Core Viewpoint - The company is strategically positioned in the shipping industry, benefiting from both cyclical and stable revenue streams, with a focus on enhancing profitability through various business segments and maintaining high cash reserves for financial stability [1][2][3]. Group 1: Business Segments - The company operates in the shipping service industry, including paint production, ship trading agency, insurance consulting, and supply of ship equipment and parts [1]. - The paint business is expected to see continuous profit growth due to increased shipbuilding volumes and reduced raw material costs from lower oil prices [1]. - The insurance and agency businesses provide stable earnings, benefiting from the shipbuilding renewal cycle and increased global shipping rates [1]. - The ship equipment and parts business has shown consistent growth in scale and stable profit margins due to rising ship delivery volumes [1]. Group 2: Financial Performance - The company maintains a cash reserve of approximately HKD 6 billion, with financial income primarily from bank deposit interest, which has increased from HKD 0.05 billion in 2021 to HKD 0.27 billion in 2024, accounting for 38% of annual net profit [2]. - The company has a high dividend payout ratio, maintaining around 100% from 2020 to 2024, indicating strong cash flow and commitment to shareholder returns, with a projected dividend yield of about 9% in 2025 [2]. Group 3: Strategic Initiatives - The company is proactively investing in green methanol to capture opportunities in the shipping industry's transition to alternative fuels, with a joint venture established to focus on biomass-coupled green methanol production, expected to start production in 2026 with a capacity of 200,000 tons per year [2]. - The company is rated "Buy" with projected net profits of HKD 740 million, HKD 760 million, and HKD 800 million for 2025-2027, corresponding to PE ratios of 11, 11, and 10 times, respectively [3]. - The absolute valuation using FCFF suggests a reasonable market value of HKD 10.7 billion, indicating a potential upside of 29% [3].

上 市 公 司 交通运输 2025 年 07 月 10 日 中远海运国际 (00517) —— 主业受益船舶更新周期，高派息率构筑护城河 报告原因：首次覆盖 买入（首次评级） | 市场数据： | 2025 年 07 月 09 日 | | --- | --- | | 收盘价（港币） | 5.64 | | 恒生中国企业指数 | 8597.27 | | 52 周最高/最低（港币） | 5.73/3.45 | | H 股市值（亿港币） | 82.68 | | 流通 H 股（百万股） | 1,465.97 | | 汇率（人民币/港币） | 1.0973 | 一年内股价与基准指数对比走势： -8% 92% 07/09 08/09 09/09 10/09 11/09 12/09 01/09 02/09 03/09 04/09 05/09 06/09 07/09 HSCEI 中远海运国际 资料来源：Bloomberg 相关研究 证券分析师 闫海 A0230519010004 yanhai@swsresearch.com 联系人 王晨鉴 (8621)23297818× wangcj@swsresearch.com 财务数据及盈 ...

Core Viewpoint - The launch of the "Yuanhai Kou" vessel marks a significant advancement in China's automotive shipping capabilities, particularly for electric vehicles, enhancing the efficiency of transportation to countries involved in the Belt and Road Initiative [1][2]. Group 1: Vessel Specifications and Features - The "Yuanhai Kou" vessel is the largest dual-fuel automotive transport ship in China, with a total length of 199.9 meters and a gross tonnage of 68,252 tons [2]. - It has a carrying capacity of 7,000 standard car spaces, accommodating various vehicle types including passenger cars, engineering vehicles, and buses [2]. - The vessel is equipped with an advanced LNG dual-fuel main engine, achieving a carbon reduction rate of over 24% upon operation [2]. - It features a distributed solar photovoltaic system with a peak power of 302.8 kilowatts, which is the largest installed on similar vessels [2]. - The design includes a container for growing fresh vegetables, creating a self-sufficient "green garden" on board [2]. Group 2: Operational Impact and Market Reach - The "Yuanhai Kou" vessel's inaugural route significantly reduces transportation time by nearly one-third compared to standard routes, benefiting automotive companies [1]. - The vessel operates on the "China-Mediterranean" liner route, utilizing Piraeus Port as a hub, which allows coverage of multiple European countries, major North African nations, and Black Sea region ports [1]. - It carries approximately 4,000 vehicles from Chinese brands, with over 90% being new energy vehicles, destined for countries such as Greece, Turkey, Italy, and Tunisia [1].

