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OOIL shareholders get US$6 total dividend per share for H1 2022 as “extraordinary conditions” in container shipping delivers US$5.75 billion EBIT
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Group revenue reached US$11.06 million, EBITDA was US$6.17 million and operating cashflow was US$6.24 million
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OOIL says H1 2022 produced the highest half-year revenue in its history despite total liner liftings falling 7% y-o-y and its total bunker costs rising 46%
Orient Overseas (International) Ltd (OOIL) is paying a US$6 dividend per share to shareholders for the first half of 2022 as “continuing extraordinary conditions” in the container shipping market delivered US$5.75 billion earnings before interest and tax to the Hong Kong-based listed holding company.
The parent of Orient Overseas Container Lines announced on August 22 a US$5.66 billion profit attributable to shareholders for the first half of 2022, a 101.49% jump from US$2.812 billion in the same period last year. Revenue was US$11.06 billion.
First-half earnings per ordinary share reached US$8.58, larger by 94.12% than the US$4.42 EPS in first-half 2021.
The board announced an interim dividend of about 70% or US$3.96 billion of the profit attributable to shareholders. This was equivalent to an interim dividend of US$3.43 per share and a special dividend of US$2.57 per share.
The stock closed at HK$217.20 on August 24, down 9.12% from its HK$237 opening price on Monday, hours before the interim results announcement.
“The outstanding performance of the group was driven by the continuing extraordinary conditions prevailing in the container shipping market,” OOIL announced to the Hong Kong Stock Exchange, where it is a blue-chip stock, a component of the benchmark Hang Seng Index.
OOIL said that for the past two years, the shipping market was “neither enjoying an extraordinary demand boom, nor suffering from any lack of vessels in deployment.”
Rather, better-than-expected but not phenomenally strong demand continued to outpace the effective level of supply that had been under significant downward pressure from congestion, delays and disruptions, the company said.
“These market forces pushed freight rates upwards on most trade lanes” and “[our]careful attention to cost control” have driven its strong profitability during the period, OOIL said.
The company said the first six months of 2022 produced the highest half-year revenue in the group’s history. Total liner liftings in the first half declined 7% year on year, while total revenue rose 61% and revenue per TEU surged 74%, OOIL said.
Its container shipping arm, OOCL, paid an average price of US$729 per ton of bunker fuel in the first half, up 62% from US$449 in the same period in 2021. That increased the liner’s total bunker costs by 46% in first half despite its lower fuel oil and diesel consumption.
OOIL said no new-build containership was delivered and it placed no new order. But next year, 12 containerships with 23,000-TEU capacity that it ordered in 2020 will be delivered.
Delivery of 10 vessels with 16,000-TEU capacity will take place between the fourth quarter of 2024 and fourth quarter 2025, the group said.
The group said for the first half this year, OOCL Logistics’ revenue and contribution had increased steadily compared with the same period last year. Operations, bunched as International Business Units, showed healthy growth amid rising demand for international logistics services.
In contrast, Domestic Logistics its maintained stable revenue despite fierce competition. With the streamlining processes and the use of IT systems, costs were further driven down, helping improve profitability.
As at June 30, OOIL’s total liquid assets were US$11.08 billion compared with debt obligations of US$805.7 million repayable within a year.
