China Aviation Oil posts 3% rise in H1 net profit

JET fuel trader China Aviation Oil (CAO) G92 on Friday posted a 3 per cent rise in net profit for the fiscal first half from a year ago, mainly due to an increase in its share of earnings from its associate companies, it said.

Net profit for the six months ended June 30, 2021, stood at US$24.3 million, compared with US$23.6 million a year ago.

A 31.4 per cent drop in gross profits partially offset these gains, however, which it said is due to its main jet fuel supply business continuing to bleed and lower gains made from trading and optimisation efforts.

The results translate to earnings per share of 2.82 US cents, up 2.9 per cent from 2.74 US cents in the year-ago period.

Revenue was up 61.6 per cent to US$8.68 billion due to increases in oil prices, as well as an increase of 34.8 per cent in CAO's total supply and trading volume compared with H1 2020.

This rise in volume traded for CAO's other oil products was led by trade in crude oil, up 88.7 per cent to 10.4 million tonnes year-on-year.

Commenting on the company's performance in a bourse filing on Friday, CAO's chief executive Wang Yanjun noted that the recent resurgence of Covid-19 infections has continued to exert a severe impact on the global aviation industry.

"While market conditions are expected to continue to remain challenging globally, CAO remains cautiously optimistic on its performance for the current financial year as the group continues to navigate through this unprecedented period," he said. "The group will stay the course to build on its jet fuel supply and trading network complemented with trading in other oil products.

"The group will also continue to focus on long-term profitability by seeking opportunities for expansion through investments in synergetic and strategic oil-related assets and businesses."

The board declared that no interim dividends would be paid out for the financial periods ended June 30, 2021 or June 30, 2020.

CAO separately announced the resignation of vice-president Zhang Xingbo following the completion of his secondment term with the company. Mr Zhang, who was seconded from China National Aviation Fuel Group, was appointed vice-president on Sept 1, 2017 and will end his term on July 31, 2021.

Shares of CAO were flat at S$1.01 as at 4.18pm on Friday.