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Public company info - CSSC (Hong Kong) Shipping Company Limited , 03877.HK
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CSSC (Hong Kong) Shipping Company Limited, 03877.HK - Company Profile
Chairman Zhong Jian
Share Issued (share) 6,136,000,000
Par Currency
Par Value 0.0
Industry Other Financials
Corporate Profile Business Summary: The group is principally engaged in provision of leasing business, ship brokerage services and financing business acts. Performance for the year: For the year ended 31 December 2019, the Group’s business maintained a rapid growth and achieved a revenue of HK$2,294.4 million, representing a year-on-year increase of 9.0%. The Group’s profit from operations was HK$847.6 million, representing an increase of 45.5% as compared to 2018. The growth in profit from operations reflected the strong development of the Group’s leasing business. The Group recorded a profit of HK$892.4 million for the year ended 31 December 2019, representing a year-on-year increase of 26.3%. Business Review Rapid development of leasing business and rapid growth in results of operations The Company focused on the provision of ship leasing services, continuously pushed forward its innovative business model, strengthened cooperative relationships with customers, financiers, shipbuilding companies and other business partners, proactively developed incremental projects as well as optimized its management of existing projects, which led to the stable and rapid development of the Company’s results in 2019. For the year ended 31 December 2019, the Group’s business maintained a rapid growth and achieved a revenue of HK$2,294.4 million, representing a year-on-year increase of 9.0%. The Group’s profit from operations was HK$847.6 million, representing an increase of 45.5% as compared to 2018. The growth in profit from operations reflected the strong development of the Group’s leasing business. The Group recorded a profit of HK$892.4 million for the year ended 31 December 2019, representing a year-on-year increase of 26.3%. As at 31 December 2019, the Group’s return on average net assets and return on average assets was 12.5% and 3.1%, respectively. In 2019, the Group commenced 29 leasing contracts, completed 13 leasing contracts and had 81 on-going leasing contracts, of which 41 were operating lease contracts and 40 were finance lease contracts. Among those 81 on-going leasing contracts, 64 were leasing contracts with a term of more than one year, which were of an average outstanding lease term of approximately 7.7 years and with a contract value of HK$33.6 billion. As at 31 December 2019, the Group’s vessel portfolio reached 117, of which 81 were operating and 36 were under construction. The average age of the Group’s vessel portfolio was 2.4 years. Furthermore, in 2019, the Company was assigned corporate credit ratings of A- and A by S&P Global Ratings and Fitch Ratings, respectively, which facilitated the Company’s use of diversified financing methods in order to optimize debt structure and reduce financing costs. The Company’s comprehensive interest rate in respect of its interestbearing liabilities was 4.1% in 2019 compared to 4.4% in 2018. Adoption of counter-cyclical investment strategy and increase in investment in high-quality vessels In 2019, the Company fully assumed the professional advantages of a shipyard-affiliated leasing company. In particular, the Group kept up with the market demand, adopted a counter-cyclical investment strategy, increased investment in clean energy equipment and high-quality vessels of various market segments such as gas carriers, dual-fuel tankers, multi-purpose heavy lift carriers and class bulk carriers, and continued to optimize its assets allocation. The marine industry had the characteristics of highly cyclical fluctuations. The Company relied on the extensive industry experience of its management team and the advantages of its comprehensive and mature business network, and leveraged the unique advantages of shipyard-affiliated leasing companies to purchase high-quality assets at a relatively low market price, which significantly mitigated the risk of asset value fluctuations, while operating assets would also benefit from the value profit arising from market rebound. Improvement in risk management capabilities and maintenance of high-level asset quality The Company attached great importance to its sound risk management system and enhanced its ability to deal with and resolve high risk and undesirable projects. The Company has established a 24-hour monitoring information system for its vessel assets which tracks the position of vessels, their routes and operating status in real time, understands abnormal events of assets, evaluates asset value on a regular basis and dynamically tracks projects, provides early warning of project risks. It strives to improve the Company’s risk management and control capability and maintain high-level asset quality. As at 31 December 2019, the Company’s assets were in good operating condition, the utilization rate of vessel assets was 100%, and the overall recovery rate of charter hire was 99%. Prospects: In early 2020, the world economy experienced massive hit due to COVID-19 outbreak and the great plunge in crude oil prices, which caused severe fluctuations in the global market and brought unprecedented challenges to the global economy and marine industry. The US and Europe have taken measures such as reducing interest rates to stimulate the economy. Moreover, the economic stimulus policy may offset the negative effects to a certain extent and present new opportunities to the marine industry. As the ship leasing industry has the advantages of high flexibility, when the maritime industry faces challenges, the Group is expected to be in a favorable position to exert its professional advantages. Providing flexible and competitive leasing solutions to vessel operators also allows the Group to have better access to low-cost and high-quality assets. Meanwhile, as the global base interest rate is in decline, the Company’s cost of debt is expected to further decrease. The Group’s unique industrial background makes it easier for it to grasp cyclical opportunities in the marine industry. Leveraging its strong expertise in the marine industry and good synergy with ship design houses and shipyards, the Group will capitalize on the market development trend, focus on its maritime business and marine economy to optimize its asset portfolios, strictly control risk exposures and operate prudently, and continue to push forward reform measures, such as equity incentives, to motive entrepreneurial vitality of the team and achieve high-quality development of the Company. The Company will fully leverage its first-mover advantage as a leading shipyardaffiliated leasing company, implement sustainable development based on its market-oriented and professional development direction, and strive to create greater value for its Shareholders and society.

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