SINGAPORE (Aug 7): China Aviation Oil (Singapore) Corporation (CAO), the largest physical jet fuel trader in the Asia Pacific region, reported earnings of US$28.4 million ($39.2 million) for the 2Q19 ended June, some 2.9% lower than earnings of US$29.3 million a year ago.
This translated to lower earnings per share of 3.31 US cents for 2Q19, compared to 3.40 US cents in 2Q18.
This brings earnings for 1H19 to US$54.8 million, down 2.5% from US$56.2 million in 1H18.
2Q19 revenue rose 2.9% to US$5.97 billion, from US$5.80 billion a year ago.
The increase was due to a 16.7% rise in revenue from middle distillates to US$3.64 billion during the quarter, largely due to an increase in volume.
Volume for middle distillates products increased 25.7% to 5.72 million tonnes in 2Q19, from 4.55 million tonnes a year ago, led by 19.4% higher volume of jet fuel supply and trading.
This was partially offset by lower revenue from other oil products, which fell 13.2% to US$2.33 billion in 2Q19.
However, operating profit shrank 6.6% to US$10.9 million in 2Q19, on the back of higher expenses.
Total expenses increased by 36.0% to US$8.0 million for 2Q19, mainly attributable to higher provision for expected credit loss.
Other operating expenses more than trebled to US$4.6 million, from US$1.4 million a year ago.
The share of profits from associates rose 3.0% to US$19.2 million for 2Q19, mainly due to higher profit contributions from Shanghai Pudong International Airport Aviation Fuel Supply Company (Pudong).
As at end June, cash and cash equivalents stood at US$210.4 million.
Wang Yanjun, chief executive officer and executive director of CAO, says: “In spite of the challenging conditions in the oil markets and the continued uncertainties in the macroeconomic environment… our middle distillates business has continued to see growth, driven by an increase in jet fuel supply and trading volumes.”
“Moving forward, the group will continue to tap synergies created from our enhanced global supply and trading network and seize opportunities in strategic oil-related assets and businesses,” he adds.
As at 3.18pm, shares in CAO are trading 2 cents higher, or up 1.7%, at $1.20.
