHIPPING Holdings shareholders, PRC regulatory approvals, as well as anti-trust approvals in the relevant jurisdictions. Prior to the completion of the offer, OOCL and COSCO SHIPPING Lines shall continue to adhere to the requirements of relevant regulatory bodies, comply with international anti-trust and anticompetition regulations, and continue to operate independently under the Ocean Alliance framework. After the completion of the Offer, the Joint Offerors intend to retain the listing status of OOIL, and maintain OOIL s global headquarters functions and presence in Hong Kong and continue to support Hong Kong as a global maritime center. The Joint Offerors intend to keep the existing OOIL branding so that the Joint Offerors and OOIL can provide customers with more diversified product offerings and better service experience, as both parties explore ways to achieve synergies and better operational efficiency. 4

6 grasping the the Belt and Road advantages Leveraging the route-port linkage advantage, we are dedicating to improve the global layout by taking advantages of the Belt and Road initiative, providing more extensive and convenient services for our customers as well as committing to promote the economic and social development of countries and regions by interconnection. Shipping routes Locations of invested ports 5

7 Financial Review 6

8 Consolidated Income Statement 1H 2017 RMB(mn) 1H 2016 RMB(mn) YoY(%) Revenues 43,446 29, Cost of services (39,695) (31,205) Gross profit/(loss) 3,751 (1,364) - Gross profit/(loss) margin (%) PPs Other income/(expense), net 1 2, Selling, administrative and general expenses (2,004) (1,712) Operating profit/(loss) 4,468 (2,998) - Net finance costs (1,113) (976) Share of profits less losses of JVs and associates Profit/(loss) before income tax 4,078 (3,315) - Income tax expenses (677) (291) Profit/(loss) from continuing operations 3,401 (3,606) - Profit/(loss) from discontinued operations - (3,139) - Profit/(loss) for the year 3,401 (6,744) - Profit/(loss) attributable to equity holders of the Company 1,863 (7,169) Basic earnings/(loss) per share 0.18 (0.70) - 1. In the first half of 2017, Shanghai China Shipping Terminal Development Co., Ltd., a subsidiary of the Group, acquired additional 16.82% equity interests in Qingdao Port International Co., Ltd., at a consideration of 20% equity interests disposed in Qingdao Qianwan Container Terminal Co., Ltd. plus cash, resulting in other income of RMB2,150,432,000. 7

9 Segment Results Segment Revenues (from external customers) 1H 2017 RMB(mn) 1H 2016 RMB(mn) YoY(%) Terminal shipping and related business, 3.7% Container shipping and related business 41,826 28, Terminal and related business 1,620 1,660 (2.4) Container shipping and related business, 96.3% Segment profit/(loss) 1H 2017 RMB(mn) 1H 2016 RMB(mn) YoY(%) Container shipping and related business 1,652 (3,458) - Terminal and related business 3, In the first half of 2017, Shanghai China Shipping Terminal Development Co., Ltd. acquired additional 16.82% equity interests in Qingdao Port International Co., Ltd., at a consideration of 20% equity interests disposed in Qingdao Qianwan Container Terminal Co., Ltd. plus cash, resulting in other income of RMB2,150,432,000. 8

10 Consolidated Balance Sheet 2017/6/30 RMB(mn) 2016/12/31 RMB(mn) Change(%) Current assets 39,210 45,362 (13.56) Non-current assets 85,054 74, Total assets 124, , Current liabilities 40,016 33, Non-current liabilities 42,647 48,549 (12.16) Total liabilities 82,663 82, Equity attributable to the equity holders of the Company 20,373 18, Total equity 41,601 37, Total borrowings 57,326 57,377 (0.089) minus: Cash and cash equivalents 24,699 32,189 (23.27) Net debt 32,627 25, Net debt to total equity ratio(%) PPs 9

