Yang Ming Marine Transport Corp (陽明海運) on Thursday reported that it returned to the black last year with a profit of NT$11.98 billion (US$418.9 million), after a net loss of NT$4.3 billion in 2019, thanks to increased revenue, higher freight rates and relatively low bunker fuel prices.
Earnings per share last year reached NT$4.51, after losses per share of NT$1.66 in 2019, while revenue rose 1.4 percent to NT$151.28 billion, up from NT$149.18 billion, the company said, adding that gross margin rose to 17.24 percent, thanks to lower fuel costs.
The company’s board of directors decided not to distribute a cash dividend this year, continuing a policy began in 2011.
Photo: Ann Wang, Reuters
Yang Ming chairman Cheng Cheng-mount (鄭貞茂) has prioritized improving the company’s financial outlook, and last year’s earnings might be used to offset the firm’s accumulated losses.
Yang Ming said that the container shipping market experienced a downturn in the first half of last year due to the COVID-19 pandemic, but demand has increased since mid-August.
“The rebound was supported by a change in consumer behavior since COVID-19 lockdowns, including an accelerated adoption of e-commerce, and an increased need for hygiene products, housewares and work-from-home essentials,” Yang Ming said in a statement.
“Due to sudden inventory buildup, the surge in demand resulted in a global shortage of empty containers and capacity constraints, which led to an increase in freight rates on East-West and intra-Asia trade routes,” it said.
The upward trend continued through the end of last year, resulting in a fourth-quarter net profit of NT$10.12 billion, up from NT$1.85 billion in the previous three quarters, the company said.
The strong performance helped it eliminate the accumulated deficit by the end of last year, Yang Ming said.
To further enhance its financial outlook, the company said that it would increase capital by issuing up to 300 million new common shares and establish public underwriting through book building.
Yang Ming shares on Friday rose 1.5 percent in Taipei trading to close at NT$34.
The company’s share price has so far this year advanced 16.24 percent, compared with a 10.68 percent increase in the broader market, Taiwan Stock Exchange data showed.
Capital Investment Management Corp (群益投顧) on Friday retained a “buy” rating for the stock, saying that the company’s profit this quarter is expected to be higher than last quarter’s, as the container shipping market would benefit from higher freight rates on European and US routes.
“Major global container shippers have recently signaled that the market boom might continue through the third quarter of 2021, indicating that the shortage of containers and the port congestion have not yet been resolved in the short term,” Capital said in a note.
“It is expected that the freight rates on European routes will stop falling when the industry enters its peak season, and the freight rate on US routes will stay high due to persistent congestion at ports,” it said. “This will help support container shippers’ operating performance in the second quarter of 2021.”
STEADY: Prices are to rebound following inventory rebuilding demand, TrendForce said, with Samsung Electronics Co further trimming capacity as it slashes DDR4 lines The contract prices of DRAM chips are to rise by as much as 18 percent sequentially this quarter — the first price upticks in about eight quarters — driven mainly by inventory rebuilding demand for DRAM chips used in mobile devices and PCs, TrendForce Corp (集邦科技) projected yesterday. The price rebound is led by a quarterly increase of mobile DRAM chips, which are to climb between 13 percent and 18 percent quarter-on-quarter this quarter, which has not been seen since the fourth quarter of 2021, the Taipei-based market researcher predicted. Likewise, the price of mainstream PC DDR4 DRAM is expected to bounce
CHINA NOT A FRIEND: ‘Newsflash: Democracy is good for your businesses,’ US Secretary of Commerce Gina Raimondo said as she gave a speech at a national defense forum US Secretary of Commerce Gina Raimondo on Saturday urged lawmakers, Silicon Valley and US allies to stop China from getting semiconductors and cutting-edge technologies key to national security. Speaking at an annual national defense forum in Simi Valley, California, Raimondo called Beijing “the biggest threat we’ve ever had” and stressed that “China is not our friend.” The world’s top two economies are locked in a fierce commercial and geopolitical rivalry, in which her department plays a leading role. In October, Raimondo unveiled a series of restrictions on the export of advanced chips to China, including those used in the development of artificial intelligence
SOLID FOUNDATION: Given its decades of expertise in megatronics, manufacturing and robotics, Japan has the wherewithal to create its own AI, Jensen Huang said Nvidia Corp plans to help build an artificial intelligence (AI) tech-related ecosystem in Japan to meet demand in a country eager to gain an edge in this emerging technology. The US company will seek to partner with Japanese research organizations, companies and start-ups to build factories for AI, Nvidia CEO Jensen Huang (黃仁勳) said yesterday during opening remarks in a meeting with Japanese Minister of Economy, Trade and Industry Yasutoshi Nishimura. The company is to set up an AI research laboratory, and invest in local start-ups and educate the public on using AI, Huang said. Huang earlier this week met with Japanese Prime
A Hong Kong court postponed a court hearing on troubled Chinese property developer Evergrande Group’s (恆大集團) winding-up petition scheduled for yesterday until Jan. 29. Evergrande is trying to win support from its creditors for a plan to restructure more than US$300 billion in debt to stave off liquidation. The company’s lawyer told the court it was requesting an adjournment to “refine” its new debt restructuring plan. The Hong Kong High Court has postponed the hearing over Evergrande’s potential liquidation several times. Judge Linda Chan (陳靜芬) had said in October that yesterday’s hearing would be the last before a decision is handed down. Chan