Core Viewpoint - COSCO Shipping International (00517) reported a revenue of HKD 3.627 billion for the fiscal year 2024, reflecting a year-on-year growth of 8.54%, and a net profit attributable to shareholders of HKD 709 million, which is a 19.46% increase compared to the previous year [3] Financial Performance - The company achieved a net cash flow from operating activities of HKD 67.805 million, a significant decline of 87.04% year-on-year [24] - Basic earnings per share for the year were HKD 0.4838, with a weighted average return on equity of 9.03%, an increase of 1.44 percentage points from the previous year [20] - The proposed dividend for 2024 is HKD 0.215 per share [3] Valuation Metrics - As of April 24, the company's price-to-earnings (P/E) ratio (TTM) is approximately 9.26, the price-to-book (P/B) ratio (TTM) is about 0.83, and the price-to-sales (P/S) ratio (TTM) is around 1.81 [3] Revenue Composition - In 2024, the revenue breakdown includes: - Ship equipment and spare parts: HKD 1.8142 billion - Coatings: HKD 1.394 billion - General trade: HKD 2.219 billion - Insurance consulting: HKD 1.071 billion - Ship trading agency: HKD 0.004 billion - Other businesses: HKD 0.004 billion [16] Cash Flow and Investment Activities - The net cash flow from financing activities was negative HKD 661 million, a decrease of HKD 126 million year-on-year [24] - The net cash flow from investing activities was HKD 3.104 billion, compared to HKD 942 million in the previous year [24] Asset and Liability Changes - As of the end of 2024, cash and cash equivalents decreased by 5.08%, while intangible assets increased by 236.72% [33] - Accounts payable and notes payable increased by 14.44%, while contract liabilities decreased by 4.44% [36] Liquidity Ratios - The current ratio for 2024 is 7.31, and the quick ratio is 6.92, indicating strong liquidity [39]

Financial Performance - Total revenue for 2024 reached HKD 3,627,126,000, a 9% increase from HKD 3,341,729,000 in 2023[26] - Gross profit rose to HKD 845,569,000, reflecting a 27% growth compared to HKD 663,634,000 in the previous year[26] - Operating profit increased by 32% to HKD 192,334,000 from HKD 145,871,000 in 2023[26] - Profit attributable to equity holders was HKD 709,211,000, up 19% from HKD 593,673,000 in 2023[26] - Earnings per share (EPS) grew by 20% to HKD 0.4838 from HKD 0.4033 in the previous year[26] - The shipping services segment saw a revenue increase of 26% to HKD 3,487,682,000, with the coatings segment alone growing by 63% to HKD 1,344,147,000[28] - The company's market capitalization increased by 40% to approximately HKD 6,245,038,000 by the end of 2024, compared to HKD 4,456,553,000 at the end of 2023[32] - The total asset return rate improved to 7.65%, up from 6.44% in 2023, while the return on equity rose to 9.03% from 7.59%[26] - The group's net profit attributable to equity holders increased by 19% to HKD 709,211,000, compared to HKD 593,673,000 in 2023[60] - Total assets increased by 1% to HKD 9,333,570,000, up from HKD 9,205,229,000 in 2023[69] Dividends - The company reported a proposed final dividend of HKD 0.215 per share for 2024, totaling an annual dividend of HKD 0.48 per share[18] - The company proposed a final dividend of HKD 0.215 per share, totaling HKD 0.48 for the year, a 20% increase from HKD 0.40 in 2023[31] Strategic Initiatives - The company aims to provide green low-carbon digital solutions throughout the entire lifecycle of ships, focusing on green energy and digital intelligence[6] - The company is actively investing in establishing a green marine energy platform, targeting the development of a green methanol industry chain[6] - The company plans to continue expanding its market presence and enhancing its service offerings to support the sustainable development of the shipping industry[7] - The company is focusing on integrating digital intelligence technologies to enhance operational efficiency and service offerings in the shipping industry[33] - The company aims to enhance its green energy industry layout and strengthen the application of digital technology innovation to adapt to structural changes in the global shipping industry[39] - The company is focusing on digitalization and green low-carbon transformation, emphasizing the development of a "Green Digital Ship Service Platform" and a "Marine Green Energy Platform"[91] Corporate Governance - The company emphasizes the importance