11 Consolidated Cash Flow Statement 1H 2017 RMB(mn) 1H 2016 RMB(mn) YoY RMB(mn) Net cash (used in)/generated from operations 1, ,701 Net cash used in investing activities 1 (8,290) 7,401 (15,691) Net cash generated from/(used in) financing activities (633) (6,700) 6,067 Net cash inflows in the year (7,141) 781 (7,922) Net related exchange gain/(loss) (349) 391 (740) Net increase in cash and cash equivalents (7,490) 1,173 (8,663) Cash and cash equivalents as at 1 January 32,189 33,897 (1,709) Cash and cash equivalents as at 30 June 24,699 35,070 (10,371) 1. In the first half of 2017, a cash of RMB5,575,059,000 was paid for purchasing fixed assets, intangible assets and other long-term assets, as well as a cash of RMB3,087,326,000 was paid for investment. 10

12 Market & Business Review 11

13 a slow and steady recovery from trough CCFI (China Container Freight Index, since 2007/1/1) ( ) Average: 1000 Historic Low: 632 (29th Apr, 2016)) 300 Jan-2007 Jan-2008 Jan-2009 Jan-2010 Jan-2011 Jan-2012 Jan-2013 Jan-2014 Jan-2015 Jan-2016 Jan CCFI(since 2017/1/1) In the first half of 2017, the container shipping market kept a slow and relatively steady recovery after hitting a historic low in YTD highest: 878 (3rd Feb, 2017) YTD lowest: 778 (24th Mar, 2017) Source: Shanghai Shipping Exchange 600 Jan-2017 Feb-2017 Mar-2017 Apr-2017 May-2017 Jun-2017 Jul-2017 Aug

14 much better than the last year In the first half of 2017, CCFI was 19.8% higher year-on-year, and up 13.6% relative to the second half of H 2017 CCFI Avg.: H 2016 CCFI Avg.: H 2016 CCFI Avg.: Jan-2016 Apr-2016 Jul-2016 Oct-2016 Jan-2017 Apr-2017 Jul-2017 Source: Shanghai Shipping Exchange 13

15 freight rate of trunk routes improved SCFI - Shanghai to Europe/Med. (USD/TEU) SCFI - Shanghai to USWC/USEC (USD/FEU) 欧洲 ( 基本港 ) 地中海 ( 基本港 ) 美西 ( 基本港 ) 美东 ( 基本港 ) Jul-15 Jan-16 Jul-16 Jan-17 Jul Jul-15 Jan-16 Jul-16 Jan-17 Jul-17 Source: Shanghai Shipping Exchange 14

16 bunker price surged year-on-year Bunker Price (SGP 380CST) H 2016 USD193/ton 1H 2017 USD314/ton (+62.4% YoY) Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 15

17 organic capacity growth Fleet capacity 1 as at 30 th Jun 2017 reached 342 vessels / 1,764,565 TEUs, representing a 7% growth as compared with the beginning of this year, with average fleet age of 9.1 years and average fleet capacity of 5,160 TEUs. COSCO SHIPPING Lines operating 1 owned chartered-in Combined ordered Combined order book Capacity (TEU) - 94,910 94, , ,308 15,000 Vessels Capacity (TEU) 187, , , , ,328 10,000 15,000 Vessels Capacity (TEU) 36, , ,328 9, ,420 8,000-10,000 Vessels Capacity (TEU) - 13,847 13,847-13,847 6,000-8,000 Vessels Capacity (TEU) 179, , , ,545 4,000-6,000 Vessels Capacity (TEU) - 61,725 61,725-61,725 2,000-4,000 Vessels Capacity (TEU) 14, , , ,122 <2,000 Vessels Total Capacity (TEU) 417,224 1,347,341 1,764, ,730 2,299,295 Vessels Chartered-out capacity ( 8 vessels/ 38,618 TEUs) not included. Ships owned and chartered ratio(by TEU) 23.6% 76.4% 自有 Owned 租赁 Chartered-in 16 Owned capacity change in 1H 2017 No. of Vessels Capacity Scrapped 0 0 Deliveries 3 27,276

