Yangzijiang Shipbuilding H2 net profit rises 64.7% on rise in shipbuilding revenue

YANGZIJIANG Shipbuilding on Tuesday (Feb 27) reported net profit of 2.4 billion Chinese yuan (S$443.2 million) for the second half of the financial year ended Dec 31, 2023, up 64.7 per cent from 1.4 billion yuan in the corresponding year-ago period.

On a per-share basis, earnings rose to 60.13 yuan cents from 36.51 yuan cents.

During this period, revenue for the company’s shipbuilding segment experienced a substantial increase of 23 per cent, reaching 12.1 billion yuan, versus 9.9 billion yuan in the previous year.

The group saw a significant increase in the gross profit margin for this segment, which rose to 26 per cent in H2 2023, from 13 per cent for the same period in FY2022.

The group attributed this improvement to the depreciation of the yuan against the US dollar, reduced raw material costs and improved new build price of vessels being constructed during the period. 

The sale of a jack-up rig in H2 FY2023 also contributed positively to the gross profit margin, it added.

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Yangzijiang’s shipping business segment recorded a gross profit margin of 35 per cent in the half-year. This represents a six-percentage-point decrease from the 41 per cent margin achieved in the year-ago period. 

This decline in gross profit margin, the group said, was due to “reduced charter rates for bulk carriers, especially domestic vessels operating in China during the period”.

Revenue rose 16.7 per cent year on year in H2 FY2023, to 12.8 billion yuan.

For the full year, the group’s revenue was up 16.5 per cent to 24.1 billion yuan, while earnings jumped 46.1 per cent to 4.1 billion yuan, from a net profit of 2.8 billion yuan in the previous year.

The board has proposed a final cash dividend of 6.5 Singapore cents per ordinary share, higher than the dividend of 5 cents per share that it announced for the corresponding period in FY2022. 

Shares of Yangzijiang Shipbuilding fell 1.2 per cent or S$0.02 to close at S$1.67 on Tuesday, before the results’ release.