COSCO SHIPPING Holdings Posted Remarkable Results Laying A Solid Foundation for Transformation

(30 March 2023, Shanghai)–COSCO SHIPPING Holdings Co., Ltd. announced its 2022 annual results.
 
·In 2022, COSCO SHIPPING Holdings overcame various difficulties and posted remarkable financial results. The Company’s earnings before interest and tax (EBIT) for 2022 increased by 29.77% to RMB170.78 billion; Total profit before tax for 2022 increased by 30.54% to RMB167.1 billion. Net profit for 2022 increased by 26.4% to RMB131.34 billion.

·COSCO SHIPPING Holdings expedited the development of digital supply chain as well as green and low-carbon transformation; strengthened its capital operation; supplemented and expanded its own supply chain, thereby further enhancing its operational quality and resilience to counter economic downturn.

·As at the end of 31 December 2022, the Company’s asset-liability ratio was 50.46%, down 6.22 percentage points from the beginning of the period and laying a stronger foundation for the Company’s high-quality development.

·The board of directors proposed a final dividend of RMB 1.39 per share (tax inclusive) for the year 2022. Taken into account of a distributed interim dividend of RMB 2.01 per share (tax inclusive), approximately about 50% of the profit attributable to equity holders of the Company.
 
In the face of volatile external environment in 2022, COSCO SHIPPING Holdings adhered to the “customer centric” approach with the mission of creating a “global digital supply chain operation and investment platform with core on container shipping”. It made relentlessly efforts to provide customers with the supply chain solutions integrating “container shipping+ports+related logistics” services. Significant progress was made in its global development, supply chain construction, digital empowerment, and green and low-carbon transformation. As the Company overcame various challenges, it posted remarkable financial results during the year.
 
New progress of globalisation

In 2022, COSCO SHIPPING Holdings and other members of the Ocean Alliance presented the DAY6 and DAY7 Product, reinforcing the cooperation mechanism between each other and giving full play to their shipping resources. As the Company’s strengths in east-west services were strengthened, it also pushed for the expansion in overseas regional markets, emerging markets and third-country markets, delivering the most frequent, widest coverage and best shipping services in the market. While the “normalization” of container shipping industry gained momentum, it implemented the precision business strategy to ensure the delivery of services to customers with long-term contracts, effectively secure the efficiency of its shipping services and drive its global development.
 
Speed-up of supply chain upgrade

In 2022, COSCO SHIPPING Holdings accelerated the business transformation and upgrading, offering customers an easy access to its supply chain. The rail-sea cargo volume of the Western China Land-Sea Trade Corridor increased by 29% year-on-year, and the volume of loading and discharging at Yangpu Port in Hainan Province increased by 38% year-on-year. New breakthroughs were made in the China-Europe Sea-Rail Express, forming a sea-rail inter-model transportation ring linking 10 countries in Central and Eastern Europe. The layouts of warehouses overseas in certain areas and countries were persistently improved, including Piraeus, Abu Dhabi, Panama, Colombia and etc. The supply chain logistics trailer platform was put into operation, and the service model for vehicle export transportation was innovated, accelerating the construction of full link service capacity.
 
Digital Intelligence Empowerment Iterative Advanced

In 2022, COSCO SHIPPING Holdings actively led the innovation and transformation of shipping digitization, creating a more efficient container supply chain service system for global customers. The core product “Cargo Release” of Global Shipping Business Network (GSBN) landed in Europe, and the blockchain electronic bill of lading was officially released, promoting the efficient operation of global trade. “Syncon Hub”, an e-commerce platform for foreign trade, has new value growth points by launching several digital supply chain products. The launch of the marine Internet of Things system has set a new benchmark for professional solutions for intelligent reefer logistics throughout the process. The "Full-process Automation Upgrading Project" of Tianjin TCT terminal commenced full operation, demonstrating that the Company's port automation level and operational efficiency reached new highs.
 
Capital operation integrating upstream and downstream

In 2022, COSCO SHIPPING Holdings launched a series of capital operation projects in relation to its main businesses, which not only improved its own operation and revenue quality, but also provided a capital driver for accelerating its business transformation and upgrading. Through capital operations, including its investment in COSCO SHIPPING Logistics, the introduction of SAIC as a strategic investor of the Company, the additional investments in SIPG Group, Guangzhou Port and COSCO SHIPPING Ports, the Company utilized capital operations to increase the synergies between ports, shipping services and logistics, driving the deep integration of modern service industry and advanced manufacturing industry.
 
Embracing green and low-carbon development

In 2022, COSCO SHIPPING Holdings further accelerated the transformation towards green and low-carbon development in accordance with market trends and long-term potential needs of customers. The Group ordered twelve 24,000-TEU methanol dual-fuel container vessels, explored the pilot usage of biofuels on operating vessels, adopted the use of the Energy Efficiency Existing Ship Index (EEXI) and the rating rules of the Carbon Intensity Indicators (CII). Moreover, it vigorously promoted the use of onshore power at container berths, introduced distributed photovoltaic power generation projects at the terminals in Wuhan, the design of green low-carbon full chain service products, and paving the way for new green supply chain transportation. All of these efforts facilitate the further implementation of sustainable development concept.

Looking forward to 2023, the container shipping industry will not only face long-term issues such as a slowdown in demand growth, the evolving trade patterns and the accelerating process of decarbonization, but also encounter practical challenges arising from intensified market competition and increased supply of shipping capacity. On the other hand, China’s proactive measures to drive economic recovery and further deepen reform and opening-up policy will power the world’s economic recovery.

In view of these factors, the Company will adhere to its customer-centric approach and step up efforts to address customers' increasingly diversified, network-based, digitalized and low-carbon service needs, with primary focus will be placed on the following areas:

Firstly, the Company will improve global deployment, continuously expand in emerging markets, regional markets, and the third-country markets, and contributing our efforts to establish a new development pattern of domestic and overseas “dual-cycles”, help customers quickly obtain more product information, realize reliable flow of goods and reinforce connection with customers in the process of mutual trust and cooperation.

Secondly, the Company will drive the development of digital intelligence and accelerate the docking with customer systems, give play to its own investment platform function, promote investment, construction, and operation in one, accelerate the implementation of digital supply chain construction, and provide customers with more intelligent and visual full-chain service products and solutions.

Thirdly, the Company will implement cost control and strengthen the integrated operation of the middle and back offices of dual brands, continuously improve operational efficiency, and enhance the competitiveness of the main industry.

Fourthly，the Company will accelerate the green transformation to prepare a route reserve for the overall fleet to achieve a steady low-carbon green transformation. Also, the Company will optimize the allocation of transportation capacity, and promote the technological transformation of vessels to contribute to the sustainable and healthy development of the industry.

Looking ahead, COSCO SHIPPING Holdings will actively respond to changes in the global economy and trade, and accelerate the transformation and upgrading of the main businesses, strive to provide low-carbon, intelligent, and reliable container logistics supply chain solutions for thousands of industries, build an efficient, smooth, and safe circulation system for global trade, provide better services to customers, and create greater value for shareholders. 

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