Zhitong Finance APP learned that on March 31, China Merchants Port (00144) held a 2022 annual performance conference. At the meeting, regarding the level of demand for containers in 2023, the company responded that the overall decline from January to February compared with the same period last year, but the increase in western Shenzhen increased by 10,000. The strength of the rebound in March is still good, but compared with before the epidemic, the current figure is slightly lower than that of 2019, but the lower range is not too large. Since March, the export of ports in Greater China has basically returned to normal levels, and the recovery has been relatively obvious.
During the period, the company realized revenue of 12.545 billion Hong Kong dollars, an increase of 5.86% year-on-year; the profit attributable to the company’s equity holders was 7.781 billion Hong Kong dollars, a year-on-year decrease of 4.5%; the basic profit per share was 201.52 Hong Kong cents, and the final dividend was 60 Hong Kong cents per share .
According to the announcement, the year-on-year decrease in net profit was mainly due to the net gain (after tax) of HK$407 million included in the previous year including the deemed sale of part of the equity interest in an associate.
In 2022, the group will complete a container throughput of 136.53 million TEUs, a year-on-year increase of 1.1%, and a bulk cargo business throughput of 547 million tons; the annual revenue will be HK$12.545 billion, a year-on-year increase of 5.9%. Recurring profit attributable to equity holders of the Company was HK$8.121 billion, a year-on-year increase of 7.7%.
Benefiting from the increase in shipping routes, the Western Shenzhen Port Area completed a container throughput of 12.08 million TEUs, a year-on-year increase of 5.2%; completed a bulk cargo throughput of 10.6 million tons, a year-on-year increase of 0.4%. Guangdong Yide Port Co., Ltd. completed a container throughput of 410,000 TEU, a year-on-year decrease of 10.5%, mainly due to the impact of the international situation and inflation on cargo volume; completed a bulk cargo throughput of 6.27 million tons, a year-on-year increase of 20.9%, mainly benefiting from the development of terminals The cooperation between steel mills in the southern hinterland is stable, and the volume of goods is rising steadily.
Zhujiang Inland River Freight Terminal Co., Ltd. completed a total container throughput of 870,000 TEU, a year-on-year decrease of 15.3%, mainly due to the impact of the epidemic and changes in shipping prices; completed a bulk cargo throughput of 4.25 million tons, a year-on-year increase of 33.9%, mainly due to sand and gravel The business achieved substantial growth. Hong Kong’s Modern Terminals Co., Ltd. and China Merchants Container Services Co., Ltd. completed a total container throughput of 4.85 million TEU, a year-on-year decrease of 14.2%, mainly due to the impact of the epidemic and intensified regional competition.
Shanghai International Port (Group) Co., Ltd. completed container throughput of 47.3 million TEU, a year-on-year increase of 0.6%; completed bulk cargo throughput of 78.17 million tons, a year-on-year decrease of 5.1%. Ningbo Daxie China Merchants International Terminal Co., Ltd. completed a container throughput of 3.17 million TEU, a year-on-year decrease of 6.8%.
Looking forward to 2023, China Merchants Port will continue to grasp the general tone of the work of seeking progress while maintaining stability, and use the two-wheel drive model of “endogenous growth” and “innovation and upgrading” to focus on improving the expansion of home ports, focusing on innovation, optimizing operations, expanding layout, Seek business, risk prevention and other capacity building, do a good job in digitization, marketization, internationalization, platformization and smart work, continue to promote comprehensive and high-quality development, and strive to move towards a new journey of development.
The following is the Q&A record of China Merchants Port’s performance meeting organized by Zhitong Finance APP:
Q: Has the current infrastructure upgrade of ports in Greater China recovered compared to the situation at the end of last year?
Answer: The rebound in March is relatively obvious at present.
Q: Since late February, what are the specific changes in the company’s exports to Greater China ports?
Answer: Since March, we have learned that the peers have basically returned to normal levels, and the recovery is relatively obvious, but the sustainability remains to be judged. At present, the empty container level of the company’s Shenxi Wharf has fallen, dropping by about 30% from the highest point.
Q: What is the current level of demand for containers in 2023, roughly the level before the epidemic and the conflict between Russia and Ukraine?
Answer: First of all, compared with the same period last year, the overall decline in January and February, but the increase of 10,000 in the west of Shenzhen. The strength of the rebound in March is still good, but compared with before the epidemic, the current figure is slightly lower than that of 2019, but the lower range is not too large.
Q: How do you view the full-year demand in 2023?
Answer: Looking at the situation throughout the year, we now have a good layout. In China, we have the Yangtze River Delta, the Pearl River Delta, and the Bohai Sea. In addition, we include these key projects in the Belt and Road Initiative, such as Sri Lanka. So we follow China Merchants Port In terms of current holding projects and core project judgments, we think we are cautiously optimistic.
According to our judgment, we feel that there is hope to achieve positive growth, and whether it can be achieved depends on the situation in the second quarter.
Q: How has the crisis in Sri Lanka affected the company?
A: After the political crisis in Sri Lanka, the China Merchants Port headquarters attached great importance to it, and also resolutely implemented our three-guarantee work policy of ensuring safety, ensuring operation and ensuring supply.
Q: In the current geopolitical complex situation, how does the company conduct overseas acquisitions?
A: Since the beginning of this year, the current focus area will be around Southeast Asia, return to the RCEP area, and actively look for a commercially viable investment project.
Q: PSA International Port Group is considering selling its 20% stake in CK Hutchison’s port business. Will the company be interested?
Answer: This is also a big target, and it has a relatively large influence on this industry. Of course, for China Merchants Port, I think we are a commercial success, and these targets are judged by business, not that its layout is a single one, it is a package of projects. So we still have to look at it from the perspective of commercial feasibility, which is actually not clear to me.
Q: Does the customs’ judgment on the foreign trade situation have a big impact?
Answer: Generally speaking, ports are closely related to trade, so the growth of trade is also positively related to ports. From the perspective of foreign trade, it should be said that global trade is affected by many factors such as geopolitical inflation and no interest rate hikes. It should be said that global trade is weak and has brought great pressure to ports.
However, we believe that with the recovery of the economy, the Federal Reserve will raise interest rates for the last time, so the global port industry will become normal with the economy, especially the annual growth rate of the global shipping container volume is relatively normal.
Q: It is some achievements in digital transformation, what is the current situation? How will we further improve the development of higher quality in the future?
Answer: China Merchants Port should fully promote the work of digital transformation in recent years, and continue to build a new benchmark for smart ports. To briefly share with you a few facts, Mawan’s autonomous driving project was successfully selected as the first batch of pilot pilot applications for intelligent transportation by the Ministry of Transport.
In addition, China Merchants’ characteristic smart port solution was also successfully selected into the recommended list of central enterprises for scientific and technological innovation, and won the only special prize for scientific and technological progress of the China Ports Association in 2021. A technology company established by the company and Tencent called Gangcheng Internet has also officially launched the digital supply chain service of Mendaogang, especially the good luck platform for fleets and drivers has also received very good response.