Ship market: Behind the step back or welcome new opportunities
According to the latest report released by the China Shipbuilding Industry Economic Research Center, as of the end of last year, the number of active shipbuilding enterprises in China was 130, down 14% from 151 in 2012. Combined with the volume of orders and market development of various shipbuilding companies, this year The number of active shipbuilding companies will be further reduced.
A global shipbuilding bitter year
2016 is a difficult year for the global shipbuilding industry. However, the positive is that the company has already enjoyed the results of macroeconomic regulation and control - this result will be long-term.
At the end of last year, this Clarkson new ship price index fell to 123 points, which is even lower than the historical low of 126 points after the global financial crisis in 2008. As for the volume of new ships in the world last year, it is also bleak. The number of ships sold in the year was only 539 ships, 27.418 million DWT, and the transaction load-to-weight tons fell sharply by 75.7% year-on-year, the lowest value in nearly 20 years. Last year, China, South Korea and Japan's three major shipbuilding countries received orders of 16.17 million DWT, 5.84 million DWT and 4.1 million DWT respectively, down 51%, 89% and 83% respectively; the hand-held orders were 95.947 million DWT and 50.28 million DWT respectively. And 59.192 million DWT. In addition, as of the end of last year, the global hand-held orders decreased by 26.3% year-on-year. From the perspective of hand-held orders, after the three major shipbuilding companies in Korea were in crisis, the Japanese shipbuilding industry was approaching or even occupying the position of the world's “second child”.
It seems that the global shipbuilding industry will have a thorough “bottoming rebound”. However, Clarkson’s March revision revised the outlook data of the global shipbuilding market including this year – the overall downward adjustment is the main one, and the maximum reduction is even more than two. to make. That is to say, in the case that both volume and price are at a low level, the shipbuilding industry needs to find a reliable path other than “optimistic expectations” to recover. What the industry can see is that the Chinese ship market last year really put the core issue of “de-capacity” into practice. Take the two “active” shipbuilding enterprises in Taizhou, Jiangsu Province as an example. Due to the large gap between scale and ordering capacity, the ships delivered last year were more than 20 ships and 8 ships, which are roughly statistics. If this year’s activity declines last year Half, then the ship's delivery volume fluctuations will be around 70.
B “North-South ship” is generally stable
China's shipbuilding industry has undergone major changes in the past two years, and this is not difficult to see from the performance of related listed companies.
In 2016, China Heavy Industry achieved operating revenue of 52.064 billion yuan (completed 24.094 billion yuan in the first half of the year), down 12.95% year-on-year; realized net profit attributable to owners of the parent company of 698 million yuan - successfully achieving annual turnaround. In the first half of last year, the revenue decreased by 12.05% year-on-year, and the net profit of the mother returned to 741 million yuan. It can be seen that China Heavy Industry has maintained a high main gross profit margin in the case of overall revenue decline. The proportion of military products with higher interest rates to operating income has also increased, which has ensured the stability of the main gross profit margin. From the third quarter of last year to the end of last year, there were institutions that were optimistic about the overall recovery of the global shipping industry. The Baltic Dry Freight Index also ushered in a benign situation of rapid rebound after the Spring Festival, while the Shanghai Export Container Freight Index was At the end of March, it rose 9.4% to 830.02 points. Different levels of shipping index seems to support the overall recovery of the shipping industry in 2017. However, based on the subtle relationship between transportation capacity and freight rate, the prosperity of the shipping industry and the shipbuilding industry is not strongly related. The latter is still self-reinforcing when the capacity is still surplus.
On the books, Chinese ships have seen the most bitter days in 2016. Last year, China Ships achieved operating income of 21.457 billion yuan, a year-on-year decrease of 22.72%, and the profit level was a huge loss. The net profit attributable to owners of the parent company was -2.607 billion yuan, a year-on-year decline of 4314.78%. . It should be noted that the operating income of China's marine engineering business in 2016 was -1.665 billion yuan. This part of the revenue was mainly due to the termination of the contract for two jack-up rigs and four PSVs. The confirmed revenue was 1.971 billion yuan and the cost was 1.964 billion yuan. This year, due to the poor market conditions of the offshore industry, the volume of transactions and the amount of platforms that can ultimately be delivered are all problems, which results in the current handheld drilling platform. The difficulty of delivering the original contract price increased, which affected the estimated total revenue of the rig's contract. In recent years, the South Shipbuilding System has been said to have fallen a bit in the offshore market. However, it seems that the situation will not be worse. Last but not least, the gross profit margin of China Ship’s main business last year was 17.83%, a year-on-year increase of 9.46%, which was the highest among the three listed companies listed in Table 1.
The CSSC, which belongs to the South Shipbuilding Department, achieved operating income of 23.35 billion yuan last year, down 8.50% year-on-year. The net profit attributable to shareholders of listed companies was 0.71 billion yuan, down 27.56% year-on-year. Behind the “year-on-year double decline”, the total amount of orders received during the year reached 22 billion yuan, which was basically the same as the same period of the previous year – providing basic guarantee for the medium-term development of the company.
C transformation into a new vitality for enterprises
At the supply end of the shipbuilding industry, China Shipbuilding Technology and Yaxing Anchor Chain were selected for analysis.