18 global ranking by fleet capacity Top liner companies (existing capacity) (million TEU) Top liner companies (existing capacity + order book) (million TEU) APM Maersk APM Maersk MSC MSC CMA CGM CMA CGM COSCO SHIPPING Lines COSCO SHIPPING Lines Hapag Lloyd Hapag Lloyd Evergreen Evergreen OOCL OOCL Yang Ming Yang Ming Hamburg Süd Hamburg Süd NYK Line NYK Line MOL MOL PIL PIL Zim Zim Hyundai M.M Hyundai M.M K line K line 0.49 Three Japanese carriers declared the integration plan of their container shipping businesses on 31st Oct, 2016 Maersk announced the acquisition of Hamburg Süd on 1st December, 2016 COSCO SHIPPING Holdings have made a pre-conditional voluntary general offer to all shareholders of OOIL on the 9th of July 2017 Source: Alphaliner August 2017, Company data 17

19 container shipping liftings Breakdown by routes ( 000 TEU) 1H H 2016 YoY(%) China; 29.9% Transpacific; 15.1% Cargo Volume 9,998 7, Asia-Europe (including Med.); 20.5% Other international market (including Atlantic Ocean); 8.3% Intra-Asia (including Australia); 26.2% 1H 年 1-6 月份 H 2017 年 1-6 月份 3,000 2,990 2,624 2,500 2,000 2,047 2,057 2,118 1,500 1,505 1,604 1,113 1, Other international 跨太平洋亚欧 ( Asia-Europe 包括地中海 ) 亚洲区内 Intra-Asia ( 包括澳洲 (including Transpacific ) 其他国际 market ( 包括大西洋 (including ) 中国 China (including Med.) Australia) Atlantic Ocean) 18

20 revenue generated from routes Breakdown by routes 1 RMB(million) 1H H 2016 YoY(%) Routes revenue 36,902 23, Other international market (including Atlantic Ocean); 10% China; 15% Transpacific; 28% 12,000 10,000 10,618 9, H 2016 年 1-6 月份 H 2017 年 1-6 月份 Intra-Asia (including Australia); 21% Asia-Europe (including Med.); 26% 8,000 7,427 7,832 6,000 5,713 5,322 5,767 4,000 3,894 4,217 2,000 1, ,000 跨太平洋亚欧 ( Asia-Europe 包括地中海 ) 亚洲区内 Intra-Asia ((including 包括澳洲 ) 其他国际 Other ( international 包括大西洋 ) 中国航线之间内部交易抵消 Transpacific China (including Med.) Australia) market (including Elimination Atlantic Ocean) The diagram does not contain Elimination 19

21 unit income (RMB per TEU) 1H H 2016 YoY(%) Unit Income of international routes 4,574 3, Unit Income of domestic routes 1,726 1, Unit Income of all routes 3,691 3, H 2016 年 1-6 月份 H 2017 年 1-6 月份 8,000 7,000 6,670 7,054 6,000 5,000 4,743 4,685 4,000 3,000 3,561 2,588 2,985 3, % 2,000 1,787 1,726 1,000 - 跨太平洋亚欧 ( 包括地中海 ) 亚洲区内 ( 包括澳洲 ) 其他国际 Other ( international 包括大西洋 ) 中国 Transpacific Asia-Europe Intra-Asia (including market (including China (including Med.) Australia) Atlantic Ocean) 20

22 more competitive unit cost Shipping routes cost RMB(mn) 1H H 2016 YoY(%) Equipment & Cargo Costs 18,945 15, Voyage Costs 7,909 4, Vessel Costs 7,430 6, Total 34,284 26, Shipping routes unit cost RMB(yuan) 1H H 2016 YoY(%) Equipment & Cargo Costs 1,895 2, Voyage Costs Vessel Costs Total 3,429 3, Vessel Costs; 22% Routes cost breakdown 4,000 3, ,429 3,516 2,000 1,895 1,000 Voyage Costs; 23% Equipment & Cargo Costs; 55% - Equipment & Cargo Costs (unit) 21 Voyage Costs (unit) Vessel Costs (unit) 1H H 2016