of corporate governance and investor relations in achieving its strategic goals[9] - The company has a strong governance structure with multiple committees including audit, remuneration, and corporate governance[157] - The board of directors has been disclosed in detail, including their qualifications and experience, ensuring transparency[158] - The company emphasizes its commitment to risk management and investor relations as part of its governance strategy[159] - The company is focused on maintaining high standards of corporate governance and compliance with regulatory requirements[160] - The company has adhered to the corporate governance code throughout the fiscal year ending December 31, 2024, with minor deviations noted regarding attendance at the annual general meeting[163] Acquisitions and Investments - The company completed the acquisition of Haining Insurance Brokerage in December 2023, enhancing business scale and profit growth, and is set to acquire Yuan Hua Technical & Supply Corporation by the end of 2024[35] - The company undertook several internal resource integration initiatives, including the acquisition of a 49% stake in Yuan Hua Technical & Supply Corporation, enhancing its service chain[92] Employee and Workforce - Employee benefits expenses totaled HKD 522,270,000, an increase from HKD 446,150,000 in 2023[85] - As of December 31, 2024, male employees account for 69.84% and female employees for 30.16% of the total workforce, reflecting the company's commitment to gender diversity in a male-dominated industry[176] Market Trends - In 2024, the global shipping industry demonstrated resilience with a 2.6% year-on-year increase in maritime trade volume, reaching 1.266 billion tons[89] - The new shipbuilding market experienced explosive growth, with total contract orders reaching 63.07 million compensated gross tons (CGT), a 46.6% increase year-on-year, marking a nearly ten-year industry peak[91] Segment Performance - Revenue from the core shipping services business grew by 26% to HKD 3,487,682,000, accounting for 96% of total group revenue[63] - The segment operating profit for shipping services rose by 24% to HKD 298,878,000, attributed to increased profits from coatings and ship trading agency[65] - The insurance consulting services segment saw revenue rise by 58% to HKD 220,994,000, with profit before tax increasing by 48% to HKD 141,916,000, benefiting from the acquisition of Haining Insurance Broker[104] - The paint production and sales segment reported revenue of HKD 1,344,147,000, with profit before tax of HKD 329,751,000, reflecting significant growth[119] Risk Management - The Risk Management Committee reviewed the risk management assessment report, focusing on identified risks for 2025, including environmental, social, and governance risks[196] - The company has implemented multiple internal control mechanisms to monitor related party transactions[179] ESG Commitment - The company emphasizes its commitment to environmental, social, and governance (ESG) principles, actively participating in charitable activities and receiving recognition for its contributions to society[36] - The company has established an Environmental, Social, and Governance (ESG) Committee to oversee ESG-related functions and responsibilities[198]

Core Insights - The company reported a 19% year-on-year increase in net profit to HKD 709 million, with basic and diluted earnings per share at HKD 0.4838 [3] - The board proposed a final dividend of HKD 0.215 per share, totaling an annual dividend of HKD 0.48 per share, reflecting a payout ratio of approximately 99% [3] - Total revenue for the period was HKD 3.627 billion, a 9% increase year-on-year, with core shipping services revenue rising 26% to HKD 3.488 billion, accounting for 96% of total revenue [3] Financial Performance - The pre-tax profit from core shipping services increased by 25% to HKD 628 million, marking a historical high [3] - The company has committed to enhancing shareholder returns by maintaining a near 100% payout ratio since 2020 [3] Strategic Focus - The company aims to focus on "green intelligent shipping services" and "marine green energy" as part of its strategic direction for 2024 [4] - It plans to leverage digital technology, new energy applications, and low-carbon services to strengthen its core competitiveness and promote synergy among its shipping service divisions [4] Future Outlook - The company intends to develop into a technology-driven shipping service provider, offering comprehensive green and low-carbon digital solutions for the entire lifecycle of vessels [4] - It aims to explore the marine new energy industry, starting with a green methanol production demonstration project, contributing to sustainable development in the shipping industry [4]

