Ship and offshore engineering observation

The board of directors can pass 24 ships in one meeting, provided there is money in the account. The third quarter report shows that the operating income in the first three quarters was 25.243 billion yuan, a year-on-year increase of 47.03%, and the net profit attributable to the parent company was 7.389 billion yuan, an increase of 171.90%; the single-quarter attribution to the parent company was 2.844 billion yuan, a year-on-year increase of 235.04%, a month-on-month increase. 19.9%; net cash flow from operating activities was 10.368 billion yuan, an increase of 114.96%. (Source: Juchao Information, COSCO Shipping Energy 2026 Third Quarter Report)

But profits do not come from shipping volume. In the first three quarters, the tanker transport capacity was 5.70118 billion tons per day, a decrease of 14.3%, the transportation volume was 124.67 million tons, a decrease of 10.2%, and the turnover was 420.4 billion tons nautical miles, a decrease of 14.9%. During the same period, the oil tanker segment revenue was 22.324 billion yuan, an increase of 51.5%, and the cost was 13.185 billion yuan. billion yuan, an increase of only 10.5%, and gross profit was 9.139 billion yuan. The increase almost entirely fell on the price difference.

Freight caliber: From January to September, the average TCE of TD15 (West Africa-China) is about 153 thousand US dollars/day, a year-on-year increase of about 250%; TD22 (US Gulf-China) is 138 thousand US dollars/day, an increase of 224%; in the third quarter, the average TCE of TD34 (Oman-China) is about 320 thousand US dollars/day, rising from 200 thousand US dollars/day to 800 US dollars/day in September thousand US dollars/day. The company attributes this to the resonance of transportation demand, geo-risk premium, efficiency loss of deviations and ship-to-ship transfers. (Source: Juchao Information, COSCO Shipping Energy 2026 Third Quarter Report)

To add to the structure: foreign trade oil transportation gross profit is 8.083 billion yuan, and domestic trade is 1.056 billion yuan. The following is an inference: when freight prices fall, the impact first falls on the profit statement, not on transportation volume.

The beneficiary is the Chinese shipyard. All 10 new ships are owned by COSCO Shipping Heavy Industry, 6 by Yangzhou Heavy Industry, and 4 by DSIC. The two investments are 5.743 billion yuan and 3.829 billion yuan respectively. Yangzhou Heavy Industry is a wholly-owned subsidiary of COSCO Shipping Heavy Industry, so it constitutes a related transaction; DSIC is wholly owned by China Shipbuilding Industry Co., Ltd. (Source: Juchao Information, COSCO SHIPPING Energy Announcement 2026-075, 2026-076)

The next six financial leasing companies: The 20-year fixed rent ceiling is 5.2 billion yuan for Bank of Communications, 3.9 billion yuan for ICBC, 3.3 billion yuan for Agricultural Bank of China, 1.1 billion yuan for Bank of China, 2.6 billion yuan for CITIC, and 1.3 billion yuan for Minsheng, totaling 17.4 billion yuan. What gold leasing buys is a 20-year fixed cash flow, and what the lessee buys is a balance sheet expansion path that does not occupy one-time funds. (Source: Juchao Information, COSCO SHIPPING Energy Announcement 2026-077)

The party under pressure are other VLCC shipowners for delivery in the same window of 2029-2030: 24 ships are under pressure in these two years, but the decision-making occurred at a time when freight rates were high. The first to be injured were shipowners who did not lock in long-term contracts and could only run spot contracts.

For COSCO SHIPPING Energy itself, the risk is not on the asset side but on the cost side. The 14 ships are fixed rents with a maximum lease period of 20 years, and the income side is the spot freight rate. The following is an inference: rent is rigid, freight rate is not rigid, and this mismatch will be concentrated in the years when freight rates are down, not in the year of delivery.

The bare-lease part states that "it can effectively reduce comprehensive financial costs and one-time capital investment." This judgment is true; but the 17.4 billion yuan disclosed in the same document is the upper limit of rent for 20 years. Based on 17.4 billion yuan, 14 ships, and 20 years, the average annual rent of a single ship is about 62.14 million yuan (estimated value). To build 10 self-built ships is 9.572 billion yuan in capital expenditure (57.43 + 38.29), bare-lease 14 ships is 20 years of operating expenses, the two cannot be added or directly divided - the announcement says "reduce one-time capital investment" instead of "reduce total cost", which is the trace left by the difference in caliber.

The second gap is in pricing. The announcement stated that Yangzhou Heavy Industry's "final ship price was lower than the quotation of other independent third-party shipyards", but did not disclose any third-party quotation value; the price of a single ship from related parties and non-related parties was the same as 948 million yuan. This "cheaper" was not supported by verifiable figures in the document.

The third caliber is easily overlooked: 10 of the 14 ships are LNG dual fuel, and the 10 self-built ships are LNG fuel READY or LNG/methanol dual fuel READY, which are reserved rather than installed. The single ship costs of the two types of ships are not directly comparable.

Direction: This is an operation to convert huge profits in freight rates into long-term transport capacity. The rhythm is earlier rather than later. The more likely path is 2027-2028. When freight rates are still high, no one questions this account. After centralized delivery in 2029, fixed rents become a re-priced subject. With a time scale of three years, the 2029 report is the first complete year in which the matching between rental pressure and utilization can be seen at the same time. Falsification signal: If 2027 When the freight rate is still high, the company continues to add bare-lease or order-to-order orders on the same scale, indicating that its judgment on the supply pattern in 2029-2030 is stronger than this inference; if it announces delayed delivery, resale or early cancellation of leases at that time, this inference will be supported.

1, 2026 Fourth Extraordinary Shareholders' Meeting: Related transactions of 6 ships and bare-lease of 14 ships require the approval of the shareholders' meeting, and related shareholders abstain from voting. This is the latest confirmed node.

Second, the "right-of-use assets" and "lease liabilities" reported in 2026. In the third quarterly report, the right-of-use assets have risen from 557,604,162.35 yuan at the beginning of the year to 2,538,613,848.02 yuan. This item will jump after the 14 ships are launched, which is a direct indicator of the degree of internalization of the balance sheet. (Source: Juchao Information, COSCO Shipping Energy 2026 Third quarter report)

3. Monthly data on VLCC new ship deliveries and new orders starting from 2027 are used to determine whether the supply from 2029 to 2030 is really concentrated.

This article is based on public information and does not constitute investment advice.