23 OCEAN Alliance enters into smooth running Global footprint: Ocean Alliance provides 41 services and 595 port pairs covering Trans Pacific, Europe, Middle East, Red Sea and the Transatlantic. Capacity: an estimated 350 vessels, 3.5 million TEU capacity with the average size of 10,051TEU, pouring new momentum into global trade. Swift delivery: The shortest delivery time from Shanghai respectively to Djibouti(19Ds), Dubai(17Ds), Abu Dhabi(20Ds), and Dammam(21Ds). Reliable cooperation: On April 1, 2017, the first 5-years-phase of the cooperation was triggered. If parties agree, the agreement will continue for another five years. Customers First, always: Jointly set up a Call Center, providing a rapid response catering to customer demand. 22 We Deliver Value: OCEAN Alliance offers unmatched valuable services with more convenient options such as NEW direct services from Middle East and SE.Asia to Piraeus in Greece to provide customers with more efficient, lower-cost and more diversified experiences.

24 optimized terminal portfolio As for terminal business, we continued to optimize our terminal portfolio and enhance their management. We owned and operated 162 container berths in 32 ports around the world with total annual handling capacity of million TEUs. Rotterdam Bilbao Valencia Vado Khalifa 23

25 stable increase in total throughput The total terminal throughput was million TEUs, representing an increase of 11.8% as compared to the same period of last year. Breakdown YoY Breakdown 000 TEU 000 TEU 8, % 17.0% 1.4% 6, % 31.1% 11,623 12, % 海外 Overseas 西南沿海 S.W. Coast 珠三角 Pearl River Delta 东南沿海及其他 S.E. Coast 5.7% 2,115 2, % 长三角 Yangtze River Delta 环渤海 Bohai Rim 24.9% 9,306 9, % 19.9% Bohai Rim +2.7% 1 2 7,432 7, % H 年 月 H 年 月 1. Excluding the throughput of Qingdao Qianwan Container Terminal Co., Ltd. for the first half of Excluding the throughput of Qingdao Port International Co., Ltd. for May to June

26 Very Substantial Acquisition 25

27 riding on industry trends CSAV and Hapag - Lloyd completed the consolidation CMA-CGM announced the acquisition of NOL, and completed a full takeover on September 2, 2016 Hapag - Lloyd and UASC announced an agreement on the merger. The two companies completed the merger on 24 th May, 2017 Three Japanese shipping companies announced the integration plan of their container shipping business, which would be operated by the new brand Ocean Network Express. COSCO SHIPPING Holdings and SIPG jointly made a pre-conditional voluntary general cash offer to all shareholders of OOIL at HK$78.67 per share COSCO and China Shipping announced the consolidation of liner business which started since March 2016, and finished at the end of Hanjin Shipping declared bankruptcy reorganization procedure and was officially declared bankrupt on February 17, Maersk announced an acquisition intention of Hamburg Süd. After an agreement signed on March 14, 2017, the due diligence and closing of transaction expected to be finalised in the fourth quarter of

28 OOIL s advantages IT system OOIL s IT system has been one of its long-term competitive advantages. The current IT system of COSCO SHIPPING Lines, shares the same origin with the IRIS4 system that OOIL is using. The high level of compatibility will help the two companies better integrate their IT systems in order to facilitate faster transition to global IT service standards. Profitability OOIL is one of the most competitive players in the container shipping market with outstanding asset quality and industry leading profitability over the years. Reputation OOIL has a long history and has developed into an influential shipping industry in the world. It is also one of the trademark enterprises in Hong Kong. Governance As a global shipping company with decades of history, it has undergone many profound changes in the industry, and the management has extensive industry experience and corporate governance experience. OOIL locates in Hong Kong and has nurtured an experienced international staff team. 27

