Order volume hits a 13-year high! Yangtze River Shipbuilding announces its first-quarter results

New orders reached a record high of US\$4 billion in 2020, the highest since 2008, with outstanding orders reaching their highest level since 2009, and net profit increasing by 89% year-on-year to 760 million yuan... In the first quarter of 2020, Yangzijiang Shipbuilding Group once again delivered impressive results.

On April 29, Yangzijiang Shipbuilding Group released its financial performance and related announcements for the first quarter of 2021. In the first quarter of 2021, the Group's total revenue decreased by 25% year-on-year to 2.6 billion yuan. Among them, the core shipbuilding business revenue was 1.8 billion yuan, lower than 2.3 billion yuan in the same period of 2020. Although the number of ships delivered was the same as in the same period last year, at an average of 12 ships, shipbuilding activities decreased in the first quarter of this year, resulting in a 20% decrease in revenue. Due to the expansion of the fleet size and the increase in charter rates, revenue from other ship-related businesses such as shipping logistics & chartering, ship design services, and shipbreaking increased to 186.5 million yuan, higher than 145.1 million yuan in the same period last year.

In the first quarter, Yangzijiang Shipbuilding Group's shipbuilding business gross profit margin was 15%, higher than 8% in the first quarter of 2020. This is mainly because the Group built more container ships and large vessels. The gross profit margin of other ship-related businesses in the first quarter was 37%, significantly higher than 21% in the first quarter of 2020, mainly due to the increase in charter rates. At the Group level, the gross profit margin increased by 11 percentage points year-on-year to 31% in the first quarter of this year, and the Group's gross profit was 802.3 million yuan, an increase of 12% year-on-year.

Yangzijiang Shipbuilding Group's net profit attributable to shareholders for the first quarter of 2021 was 761.7 million yuan, an increase of 89% compared with 403.8 million yuan in the same period of 2020. As of March 31, 2021, Yangzijiang Shipbuilding Group maintained a strong financial position, with net asset value per share increasing from 8.40 yuan at the end of 2020 to 8.600 yuan.

Following the strong performance of the global shipbuilding industry in the fourth quarter of last year (quarterly order volume in terms of deadweight tonnage reached a new high since 2018), the global new ship order volume continued to remain strong in the first quarter of this year, supported by strong demand for container ships. According to BIMCO data, the new order volume for container ships in the first quarter of this year reached 1.4 million TEU, not only exceeding the 1 million TEU order volume for the whole year of 2020, but also higher than the annual order volume since 2015. Affected by this, the proportion of container ship backlog orders to the existing fleet has jumped from 8.8% six months ago to over 15%.

Relying on its expertise and reputation in the construction of container ships, Yangzijiang Shipbuilding Group's order intake this year has reached a new high since 2008, and has completed its annual order target of US\$3 billion ahead of schedule. From the beginning of the year to date, Yangzijiang Shipbuilding Group has received a total of 75 new ship orders with a total value of US\$4.01 billion, including 51 container ships (4 24000TEU, 10 15000TEU, 5 12200TEU, 4 11800TEU, 10 4600TEU, 4 2600TEU, 2 2400TEU and 12 1800TEU), 22 bulk carriers (14 82300 DWT, 4 66000 DWT and 4 31800 DWT Great Lakes type bulk carriers), and 2 50000 DWT MR product tankers.

Yangzijiang Shipbuilding Group emphasized that the vast majority of the new ship orders received this year are container ships, totaling 51 ships with a value of US\$3.36 billion, which is expected to maintain the Group's profit margin. As of the date of this announcement, Yangzijiang Shipbuilding Group has a total backlog of 146 ships with a value of US\$6.6 billion, the highest level since 2009, which will provide the Group with a stable source of income for at least the next two years.

Ren Litian, Executive Chairman and CEO of Yangzijiang Shipbuilding Group, said: \"Yangzijiang Shipbuilding Group is a major beneficiary of the strong demand for container ship orders since the fourth quarter of 2020, thanks to the Group's strong position in this market. Our current backlog has reached its highest level since 2009. In order to increase capacity, the Group will resume operations of Jiangsu Yangzi Changbo Shipbuilding in the second quarter of 2021. The restart of Yangzi Changbo Shipbuilding will enable the Group to deliver 6-7 medium-sized vessels per year. I would also like to thank our customers for their trust in Yangzijiang Shipbuilding Group. We will continue to strive to be one of the best shipyards in the world. We will continue to lead in environmental regulations, aiming to play a role in the decarbonization of the shipbuilding industry and improve our ability to build environmentally friendly ships.\"