Strong performance surge! What is Zhongyuan Haite's secret?

Remember the company, focus on core features.

Author | Xian Yan

Editor | Xiao Bai

When it comes to China COSCO Holdings (600428.SH), the three labels that come to mind for Fengyun Jun are: offshore wind power, automotive and large equipment exports, and pulp.

One is on the sea, one is sent out, and one is brought back.

Especially the last one, which is to address the situation of capacity waste and returning empty, hence the gross profit margin is much lower.

(Source: 2025 Annual Report)

Based on the high prosperity of the first two industries, the company’s performance is also not bad.

Recently, the company released its 2025 annual report, with total revenue of 23.2 billion, a year-on-year increase of 38%, and net profit attributable to shareholders of 1.75 billion, a year-on-year increase of 35%. Operating cash flow has never been a weakness for the company, easily cutting down 6.3 billion, a year-on-year increase of 75%.

The company’s ROE after deducting non-recurring items has also seen two consecutive increases, from 6.8% in 2023 to 10.8% in 2024 and then to 11.2% in 2025.

To analyze the operating characteristics behind this, let’s first look at the company’s changes in its core assets: the deadweight tonnage increased from 6.14 million tons in 2025 to 9.12 million tons, an increase of nearly 50%.

(Source: 2025 Annual Report)

Compared to the 2024 data, the size of the company’s own fleet changed little, but the scale of operating leases nearly doubled, increasing from 49 ships to 97 ships, corresponding deadweight tonnage also doubled from 3 million tons to 6 million tons.

Specifically:

The number of heavy lift ship leases increased from 6 to 15;

The original pulp ships were replaced by new multi-purpose vessels, with the leasing scale increasing from 36 ships to 64 ships;

The scale of car carrier leases increased from 7 ships to 18 ships.

(Source: 2024 Annual Report)

Multi-purpose vessels and heavy lift vessel business: New access to 9 heavy lift vessels, focusing on high-value cargo such as wind power equipment, advanced manufacturing, and commodity cars, signing COA transportation agreements with multiple leading industry clients (Note: Contract of Affreightment, a long-term agreement), enhancing both market share and customer stickiness.

Among them, the volume of machinery equipment transportation increased by 76% year-on-year, wind power equipment cargo volume increased by 55% year-on-year, and energy storage cabinet transportation volume increased by 400%, while engineering equipment and port machinery transportation volumes increased by 73% and 150% year-on-year, respectively.

New multi-purpose vessel business: New access to 28 new multi-purpose vessels, becoming the main force in ensuring the supply chain of imported pulp in China, with pulp transportation volume increasing by 45% year-on-year.

Do you remember Qian Kaigang? The company launched direct fast shipping routes from South America West and East BRICS weekly services, filling the gap in fast shipping services in the region, providing timely departure and delivery services for advanced manufacturing products such as passenger cars and engineering vehicles.

Semi-submersible vessel business: Serving global oil and gas, new energy, EPC companies, and other clients, deeply cultivating the high-end marine engineering market, completing multiple large offshore wind power projects, and the installation of floating liquefied natural gas facilities in gas fields. Ordering new semi-submersible vessel orders for 70,000 tons to consolidate its leading position in the floating installation field.

Car carrier business: Newly accessed 13 LNG dual-fuel car carriers, with a globalized route network covering 6 international routes in key global markets, including the Persian Gulf, Southeast Africa, Europe, South America West, the Mediterranean, and Australia.

Other business changes are minor.

However, these businesses are by no means independent; for example, the company provides direct shipping services for Chinese cars “at the doorstep,” which requires a combined transportation model of “car carrier roll-on/roll-off + heavy lift vessel + special frame matched with new multi-purpose vessels.”

At the core of this are the three business prosperity levels mentioned by Fengyun Jun at the beginning, corresponding to revenue:

Heavy lift fleet revenue of 3.2 billion, a year-on-year increase of 44%;

New multi-purpose vessel revenue of 6 billion, a year-on-year increase of 35%;

Car carrier fleet revenue reached 4.4 billion, a year-on-year increase of 214%.

The semi-submersible fleet is also worth noting, with revenue of 2.9 billion, a year-on-year increase of 10%. The several rapidly growing businesses are accompanied by a certain degree of gross profit margin decline, but this business has a gross profit margin of 27%, a year-on-year increase of 8.3 percentage points.

That’s right, although downstream demand is clearly driven, the supply side of various businesses does not significantly lack capacity (except for semi-submersible vessels). While revenue is growing rapidly, the company’s overall gross profit margin has changed very little.

The company’s basic foundation: offshore operations represented by offshore wind power, exporting large machinery, engineering equipment, and new energy equipment (wind power equipment, energy storage cabinets), as well as exporting domestic new energy vehicles, plus pulp imports that currently contribute insignificantly but are considered a consumer trend indicator.

On this basis of understanding, from the perspective of long-term investors’ minimum return thinking, the lower limit of shareholder returns is the company’s dividends.

The company’s dividend payout ratio has maintained a high level of 50% over the past three years. If performance improves, shareholders will receive more; if it weakens, they will receive less.

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