News

With positive profits, shipping enterprises increase investment in their fleets

Summary

The recovering demand for freight transport and the continuously increasing freight rates have helped shipping enterprises achieve impressive profits in the first half of this year. This also creates an impetus for them to step up investment and improve the capacity of their fleet.

Updated on : 20-09-2021

Continuously gain big profits

The second quarter financial report of Hai An Transport and Stevedoring JSC recorded a 49% increase in revenue and 2.6 times higher profit, reaching VND808 billion and VND183 billion, respectively. In which, the fleet operation contributed 62% to Hai An's business results.

At Vietnam Maritime Corporation (VIMC), revenue in the first six months of 2021 recorded an increase of 22%, reaching VND6,040 billion; and net profit increased 26.8 times, reaching VND686 billion. Notably, of VIMC’s business segments, the transportation service achieved high growth with transportation service revenue of VND1,629 billion, up 63%; gross profit was VND254 billion while in the same period last year, gross loss was VND89 billion.

After years of sluggish business, Vinaship's financial statements for the second quarter of 2021 suddenly recorded an increase of 124% in revenue, reaching VND240 billion; profit after tax also increased sharply by 270%, reaching VND66 billion.

In six months, Vinaship achieved VND387 billion in revenue, up 58% and net profit was VND69 billion, 30 times higher than the same period last year. This result helped Vinaship's accumulated loss drop sharply from VND218 billion at the beginning of the year to VND149 billion.

At Vietnam Ocean Shipping JSC (Vosco), the stable and efficient operation of the fleet along with income and interest from asset liquidation have helped the company make a profit of VND242 billion in the second quarter of 2021, while in the same period last year the loss was VND32 billion.

Accumulated in the first six months, Vosco had a profit after tax of VND220 billion compared to a loss of nearly VND120 billion in the same period last year. This is also the highest semi-annual profit since 2009.

Upgrading the fleet

High freight rates have stimulated businesses to upgrade their fleets to more effectively exploit this business segment. Additionally, improved business results consolidate more resources for businesses to invest.

Hai An has invested in two new ships, Haian East and Haian West, to improve the fleet's output.

This enterprise now owns eight ships with a total capacity of up to 11,000 TEUs. Recently, Hai An Board of Directors has approved a plan to build a new container ship with a capacity of 1,800 TEU in China.

Vosco has also actively sought out and chartered outsourced vessels to increase the company's shipping capacity, throughput, revenue, and efficiency.

At Gemadept JSC, besides the shipping segment with four modern ships, in October 2020, Gemadept port in Hai Phong launched the service of transporting empty containers from Lach Huyen to Gemadept's ports Hai Phong city.

According to Gemadept JSC, the deployed barge route contributes to rationalizing the costs of transporting empty containers, bringing convenience for shipping lines as well as diversifying modes of transport, reducing pressure on road traffic, towards green, balanced, and sustainable development of Vietnam's maritime industry.

Last April, Gemadept put into operation the Phuoc Long 60 barge with a capacity of 248 TEUs. Adding the number of high-capacity barges to Gemadept's fleet has increased its transportation capacity, saved fuel, freight time, and costs, and satisfied customers' needs.

In addition to well-known enterprises in the field of shipping, in February 2021, Hoa Phat Shipping JSC – a member of Hoa Phat Group – also completed the purchase and receipt of two large cargo ships with tonnage of 90,000 tons. They will be used to transport coal and iron ore for Hoa Phat Group. Due to the large number of goods, this business needs to import tens of millions of tons of raw materials, including iron ore, coal, limestone, and scrap to serve production every year.

Owning a ship will create great advantages for this enterprise and optimize transportation costs, reducing the risk of freight charges in case of high prices.

Along with chartering for all FOB and CFR orders of Hoa Phat Group, Hoa Phat Shipping JSC will accept commercial orders. In the future, Hoa Phat also plans to buy more ships to serve Dung Quat 2 Project, when the need to import machinery, equipment and production materials will increase 2-3 times compared to present.