Uni-Asia Group earnings down 82% y-o-y to $5.0 mil in FY2023 after shipping market normalisation

Bryan Wu
2-min read

Revenue was down 33% y-o-y to US$58.0 million in FY2023, with charter income falling 42% y-o-y to $37.8 million.

Uni-Asia Group CHJ has reported earnings of $5.0 million for the FY2023 ended Dec 31, 2023, 82% lower than its record earnings of $27.8 million in FY2022 as the shipping market normalised after an exceptional period post-Covid period from 2021 to 2022.

Correspondingly, earnings per share for FY2023 fell to 6.4 cents from 35.4 cents in FY2022.

For the full-year period, revenue was down 33% y-o-y to US$58.0 million with charter income falling 42% y-o-y to $37.8 million.

However, while the charter market for dry bulk softened in 2023, the group notes that dry bulk second-hand prices remained strong. This was due to newbuilding prices having risen over the past year driven by strong shipyard capacity utilisation from high levels of containership and gas carrier ordering over the past two years.

The group says it has capitalised on favourable second-hand market prices for dry bulk vessels, strategically divesting its older vessels, to recycle capital and strengthen its financial position.

For instance, the disposal of Uni Auc One, built in 2007, resulted in a realised gain of US$2.3 million in November 2023. In early 2024, the group also finalised an agreement to sell its second-oldest vessel Uni Wealth, which was built in 2009. The transaction is expected to conclude in March 2024 and result in a reversal of previously recognised impairment losses of property, plant and equipment of US$1.2 million made in 2023.

Besides shipping, Uni-Asia's other key business is in real estate. It owns stakes in a string of Hong Kong commercial development projects, as well as a portfolio of boutique projects estates in Japan.

The group notes that the Japan property market remains robust, although the profit contribution in US Dollar (USD) terms is affected partially by the weaker Japanese Yen (JPY). Meanwhile, the Hong Kong property market remains slow and the group recognised a fair valuation loss of US$2.1 million for its Hong Kong property investments.

Uni-Asia has declared a final dividend of 2.2 cents for FY2023. Together with the interim dividend of 2.2 cents per paid in September 2023, the group will pay a total dividend of 4.4 cents for FY2023.

The group expects FY2024 to be filled with geopolitical and climate-related uncertainties, which will have varying impacts on the shipping and dry bulk markets. It notes, however, that despite the uncertainty, second hand prices, especially for younger ships, are expected to stay strong in 2024 due to high newbuilding prices driven by strong shipyard utilisation.

Uni-Asia closed 1 cent lower or 1.18% down at 84 cents on Feb 29.

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