(28th August 2017, Hong Kong) The board of directors (“the Board”) of COSCO SHIPPING International (Hong Kong) Limited (“COSCO SHIPPING International” or the “Company”, stock code: 00517.HK) today announced the unaudited consolidated results of the Company and its subsidiaries (collectively the “Group”) for the six months ended 30th June 2017.

In the first half of 2017, the global economy saw an upward trend in growth with improving market confidence. The solid economic and trade growth brought about long-awaited signs of recovery for the shipping industry. The rational competition and cooperation in the shipping industry further facilitated the positive growth momentum in the shipping market. However, the shipping industry will remain subdued by excess shipping capacity for a prolonged period of time.

During the period, COSCO SHIPPING International actively coped with market changes, increased income and reduced expenditure, continued to strengthen and optimise the existing businesses, and pushed forward the Company’s projects, and speeded up the establishment of “shipping services industrial cluster”. In terms of business expansion, the Company completed the acquisition of CSHT Marine Machinery Suppliers Limited in early January 2017. The acquisition, on the one hand, expanded the size of the existing relevant business, and, on the other hand, facilitated synergy creation through economies of scale and cost reduction, thus generating more profits for the Group.

During the period, profit attributable to equity holders of the Company was HK$206 million, increased by 42% as compared to same period of 2016. The increase was attributable to a considerable amount of exchange gain of the US dollar deposits of the Group resulted from the appreciation of the exchange rate of US dollar against Hong Kong dollar during the period; and the finance income from the Company’s short-term bank deposits increased by 33% year-on-year. In addition, benefiting from the recovery of shipping market, the number of new-build delivery and second -hand vessels was significantly increased. The core business shipping service maintained a steady growth and its profit before income tax increased by 17% year-on-year.

Basic earnings per share was 13.41 HK cents. The Board declared an interim dividend of 6 HK cents (2016: 4 HK cents) per share. As at the end of 30th June 2017, COSCO SHIPPING International had net cash of HK$6.42 billion, or HK$4.19 per share, which will provide strong capital support for major acquisitions and expansion of existing businesses in future.
Looking ahead, the global economy will continue its recovery momentum. According to the forecast by OECD, the global economy in 2017 will see the fastest growth over the past six years. At the same time, there are numerous favourable factors in the shipping industry: Firstly, upon the bankruptcy of several well-known shipping companies, industry peers recognised the importance of rational competition. Shipping companies are more concerned about the sustainable development of the industry; Secondly, the “Belt and Road” initiative and the regional economic development are expected to become the new momentum and a source of growth of global trade; Thirdly, the further implementation of policies of state-owned enterprise reform and state-owned capital reform in China will be favourable to the industry. We are expecting the shipping industry will show the upward trend in the next few years. However, the factors of the intensifying trade protectionism, the increasing geopolitics risks, and the highlighted structural issues, etc., will remain the grey rhinos to the shipping industry which cannot be neglected.

COSCO SHIPPING International will make use of the strategic opportunities presented by the national “Belt and Road” initiative and actively participate in the building of Guangdong-Hong Kong-Macao Bay Area. It will fully utilise its funds platform as a listed company through developing a non-financial equity investment platform. With the increasing concern about environmentally protection issues in the shipping industry around the world, the Group will seek relevant investment opportunities. It will also improve its information system. Through the application of big data, the Group can understand, predict and fulfil the demands of vessel fleet in a better way, thus offering tailor-made and seamless services for them and expanding the profitability of the Company. The vision of COSCO SHIPPING International is to establish itself as a world class and leading shipping services company in China.