Fleet and Operations - As of December 31, 2018, COSCO SHIPPING Energy Transportation owned and controlled a fleet of 151 oil tankers with a total deadweight tonnage of 21.88 million tons, making it the largest fleet globally[4]. - The company has invested in 38 LNG vessels, with 26 currently in operation, totaling 4.35 million cubic meters, and 12 under construction, totaling 2.08 million cubic meters[4]. - The company maintained a market share of over 55% in the coastal crude oil transportation sector, solidifying its position as a leading enterprise in this field[11]. - The company is a leader in the LNG transportation business in China, with investments in 38 LNG vessels, of which 26 are operational, totaling 4.35 million cubic meters[13]. - The company has signed long-term charter contracts for all its LNG vessels, ensuring stable rental income and investment returns[13]. - The company completed the acquisition of the PetroChina refined oil fleet, becoming a leader in domestic refined oil transportation, with revenue from this segment increasing by 45.8% year-on-year[19]. - The company controlled oil tanker capacity reached 648,959 deadweight tons, a year-on-year increase of 17.0%[18]. - The company plans to add 16 new oil tankers with a total deadweight tonnage of 3.058 million tons over the next three years, with projected capital expenditures of RMB 6.45 billion[122]. - The company plans to add 1 oil tanker with a deadweight tonnage of 114,000 tons and 9 LNG vessels with a total capacity of 1.553 million cubic meters, aiming for a total operational fleet of 152 oil tankers and 35 LNG vessels[58]. Financial Performance - Total assets as of December 31, 2018, amounted to RMB 63.42 billion, an increase from RMB 60.39 billion in 2017[8]. - The equity attributable to owners of the company was RMB 28.19 billion as of December 31, 2018, slightly up from RMB 27.92 billion in 2017[9]. - The company's revenue from continuing operations for the year ended December 31, 2018, was RMB 12,099,685,000, an increase from RMB 9,504,935,000 in 2017, representing a growth of approximately 27%[10]. - The profit from continuing operations before tax was RMB 413,063,000, down from RMB 2,055,013,000 in 2017, indicating a decline of about 80%[10]. - The net profit attributable to the company's owners for the year was RMB 74,679,000, a significant decrease from RMB 1,774,648,000 in 2017, reflecting a decline of approximately 96%[10]. - The company's main business revenue for 2018 was RMB 12.1 billion, a year-on-year increase of 14.8%[20]. - The group's other income and net gains from continuing operations in 2018 were approximately RMB 222 million, a decrease of about 75% compared to 2017, primarily due to a reduction in government subsidies by approximately RMB 407 million and a foreign exchange loss of about RMB 84 million compared to a foreign exchange gain in 2017[125]. - The group's income tax for 2018 was approximately RMB 120 million, a decrease of about 26% compared to 2017, mainly due to fluctuations in the shipping market leading to a decline in taxable profits from domestic operations in China[125]. Market and Industry Outlook - The international oil tanker transportation market is characterized by significant price volatility influenced by international political and economic factors, with daily earnings for VLCCs ranging from $12,800 to $105,000 over the past two decades[12]. - The coastal oil transportation market in China is relatively stable, with a balanced supply and demand, leading to higher price stability compared to the international market[13]. - The company anticipates continued healthy growth in the international oil transportation market in 2019, supported by stable oil consumption growth and changes in cargo structure[53]. - The global LNG consumption growth rate is projected at 1.7% annually from 2019 to 2040, with LNG demand expected to double compared to 2017 levels, primarily driven by Asian countries like China[55]. - The price of new VLCC vessels increased by approximately 14% from USD 81.5 million to USD 93 million per vessel between early 2018 and January 2019, which may suppress the growth of new orders[53]. Cost Management and Efficiency - The company implemented lean management to control costs, with total operating costs rising to approximately RMB 10,300 million, a 38.5% increase year-on-year[27]. - The company implemented fuel efficiency management measures, saving approximately 86,200 tons of fuel, which resulted in a cost saving of about RMB 288 million[29]. - The average fuel consumption of the fleet was reduced by 9.2% to 2.04 kg per thousand tons of cargo[29]. - Fuel costs accounted for 31.5% of the company's main business costs in 2018, up from 27.2% in 2017, indicating increased exposure to fuel price volatility[120]. - The company has implemented energy-saving technologies and economic sailing speeds to reduce fuel consumption and manage procurement costs[120]. Corporate Governance and Compliance - The company revised its Articles of Association and related rules in 2011 to enhance corporate governance and ensure compliance with regulatory requirements[61]. - The company adopted a board diversity policy in 2013 to ensure a balanced composition of skills, experience, and perspectives among board members[61]. - The company has established a comprehensive internal control system, completing the update of the internal control manual for the fiscal year 2015[64]. - The company has continuously improved its internal management operations through effective checks and balances among various governance bodies[62]. - The independent non-executive directors found no areas needing improvement in corporate governance and compliance with national laws and regulations in 2018[193]. Strategic Initiatives and Future Plans - The company aims to enhance its operational capabilities and service quality to meet the growing demand in the energy transportation sector[2]. - The company plans to expand its LNG transportation business and develop new projects, focusing on the Arctic shipping route to enhance its competitive edge in LNG vessel management[59]. - The company is committed to strengthening its industry leadership by innovating technology and establishing a research center to enhance market research capabilities[59]. - The company prioritizes talent development to build a high-quality, professional, and international workforce, fostering a culture that encourages performance and skill enhancement[59]. - The company has established a dedicated investor relations department to enhance communication with investors and analysts[109]. Risk Management - The company faces significant risks from macroeconomic fluctuations, which can impact demand for shipping of bulk resources like oil and LNG[117]. - The company is exposed to competition from other transportation methods, which may reduce the demand for its services despite the growth in oil imports[118]. - The company has taken measures to mitigate piracy risks, which remain a significant threat to shipping safety[121]. - Currency exchange rate fluctuations may impact the company's operations due to a portion of revenues and costs being denominated in USD[123]. Employee and Compensation - The total employee cost for the company in 2018 was approximately RMB 2.153 billion, an increase from RMB 1.874 billion in 2017[158]. - The company has developed a salary system combining position wages, seniority wages, performance wages, and auxiliary wages to incentivize employees[68]. - The company has a compensation and assessment committee chaired by independent non-executive director Ye Chengzhi[138]. - The total number of stock options granted under the incentive plan is 35,460,000, accounting for approximately 0.88% of the company's total issued shares as of the report date[165]. Shareholder Relations - The company emphasizes a sustainable dividend policy, balancing shareholder expectations with prudent capital management[108]. - The board proposed a final dividend of RMB 0.02 per share for the year, pending approval at the upcoming annual general meeting[115]. - The company has established a special account for the use of raised funds, ensuring compliance with relevant laws and regulations[182]. - The company actively participated in shareholder meetings and board meetings, providing independent opinions on significant matters for long-term development[194].