Financial Performance - Revenue increased by 9% to HKD 3,627,126,000, driven by higher income from the coatings segment and increased commission income from the insurance consulting segment[5] - Gross profit rose by 27% to HKD 845,569,000, primarily due to improved gross margin in the coatings segment[5] - Core shipping services pre-tax profit increased by 25% to HKD 627,800,000[5] - Profit attributable to equity holders increased by 19% to HKD 709,211,000, mainly due to revenue growth and higher profit from a joint venture[5] - Basic and diluted earnings per share rose by 20% to HKD 0.4838 (2023: HKD 0.4033), with a proposed final dividend of HKD 0.215 per share[5] - The company reported a total comprehensive income of HKD 679,190,000 for the year, up from HKD 586,691,000 in 2023[7] - The group’s profit after tax for 2024 is HKD 716,277,000, an increase from HKD 608,606,000 in 2023, reflecting an 17.7% growth[22] - The company's profit attributable to equity holders for 2024 was HKD 709,211,000, a 19% increase from HKD 593,673,000 in 2023[37] - The group's gross profit for the year was HKD 845,569,000, a 27% increase from HKD 663,634,000 in 2023, with a gross margin of 23%, up from 20% in the previous year[39] Revenue Breakdown - Revenue for the year 2024 reached HKD 3,627,126 thousand, an increase of 8.6% compared to HKD 3,341,729 thousand in 2023[17] - Revenue from the core shipping services segment increased by 26% to HKD 3,487,682,000, accounting for 96% of total revenue[38] - Paint sales generated HKD 1,344,147 thousand, up 62.5% from HKD 826,045 thousand in the previous year[17] - Ship equipment and spare parts sales increased to HKD 1,814,163 thousand, a growth of 5.2% from HKD 1,725,018 thousand[17] - Insurance consultancy commission income rose to HKD 220,994 thousand, reflecting a 58.2% increase from HKD 139,707 thousand[17] - The overall segment income from external customers was HKD 3,487,682 thousand, contributing to the total revenue[20] Assets and Liabilities - Total assets increased to HKD 9,333,570,000 from HKD 9,205,229,000 in 2023[8] - Total equity rose to HKD 8,209,339,000 compared to HKD 8,187,399,000 in 2023[8] - Total segment assets amounted to HKD 4,865,851 thousand, with significant contributions from joint ventures and associates[20] - Total assets for the reported segments increased to HKD 4,727,848,000 in 2024 from HKD 4,316,456,000 in 2023, a growth of 9.6%[22] - Total liabilities for the reported segments rose to HKD 1,047,600,000 in 2024, compared to HKD 933,949,000 in 2023, marking a 12.2% increase[23] - The company's total assets reached HKD 9,333,570,000 in 2024, up from HKD 9,205,229,000 in 2023, a growth of 1.4%[22] Dividends - The board proposed a final dividend of HKD 0.215 per share for the year ending December 31, 2024, compared to HKD 0.175 per share in 2023[61] - The total dividend for 2024 is projected to be HKD 0.48 per share, an increase from HKD 0.40 per share in 2023[61] - Interim dividend per share increased to HKD 0.265 in 2024 from HKD 0.225 in 2023[32] Operational Highlights - The company incurred research and development expenses of HKD 61,902,000 in 2024, up from HKD 33,275,000 in 2023[5] - The shipping services segment's profit before tax was HKD 627,800,000, up 25% from HKD 500,338,000 in 2023[68] - The coatings segment saw a substantial revenue increase of 63% to HKD 1,344,147,000, with pre-tax profit rising 29% to HKD 329,751,000[73] - The insurance consulting services segment reported a revenue increase of 58% to HKD 220,994,000, with pre-tax profit up 48% to HKD 141,916,000, benefiting from the acquisition of Haining Insurance Brokers and rising insurance rates[70] Corporate Governance - The company will change its auditor from PwC to ShineWing (Hong Kong) after the upcoming annual general meeting, as part of good corporate governance practices[85] - The company has appointed Shin Yong & Co. (Hong Kong) as the new auditor after considering various factors including audit service proposals and professional expertise[86] - The company confirms