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China Aviation Oil Q2 profit up 14.4%

HIGHER gross profit and stable profit contributions from its associates gave a fillip to China Aviation Oil (Singapore) Corporation's (CAO) second-quarter results, which saw the jet fuel trader recording a 14.4 per cent rise in net profit to US$29.3 million.

Earnings per share (EPS) for the quarter came in at 3.4 US cents, up from 2.98 US cents in the year-ago period.

Meanwhile, revenue jumped 57.9 per cent to US$5.8 billion, mainly due to higher oil prices, and an increase in supply and trading volume. 

For the six months to June 30, net profit attributable to equity holders also rose 14.2 per cent to US$56.2 million, translating to an EPS of 6.53 US cents, up from 5.72 US cents last year.  

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Revenue for H1 2018 rose 41.8 per cent to US$9.9 billion, driven mainly by the increase in oil prices, and a 12.1 per cent increase in total supply and trading volume to 17.56 million tonnes, CAO said. 

Volume for other oil products also surged 42.6 per cent to 8.74 million tonnes for the first half of the year, mainly attributable to the increase in the supply and trading volume for crude oil.

Overall, profit contributions from CAO's associated companies rose 19.2 per cent to US$39.6 million for the six months to June 30.

In particular, share of profits from its key associate - Shanghai Pudong International Airport Aviation Fuel Supply Company - increased 19.1 per cent to US$34.6 million due to higher refuelling volumes. 

Profit contribution from associate Oilhub Korea Yeosu was also up by 24 per cent to US$3.4 million, mainly attributable to higher operating profits from its tank storage leasing activities.

Said CAO's chief executive officer, Meng Fanqiu: "Despite major uncertainties in the oil markets, and the broader global economic and geopolitical outlook, we are pleased that CAO has continued to progress well and achieved a strong set of results for H1 2018."

He added that China Aviation Fuel Europe (CAFEU) will strengthen the group's global presence, and provide it with a springboard to further grow its portfolio in the European region. 

As at 2.55pm on Wednesday, shares in CAO were trading at S$1.54 apiece, up 2.7 per cent, or four Singapore cents.