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Public company info - COSCO SHIPPING Development Co. Ltd.- H Shares , 02866.HK
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COSCO SHIPPING Development Co. Ltd.- H Shares, 02866.HK - Company Profile
Chairman Wang Daxiong
Share Issued (share) 3,676,000,000
Par Currency Renminbi
Par Value 1.0
Industry Marine & Harbour Services
Corporate Profile Business Summary: During the year, the principal activities of the Group were as follows:(a) Operating leasing and financial leasing;(b) Manufacture and sale of containers;(c) Provision of financial and insurance brokerage services;(d) Equity investment. Performance for the year: The Group recorded operating revenue of RMB14,155,859,000 for 2019, representing a decrease of 13% as compared with RMB16,242,002,000 of last year; total profit before income tax from continuing operations amounted to RMB1,944,482,000, representing an increase of 13% as compared with RMB1,715,605,000 of last year; profit attributable to owners of the parent of the Company for the year amounted to RMB1,744,733,000, representing an increase of 26% as compared with RMB1,384,257,000 of last year. Business Review In 2019, with the strategic objective to build an integrated supply chain financial service platform featuring shipping logistics and through ongoing exploration and innovation, the Company initially built up a one-stop shipping financial service platform with the theme of “combining industry with finance and boosting industry development with finance”, a market-oriented, diversified, professional team, and a corporate culture of pursuing excellence and seeking practical results. Focusing on its principal shipping business, the Company explored market opportunities and expanded the growth potential of various segments in an effort to grow stronger and better. I. The Leasing Segments Achieved Steady Growth Through Inward and Outward Efforts 1. Vessel Leasing Business Deepened Internal Coordination and Developed External Leasing Business Focusing on the strategic requirements of industry-finance integration, the Company strengthened internal coordination and flexibly designed various business models such as operating lease, second-hand vessel financing and long-term leaseback to provide highquality leasing services for upstream and downstream players in the shipping industry chain. The Company opportunistically made a breakthrough in the cruise leasing business, helping China’s cruise industry to sail to the world. In addition, the Company vigorously developed external leasing business (covering various vessels such as chemical vessels, refined oil tankers and bulk carriers) and expanded the coverage of customers and business, in a drive to continuously enhance its competitiveness and brand influence in the industry. As at 31 December 2019, the Company had a fleet of 87 container vessels with a total capacity of 609,400 TEU, 4 bulk carriers of 64,000 DWT each, a total of over 80 LNG vessels, heavy lift vessels, oil tankers and other vessels, and over 30 projects regarding terminals, terminal equipment and major transportation. 2. Container Leasing Business Reinforced Industry Chain Synergy and Made Multiple Breakthroughs In an overall challenging industry environment, the Company made strategic adjustments in a timely manner and better leveraged its synergistic advantages to seek breakthroughs in the container leasing business and related innovative business lines. Specifically, the Company advanced the big customer strategy, built an extensive regional customer base, and captured the market demand for reefer containers and special containers to promote the development of non-dry container business. Meanwhile, the Company developed new container trading business, scaled up mobile warehousing and leasing projects, and explored finance lease business, thus improving the overall return on investment. As at 31 December 2019, the container fleet of Florens International Limited (“FIL”), an affiliate of the Company, boasted a total capacity of about 3.66 million TEU, ranking second in the world. 3. Other Leasing Businesses Explored New Business Areas While Developing Steadily In the face of the increasingly fierce competition in the industry, the Company explored new business areas to seek new profit growth drivers while consolidating its existing development advantages; accelerated the disposal of existing risk projects and improved asset disposal and operation capabilities; launched asset-backed schemes to expand financing channels and constantly optimized the financing structure to reduce financing costs. II. Container Manufacturing Segment Achieved Economies of Scale and Enhanced Research and Innovation Capabilities In 2019, given the weak demand for containers, the Company faced up to the market challenges and actively sought business breakthroughs, optimized service quality, and innovated in service models to further enhance the synergy of shipping business. Meanwhile, the elite assets of Singamas Container Holdings Limited acquired by COSCO SHIPPING had been entrusted to Shanghai Universal Logistics Equipment Co., Ltd., a subsidiary of the Company, for management, pushing up the market share of the Group’s container manufacturing segment to rank second in the world. The acquisition also made up for certain weaknesses of the Group, such as insufficient production capacity, lack of presence in key regions, and lack of reefer containers. In addition, the Group continuously improved its research and innovation capabilities and concentrated on upgrading technical management, with a view to enhancing the core competitiveness of its container manufacturing segment. III. Investment and Services Segment Deepened Industryfinance I ntegration to Facilitate the Development of the Shipping Business and New Business Lines With a focus on the shipping industry chain, the Company constantly optimized its investment portfolio and successfully implemented sizeable financial and other equity investment projects, buffering the fluctuations in the shipping market. The Company further promoted the launch of “Yuan Hai” (遠海) series of industry funds and searched high-quality industryfinance integration projects to build up a characteristic industry brand, and achieved breakthroughs in multiple projects. In addition, the Company expanded the scope of supply chain financial services, enhanced service capacity and leveraged the strengths of its service portfolio to increase customer stickiness in different