that there were no disagreements with the previous auditor, PwC, and expresses gratitude for their past services[87] - The company maintains a high level of corporate governance and continues to implement measures to enhance governance and risk management[90] - The board believes it has complied with the corporate governance code during the year, with some deviations noted regarding attendance at the annual general meeting[91] Future Outlook - The company is focusing on green and digital transformation, aiming to strengthen core competitiveness through new technologies and low-carbon services[65] - By 2025, the company aims to become a technology-driven shipping service provider, focusing on digital intelligence and green low-carbon initiatives[78] - The company plans to leverage AI, blockchain, and proprietary algorithms to enhance industry integration and maximize synergy benefits[79] - The container coating business may face increased competition in 2025, impacting pricing and profit margins, but the company aims to expand its market share[82] - The company is advancing the construction of a green methanol production project, with plans to start construction by April 2025 and aim for production by late 2026[83]

Financial Performance - For the first half of 2024, profit attributable to equity holders was HK$388,041,000, a 16% increase from HK$335,917,000 in 2023, with basic and diluted earnings per share rising to 26.47 HK cents, up 17% from 22.69 HK cents [88]. - The Group's revenue for the six months ended June 30, 2024, was HK$1,752,887,000, an 8% increase from HK$1,620,612,000 in 2023, with core shipping services revenue at HK$1,667,279,000, up 15% year-on-year [89][90]. - Gross profit for the same period was HK$401,628,000, a 17% increase from HK$343,129,000 in 2023, with an overall gross profit margin of 23%, up 2 percentage points from 21% [91][92]. - Operating profit decreased by 7% to HK$135,886,000 from HK$145,892,000 in 2023, primarily due to increased selling, administrative, and general expenses [96]. - Profit for the period reached HK$392,428,000, a 12.8% increase from HK$347,691,000 in the previous year [157]. - Total comprehensive income for the period was HK$382,810,000, compared to HK$281,296,000 in the same period last year, marking a 36.1% increase [157]. Expenses and Income - Management fee income from services provided to COSCO SHIPPING (Hong Kong) and its subsidiaries was HK$36,256,000, a 4% decrease from HK$37,910,000 in 2023 [93]. - Other income and gains (net) decreased by 65% to HK$13,627,000 from HK$38,764,000 in 2023, primarily due to a reduction in foreign exchange gains [94]. - Selling, administrative, and general expenses increased by 15% to HK$315,625,000 from HK$273,911,000 in 2023, mainly due to increased employee benefits from the acquisition of Helen Insurance Brokers [95]. - Financial income, mainly from interest on bank deposits, increased by 16% to HK$140,095,000 from HK$120,495,000 in 2023, attributed to rising deposit interest rates [97]. Dividends and Shareholder Returns - The company declared an interim dividend of 26.5 HK cents per share, with the payment date set for September 25, 2024 [86][87]. - The Company declared an interim dividend of 26.5 HK cents per share for the six months ended June 30, 2024, up from 22.5 HK cents in 2023, reflecting a year-on-year increase of 17.8% [115]. - The company paid dividends totaling HK$256,545,000 during the period, compared to HK$169,174,000 in the previous year, which is an increase of approximately 51.7% [170]. Acquisitions and Market Developments - The Group completed the acquisition of Helen Insurance Brokers in January 2024, contributing to increased commission income from the insurance brokerage segment [90]. - The acquisition of Helen Insurance Brokers was completed on January 15, 2024, for a consideration of HK$270,980,600, making it a wholly-owned subsidiary [140]. - The shipbuilding market experienced strong demand, with 1,170 new ships ordered globally in the first half of 2024, representing a year-on-year increase of 15.5% in deadweight tonnage [117]. - The ship trading agency segment's revenue grew by 36% year-on-year to HK$49,554,000, with profit before income tax increasing by 41% to HK$36,525,000, attributed to a higher number of new build vessel deliveries [121]. Employee and Operational Metrics - As of June 30, 2024, the Group had 846 employees, a decrease from 