Yang Ming Marine Transport Corp (陽明海運) yesterday reported net profit of NT$50.84 billion (US$1.83 billion) for last quarter — a company record — as high freight rates boosted revenue and gross margin.
In the third quarter, the container shipper posted revenue of NT$95.45 billion, up 145 percent from a year earlier, while gross profit totaled NT$64.77 billion, 10 times higher than a year earlier.
Yang Ming’s gross margin rose to 67.85 percent, up from 60.17 percent in the second quarter and compared with 14.64 percent a year earlier, although it was still lower than Evergreen Marine Corp’s (長榮海運) 69 percent, the companies’ data showed.
For the first three quarters, Yang Ming reported cumulative net profit of NT$109.88 billion and earnings per share (EPS) of NT$32.73, higher than Evergreen’s EPS of NT$30.27 and Wan Hai Lines Ltd’s (萬海航運) NT$28.37 over the same period, the companies’ data showed.
Yang Ming expects to reduce its debt-to-asset ratio, which totaled about 58 percent at the end of June, to below 50 percent by the end of this year, chairmen Cheng Chen-mount (鄭貞茂) told an event in Taipei on Wednesday.
Last year, routes to the US were the most profitable, but routes to Europe have been the most profitable this year due to congestion at US ports, Cheng said.
Given its record profits this year, the company plans to distribute dividends next year, but the amount has not yet been determined, he added.
Cheng said he remains upbeat about the outlook for the shipping business over the next two years, adding that the company would take delivery of new vessels over the next three years.
In related news, freight forwarder T3EX Global Holdings Corp (台驊國際投資控股) yesterday said that most shippers have forecast that sea cargo would increase in the first half of next year, despite risks such as port congestion and contract negotiations between workers’ unions and ports.
However, demand would still outgrow supply, likely keeping shipping rates elevated, T3EX said.
Yang Ming’s share price yesterday plunged 7.83 percent to NT$106 in Taipei trading, Taiwan Stock Exchange data showed.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
Hong Kong authorities ramped up sales of the local dollar as the greenback’s slide threatened the foreign-exchange peg. The Hong Kong Monetary Authority (HKMA) sold a record HK$60.5 billion (US$7.8 billion) of the city’s currency, according to an alert sent on its Bloomberg page yesterday in Asia, after it tested the upper end of its trading band. That added to the HK$56.1 billion of sales versus the greenback since Friday. The rapid intervention signals efforts from the city’s authorities to limit the local currency’s moves within its HK$7.75 to HK$7.85 per US dollar trading band. Heavy sales of the local dollar by
The Financial Supervisory Commission (FSC) yesterday met with some of the nation’s largest insurance companies as a skyrocketing New Taiwan dollar piles pressure on their hundreds of billions of dollars in US bond investments. The commission has asked some life insurance firms, among the biggest Asian holders of US debt, to discuss how the rapidly strengthening NT dollar has impacted their operations, people familiar with the matter said. The meeting took place as the NT dollar jumped as much as 5 percent yesterday, its biggest intraday gain in more than three decades. The local currency surged as exporters rushed to
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