The main business of CSSC, which has been transformed from the steel structure project, has undergone major changes. The original ship accessory business, complete machinery and equipment business and large steel structure business will gradually shrink with the disposal of some assets of Changxing Island. Therefore, the significance of discussion as a supply side of the shipbuilding industry lies more in the process of its transformation. At present, CSIC 9 has become a wholly-owned subsidiary of CSSC. Its new business includes design consulting, general contracting and other services. The industries that can be served include ships, equipment, environmental protection, waterworks and construction. CSSC achieved operating revenue of 5.304 billion yuan last year, up 1.44% year-on-year; net profit attributable to shareholders of listed companies was -43 million yuan, down 143.49% year-on-year - mainly due to the following: First, sales in 2015 Subsidiary Haojiang Industrial confirmed the investment income, so the investment income last year decreased sharply; the second is the increase in employee placement repatriation benefits during the disposal of some assets of Changxing Island; the third is the loss of the subsidiary company due to the downturn in the shipping market. . Through the example of CSIC, it can be clearly felt that the speed and intensity of enterprise transformation have been significantly improved. However, due to factors such as market conditions, the dividends brought by the transformation are far from the extent of being able to attract investors and investors.
Yaxing Anchor Chain, the world's largest anchor chain manufacturer, is another company that suffered a “year-on-year decline” last year. The annual operating income was 1.022 billion yuan, down 31.83% year-on-year; the net profit attributable to shareholders of listed companies was 0.54 billion yuan, down 69.56% year-on-year. In 2015, Yaxing Anchor Chain received the treasury amount of 285 million yuan from Guolian Trust Co., Ltd., which offset the bad debt provision of 83.374 million yuan for the previous year. However, in 2016, there was no such income, resulting in a sharp drop in net profit.
From the analysis of the annual reports of the above five listed companies, it can be reflected that the current Chinese manufacturing industry is facing a dilemma of overallity. However, “it is difficult to change without being trapped”, and the transformation is injecting new vitality into the enterprise. From this perspective, we may wish to pay more attention to the structural adjustment of some industries beyond the topic of “the merger of “North and South Ships” – similar means will be more practical and effective than the blind and chaotic merger.
Will the new shipbuilding market recover next year? Clarkson said that he still has to wait for a year.
In March, Clarkson revised the outlook for the global shipbuilding market for the next four years – the total is generally down. This is not good news for the three major shipbuilding countries in China, Japan and Korea.
It is predicted that the South Korean government will sell debt-ridden Daewoo shipbuilding next year, and it seems that this possibility is growing. A number of shipbuilding market research reports show that the global shipbuilding market is unlikely to recover significantly next year – everything seems to be able to hope for a complete recovery in the shipping market in 2019. A senior ship broker said: "Everyone is expecting something to happen in 2019, but personally think that this expectation is still prudent. Even if the shipbuilding market in 2019 has a large increase, it is based on the increase in the following years. Above the big prejudgment."
In March, Clarkson revised the outlook for the global shipbuilding market for the next four years released in September last year. It is obvious that except for this year's new shipbuilding order data, which was fine-tuned by 4.4% to 21.4 million CGT from 20.5 million CGT, the rest The year is generally down. Among them, the downward adjustment will reach 13.2% next year - from 29.5 million CGT to 25.6 million CGT; in 2019, it will be lowered by 9.2% to 31.7 million CGT; in 2020, it will be lowered by 8.3% to 34.4 million CGT.
Shipbuilding market: recovery is not warm
The main changes after adjustment are from 2017-2018. According to the original radical forecast, the increase will reach 43.9% during this period. After the revision, it will be adjusted to 19.6%, and the reduction will exceed 20%. It can be said that if the final correction value is verified, then the data of last September can be said to introduce too many optimistic parameters.
As for 2021, Clarkson also gave the expected reduction of 1.1 million CGT, which is obviously lower than the expected range of 3.1 million to 3.9 million CGT from 2018 to 2020. In general, Clarksson's forecast data revision can be said to be a cold water for the “data optimist” in terms of a new shipbuilding order parameter. There are super-optimistic expectations in the market, such as "4000 points on BDI" and "a sharp recovery in the shipping industry in 2017". These forecasts are largely lacking in data support and blindly optimistic. The current situation of overcapacity in this year's capacity is still very obvious. Although the bulk market has recovered, the container market has brought back the freight rate by the compression of the space, but I am afraid I can't hope to return to the hot years of the past.
The global shipbuilding market is recovering in a less-than-expected, tepid form. However, due to the uncertain short-term recovery prospects of the LNG transportation market, the future of the Korean shipbuilding industry, especially the three major shipbuilding companies in South Korea, is really worrying.
Daewoo Shipbuilding: Next STX?
At present, the focus of shipbuilding enterprises is not Daewoo shipbuilding, and the Korean government cannot exchange blood for its unrestricted. In the case that Hyundai Heavy Industries completed the split and the reorganization of Samsung Heavy Industries was reduced, Daewoo Shipbuilding did not “go ashore”, indicating that it may face major equity restructuring. A recent example is the modern merchant ship taking the lead in “going ashore”. Hanjin Shipping "sinked."