Finance Association, January 23 (Reporter Hu Haoqiong) This evening, COSCO Haineng (600026.SH) announced its 2023 annual results announcement. Despite the expected increase in full-year results, COSCO Haineng's net profit for the fourth quarter is expected to be about -614 million yuan to 186 million yuan. Some analysts told the Financial Federation reporter that the logic of the 2023 peak oil season still exists, and freight rates are relatively high in recent years.

According to COSCO Haineng's announcement, throughout 2023, the company achieved net profit attributable to shareholders of listed companies of 3.1 billion yuan to 3.9 billion yuan, an increase of about 112.77% to 167.67% compared with the same period last year; net profit attributable to shareholders of listed companies after deducting non-recurring profit and loss was about 3.9 billion yuan to 4.7 billion yuan, an increase of about 180.37% to 237.89% compared with the same period last year.

COSCO Marine explained in its announcement that during the year, the company obtained revenue and deductions from disposal of old ships, etc.; at the same time, the net non-operating loss for the whole year was estimated to be 750 million yuan due to unconventional ship repairs, potential investment losses due to changes in the operating environment and operating restrictions of overseas joint ventures, and anticipated losses from third party claims.

Furthermore, judging from the industry in which the company operates, international tanker freight rates showed strong performance in 2023. The company's annual gross profit of foreign trade tankers was about 4.2 billion yuan, an increase of about 188% over the previous year. According to the Polish Stock Exchange, the average daily revenue (TCE) of the world's very large tanker (VLCC) Middle East to China route (TD3C) in 2023 was 3,035 US dollars/day, an increase of about 113% over the same period last year. Small and medium tankers benefit from international

Due to structural changes in oil trade, the overall performance of freight rates is strong.

The aforementioned analyst further stated that in the 2023 tanker market, the peak season logic for the fourth quarter still exists, but it is not as good as in 2022, mainly because there are still domestic crude oil import quotas in the fourth quarter of 2022, and there is no such quota in the fourth quarter of 2023, so inventories cannot be replenished. Despite this, the freight rate situation in the fourth quarter of 2023 will still be better than in 2021 and 2020.

In terms of domestic oil tanker business, COSCO Marine expects to achieve gross profit of about 1.5 billion yuan for the whole year, an increase of about 17.9% over the previous year; the LNG transportation business contributed about 790 million yuan to the company's net profit, an increase of about 18.4% over the previous year.

As for this year, in the context of the Red Sea incident, the oil transportation market was also affected to a certain extent. However, the Haitong Futures research report points out that from a fundamental perspective, the substantial favorable factors for VLCC shipping prices still depend on the recovery of Chinese demand. Recently, there are indicators showing a strong rebound in Dubai's monthly spread, which means that Chinese demand continued to be released after the devaluation of quotas and before the Spring Festival holiday, and the rise in VLCC shipping prices in the early stages is already reflected. As freight rates rise, charterers slow down the pace of shipments, and it is expected that next week's freight rates may face a certain risk of adjustment. In the short term, freight rates first entered a volatile adjustment range. The late-stage phased market still anchors geographical uncertainty and the release of Chinese buying demand.

According to Baltic Exchange data, as of January 22, 2024, the VLCC TD3C TCE was 39,433 US dollars/day, down from 49,640 US dollars/day on January 15.