[020418.EN.BIZ] Singamas Back in Black With US$41.4 Million Profit as Revenues Rise 61pc

THE world's second-largest container manufacturer, Hong Kong-listed Singamas reversed out of a 2016 annual loss of US$59.4 million with a $41.4 million profit in 2017, drawn on revenues of US$1.47 billion, which increased 61 per cent year on year, the company announced.

Second only to Shenzhen's CIMC, the Hong Kong company is a unit of Singapore's Pacific International Lines (PIL). Singamas has nine factories scattered throughout mainland China, and credits this year's good fortune to a reviving global economy that has roused shipping volume particularly in China.

"We are glad to have maintained profitable growth in the second half of 2017, with demand for new containers increasing since end of 2016," said Singamas chairman Teo Siong Seng.

"Furthermore, our joint venture with Guangxi and Singapore partners has been providing logistics solutions to customers since November 2017, whereas our liquid tank logistics operation in India commenced operation in January 2018," Mr Teo said.

Container manufacturing revenue came to $1.44 billion in 2017, up from $880.6 million in 2016, representing 97.7 per cent of total company revenue.

Dry freight containers again accounted for 85.5 per cent the total boxes made, though specialised containers remained a big part of the output.

During the year, Singamas also provided a wide range of products to suit different customer requirements, including fish farming containers. Fish farming containers are considered an efficient and environmentally friendly means of breeding fish as they remove the need to clear land or reserve bodies of water, said the company statement.

Offshore container sales improved on the back of rising oil prices and increased orders from container leasing operators.

As for development on the production front, the company completed construction of the offshore container factory in Qidong and the facility is used to produce high standard cabins now.

"The global economy has rosy prospects in 2018, with the World Bank forecasting growth of 3.1 per cent for it and the International Monetary Fund even more optimistic at 3.9 per cent," said the company statement.

"On the shipping front, cellular fleet growth is forecasted to rise by 5.6 per cent in 2018, according to Alphaliner, which should drive container demand. Stimuli are also expected to come from shipping and leasing companies both anticipating bullish prospects in 2018.

"Furthermore, Singamas will be introducing a new assembled-on-site refrigerated container system which is jointly developed with Carrier Transicold in the second quarter of 2018.

Said Mr Teo: concluded, "While dry freight containers will continue to be our primary and stable source of revenue, we expect specialised containers, particularly refrigerated containers, to be our growth driver, with the support of the Qingdao production lines that will commence operation in March 2018."

Source : HKSG.