860 employees as of December 31, 2023, with 193 employees based in Hong Kong [110]. - Total employee benefit expenses for the period amounted to HK$231,390,000, representing an increase of 8.5% compared to HK$212,770,000 for the same period in 2023 [110]. Cash Flow and Financial Position - Total cash and deposits as of June 30, 2024 amounted to HK$6,008,533,000, down from HK$6,261,376,000 as of December 31, 2023 [106]. - Cash generated from operating activities for the six months ended June 30, 2024, was HK$41,378,000, compared to HK$242,356,000 for the same period in 2023, representing a decrease of approximately 83.0% [172]. - The total cash and cash equivalents at the end of the period increased to HK$2,038,714,000 in 2024 from HK$1,331,575,000 in 2023, marking a growth of approximately 53.1% [172]. Market Trends and Future Outlook - In the first half of 2024, total goods imports and exports in China reached RMB21.17 trillion, marking a year-on-year increase of 6.1% [118]. - The global shipping market saw a significant price increase due to supply chain disruptions and higher-than-expected demand in Asia-Europe trade [117]. - The average freight rates are expected to remain at a high level due to a tight balance in the shipping market [143]. - The demand for container coatings is expected to positively impact from the shipping detour and high shipbuilding completion standards this year [145]. Strategic Focus and Innovations - The Group's focus on green shipping and digital solutions is evident through its dual-platform development strategy, which includes a green new energy platform and intelligent shipping services [120]. - The Group aims to build robust platforms for green and digital intelligent shipping services, facilitating higher-quality development in the green, low-carbon, and digital economy [146]. - The European Union's Emission Trading Scheme (EU ETS) and Fuel EU regulations are set to accelerate the adoption of alternative fuels in the global shipping industry [146].

Investment Rating - The report assigns a "Buy" rating to COSCO SHIPPING International (0517.HK) with a target price of HKD 5.20, based on a 10x PE ratio for 2025 [1][3]. Core Insights - The company reported a revenue of HKD 1.75 billion for the first half of 2024, representing an 8% year-on-year growth, with a net profit of HKD 390 million, up 15.5% year-on-year [2][3]. - The shipping market's activity level is crucial for the development of the company's shipping services, with significant growth in ship trading agency services and insurance consulting services [2][3]. - The demand for ship coatings is supported by a robust new shipbuilding market, with the company achieving a sales volume of 78,795 tons in ship coatings for the first half of 2024 [2][3]. Summary by Sections 1. Company Overview - COSCO SHIPPING International is a leading comprehensive shipping service company, providing a full lifecycle of services for ships and focusing on green and digital transformation [10][12]. 2. Green and Low-Carbon Shipping Transformation - The company is accelerating its green low-carbon transformation, responding to market trends and increasing demand for environmentally friendly fuels [25][27]. - A joint venture for renewable fuel investment has been established to promote the transition to green energy in the shipping industry [31][32]. 3. Revenue and Profitability - The company expects steady growth in its shipping services, with projected revenues of HKD 3.65 billion, HKD 3.66 billion, and HKD 3.73 billion for 2024-2026 [3][4]. - The main revenue sources include ship equipment supply and coatings, contributing significantly to the overall profitability [10][11]. 4. Market Dynamics - The global shipbuilding market remains active, with China maintaining its position as the world's largest shipbuilding country, capturing over 50% of the market share in various metrics [21][22]. - The demand for ship coatings is expected to rise due to the growth in both new ship deliveries and repair services [23][24].

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其準確性或完整性亦不 發表任何聲明，並明確表示，概不對因本公告全部或任何部份內容而產生或因倚賴該等內容而引致的任何損 失承擔任何責任。 （ 於百慕達註冊成立的有限公司） （股份代號：00517） 2024年中期業績 | --- | --- | |-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | | | | | 業績 及 營 運 概 要 | | . | 收 入 上 升 8 %至1,752,887,000 港 元 ， 主 要 由 於 塗 料 及 保 險 顧 問 的 分 部 收 入 上 升 。 | | . | 毛 利 上 升 17% 至 401,628,000 港 元 ， 主 要 由 於 塗 料 分 部 毛 ...