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CAO profit up 26% for Q3 on lower expenses
CHINA Aviation Oil (Singapore) (CAO) posted a 26.0 per cent rise in net profit to US$23.9 million for its third quarter ended Sept 30, from US$18.9 million a year ago.
This was mainly due to higher gross profit and lower operating expenses, partially offset by a lower share of results from associates, the jet fuel trader said on Friday in a regulatory filing.
Earnings per share stood at 2.77 US cents, up from 2.20 US cents a year ago. No dividend was declared for the quarter, unchanged from a year ago.
Revenue for Q3 fell 12.2 per cent to US$5.56 billion, from US$6.33 billion a year ago, mainly from lower oil prices.
Gross profit rose 47.1 per cent to US$16.3 million, from US$11.1 million a year ago. This was primarily due to higher jet supply volume and higher profits from trading and optimisation activities, the group added.
Total expenses about halved to US$3.8 million for the third quarter, from US$8.2 million the year prior. This was mainly from the reversal of provision for expected credit loss of US$2.2 million, compared with an expected credit loss provision of US$1.6 million for the same period a year ago. Furthermore, improved capital management also resulted in lower interest expenses incurred on discounting letters of credit.
Meanwhile, the share of profits from associates fell 28.1 per cent to US$12.6 million from US$17.50 million the year before, mainly due to lower profit contributions from Pudong.
CAO chief executive and executive director Wang Yanjun said the group will continue to focus on driving long-term profitability through new market expansion for the supply and trading of jet fuel and other oil products.
"At the same time, we are proactively looking to invest in synergetic assets to strengthen the group’s growth platform," he said, adding that the group will continue to manage risks and exercise financial prudence for sustainable growth.
Shares of CAO were trading at S$1.25 as at 1.43pm, up three Singapore cents or 2.5 per cent, after the results were announced.