CFO Lim Kai Ching presenting at the 3Q15 briefing last Friday. Photo by Reyna Mei
UNI-ASIA HOLDINGS, despite a challenging shipping market, would have delivered a handsome 9M2015 bottomline if not for fair value losses on its ships.
Net profit (US$'000) in 9M2015 | |
Non-consolidated Uni-Asia (Investment & Asset Management of Vessels & Properties in China/HK) |
(2,091) |
Uni-Asia Shipping Ltd Ship Owning & Chartering |
1,438 |
Uni-Asia Capital (Japan) Ltd Properties in Japan |
3,355 |
Uni-Asia Hotels Ltd Hotel Operation in Japan |
466 |
Group total | 3,041 (+3%) |
Uni-Asia's total income for 9M2015 rose 12% to US$56 million while operating profit rose 38% to US$6.9 million.
But the shipping market continued to be depressed in 3Q2015, resulting in Uni-Asia having to recognise further fair value losses.
Total fair value losses on its ships for 9M2015: US$3 million (compared to US$484K in 9M2014).
Though non-cash in nature, the fair value loss was big vis-a-vis the operating profit of US$6.9 million.
In fact, the fair value loss on the ships of US$1.61 millon in 3Q dragged the 3Q bottomline (attributable to shareholders) into the red to the tune of US$1.3 million.
As a result, the 9M profit attributable to shareholders was US$2.7 million, down 10% y-o-y.
While the capital values of the ships dropped, and with a sustained market recovery not on the cards in the near-term, their charter income continued to rise -- as the fleet expanded.L-R: COO Masaki Fukumori, Executive Chairman Michio Tanamoto & CFO Lim Kai Ching. Photo by Reyna Mei.Charter income increased by 62% to US$22.5 million in 9M2015, as ship owning subsidiary Uni-Asia Shipping took delivery of 2 new vessels in February 2015 and March 2015, increasing the fleet size of dry bulk carriers owned to 8 as at 30 Sept 2015.
Furthermore, a containership acquired in April 2015 contributed charter income, reflecting the group's strategy of building up recurring charter income.
Property & hotel -- bright spots
Aside from strong charter income, Uni-Asia did well in its property business in Japan. Realised gains on its hotel and property investments amounted to US$1.58 million in 9M2015 while realised gains on small residential property developments stood at US$525K.
There's even more upside next year: While Uni-Asia has only 2 residential projects completed this year, it will have six next year -- starting from Feb 2016 till Aug 2016.
Similarly, next year will also see one more hotel -- the 238-room Hotel Vista Sendai -- starting to contribute to the group when it opens in spring.
Uni-Asia's hotel operations recorded a US$330K net profit in 3Q on higher average room rates, accounting for the bulk of the 9M profit of US$466K.
Uni-Asia stock traded recently at S$1.23, or just 0.3 of the book value of US$2.97 per share.
![]() "These endorsements will spur us to work our harder to optimise shareholders’ value, in return for their trust over the years.” -- Michio Tanamoto (photo), executive chairman of Uni-Asia Holdings. |
The 3Q2015 Powerpoint materials are here.