industries. IV. Improving the Return on Investment and Safeguarding the Interests of Investors On 14 May 2019, the Company completed its share buybacks in the A-share and H-share markets by repurchasing a total of approximately 155 million A and H shares, representing approximately 1.32% of its total share capital. By doing so, the Company became the first listed company in the capital market to successfully implement share buybacks in two stock exchanges, winning wide recognition in the capital market and increasing the Company’s market influence. The move also enhanced investors’ investment confidence, safeguarded the interests of investors, and promoted the Company’s long-term sustainable development. In the second half of the year, the Company completed the dividend distribution to A-share and H-share investors, distributing a total cash dividend of approximately RMB380 million to all shareholders. The generous dividend distribution heaped praise from investors. V. Carrying Out Comprehensive Risk Management and Improving Internal Control Capabilities In 2019, on the basis of building a favorable environment and developing measures for risk management, the Company systematically performed risk monitoring and dynamically reinforced risk limit management. Based on the requirements of its risk management system, the Company intensified the measures for the management of liquidity risk, credit risk and operational risk, improved liquidity risk monitoring, and promoted the integration of risk management into production and operation through risk limits, risk assessment, risk reporting, etc. The Company also strengthened the construction of risk management information system, improved the professionalism in risk management, and carried out comprehensive risk management to ensure that no major risk events occurred throughout the year. VI. Promoting the “Excellence” Corporate Culture and Honoring Social Responsibility The Company upholds the philosophy of sustainable development and actively fulfills its social responsibility. The Company constantly strengthened environment management to minimize its environment impact, adopted various measures to pursue sustainable development, and worked with China Development Bank to promote tourism poverty alleviation and practice financial poverty alleviation in an effort to contribute to poverty alleviation. Meanwhile, the Company centered on the corporate mission of “boosting industry development with finance and creating value through development” to greatly promote the “excellence” corporate culture, thus providing strong cultural power and value support for the development and management of the Company. This can gather strength to drive the Company to grow faster and better. Prospects: In 2020, as the world’s two largest economies reached the Phase 1 trade agreement, it is widely expected that the downward pressure on the global economy will be relieved to a certain extent. However, the intensifying international geopolitical turmoil, rising oil price volatility, and the global spread of the COVID-19 outbreak have brought great uncertainties to the global economic development. In particular, the recent huge volatility in global financial markets, especially the stock markets of major world economies, has pushed up the external pressure to an extraordinarily high level. Furthermore, the overall over-supply in the shipping market will persist in 2020. As such, the Company will face certain challenges in 2020. The Company will strengthen macro analysis and market research, promote reform and transformation, develop new competitive strengths focusing on industry-finance integration, continuously improve high-quality development, and seek breakthroughs in distinctive shipping financial services. In terms of shipping and industry-related leasing segments, the Company will continue to strengthen the combination of industry and finance, reinforce the collaboration among internal industry chains, and steadily expand external business. In terms of business model, the Company will step up efforts to develop leasing business for special containers and reefer containers, and study and explore smart container leasing, in a bid to build a shipping leasing company with unique competitive strengths. Meanwhile, the Company will uphold the strategy of organic, sustainable, high-quality development to promote the development of other industry-related leasing business, expand financing channels, and develop value-added leasing services, in an effort to become a leader in the leasing industry. In terms of container manufacturing segment, the Company will steadily advance the multi-dimensional integration of its entrusted container manufacturing assets into the Company’s existing business, and enhance its overall competitiveness through technological upgrading, management improvement, process promotion and cultural integration; strengthen communication with industry peers to maintain a healthy business environment of the industry; enhance customer service awareness and seize opportunities to develop the market, so as to enable the industrial chain to grow stronger and better; reinforce the concept of green environmental protection, deepen fine management, continuously improve research and innovation capabilities, in an effort to build a worldclass container manufacturing company. In terms of investment and services segment, the Company will focus on upstream and downstream customers in the industrial chain, constantly optimize its investment portfolio, and seek a balance between strategic value and financial returns; gather external capital, talents and technology through industry funds and other models to boost the development of shipping business and new business lines; improve professional service capabilities and vigorously explore the market to build up a shipping insurance expert platform; combine industry with finance and provide one-stop supply chain financial services covering logistics, financing and risk management, in a great effort to build a supply chain financial ecosystem featuring shipping logistics. The year 2020 is a new beginning. In this era where challenges and opportunities coexist, COSCO SHIPPING Development will adhere to its original objective of developing shipping finance, and ride on the deepening reform of state-owned enterprises to set sail towards high-quality development, so as to achieve its corporate vision of “building an excellent industry financial services provider”.

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