29 Market Outlook 28

30 see positive signs but still face uncertainties 20.0% 15.0% 13.8% 13.2% 14.2% 10.0% 5.0% 0.0% 12.4% 5.8% 5.5% 9.1% 7.9% 8.3% 4.7% 6.0% 5.9% 6.3% 3.7% 5.1% 1.5% 8.6% 2.5% 1.7% 6.1% 4.3% 5.3% 4.7% -5.0% -8.2% -10.0% E 2018E 运力增长 (%) 13.8% 13.2% 5.5% 9.1% 7.9% 6.0% 5.9% 6.3% 8.6% 1.7% 4.3% 5.3% Capacity growth(%) 吞吐量增长 (%) 12.4% 5.8% -8.2% 14.2% 8.3% 4.7% 3.7% 5.1% 1.5% 2.5% 6.1% 4.7% Throughput growth(%) Fleet Projections ( 000 TEU) E 2018E 2019E Newbuild deliveries 938 1,314 1, Scrapped Capacity at year-end 20,311 21,178 22,308 22,337 Growth rate, net 1.7% 4.3% 5.3% 0.1% 68% 78% 85% 19% 5% 1% 13% 17% 14% 79% >10,000TEU 5,100-9,999TEU <5,100TEU 21% Source: Alphaliner, August E 2018E 2019E 29

31 container shipping segment development strategies 1 Optimize the shipping routes and network allocation, to implement the globalization strategy Globalization To establish a globalized network layout and an alliance operation system that adapt with the shipping capacity so as to achieve the OCEAN Alliance s service advantages in east-west trunk routes and provide new momentum for global trading. To capture strategy opportunities, such as the One Belt One Road and Yangtze River Economic Belt to improve performance in emerging market and third-country routes. 2 Enhance service capabilities and improve customer experience Customeroriented To insist on being customer-centric, demand-oriented, reliant on global resources in providing customers with customized services in order to meet their diversified demands To strengthen the construction of marketing team, improve customer experience. 3 Low Cost Accelerate to realize synergies To strengthen cost control and explore in depth the potential synergy of the optimization of shipping route network layout, container management, and supplier procurement. 4 One-stop transportatio n capability Further improve the capability to provide one-stop solutions to customers To strengthen the capabilities in one-stop transportation solutions and the seamless articulation with highways and railways so as to further enrich and improve the service model and provide customers with more choices and convenience To create more intermodal transportation products, strengthen the status of Piraeus as hub port. 30

32 terminal business development strategies 1 Actively seeking terminal assets on a global basis that offer good intrinsic value and long-term returns, so as to develop a comprehensive, well-balanced global terminals network Globalization We prioritize control, the capability of generating higher shareholder returns, as well as the value brought to our terminal network at large Target locations: Europe, Central and Southern America, SE Asia, Africa 2 Synergies Fully exploiting the dominance arising from COSCO SHIPPING Lines and seizing significant market share within the OCEAN Alliance Enhanced bargaining power in bidding for terminal projects 3 Increase the proportion of terminals with controlling stakes Control Carry out equity investments in port groups strategically Adopt a standardised management and information system for all terminals with controlling stakes 31

33 To become a top-tier container shipping and port service provider Disclaimer This presentation contains certain forward-looking statements with respect to the financial condition, results of operations and business of COSCO SHIPPING Holdings and certain plans and prospects of the management of COSCO SHIPPING Holdings. Thanks! Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual result or performance of COSCO SHIPPING Holdings to be materially different from any future results or performance expressed or implied by such forward looking statements. Such forward- looking statements are based on numerous assumptions regarding COSCO SHIPPING Holdings present and future business strategies and the political and economic environment in which COSCO SHIPPING Holdings will operate in the future. The representations, analysis and advice made by COSCO SHIPPING Holdings in this presentation shall not be construed as recommendations for buying or selling shares of COSCO SHIPPING Holdings. COSCO SHIPPING Holdings shall not be responsible for any action or non-action made according to the contents of this presentation. 32