SINGAPORE - Yangzijiang Financial Holding reported net profit of $25.6 million for the second half of financial year 2022, down 80 per cent from $130.7 million in the same period of the previous year.
The recently spun-off financial unit of Yangzijiang Shipbuilding on Wednesday posted a loss after allowances of $17.1 million, as opposed to profit after allowances of $111.9 million in the second half of financial year 2021.
This came as a $135.9 million allowance for credit losses was recorded during the period under review, due to additional allowances made for non-performing debt investments and microfinance loans.
The company recorded $44 million in share of results of associated firms and other gains.
Total income for the half year declined 9 per cent year on year to $132.4 million from $145.7 million, mainly due to lower interest income and dividend income.
Interest income – the main income generator for the group – was down 17 per cent from 2021, because of lower contributions from the debt investment business. Average debt investment balance declined, while non-performing loans grew over the second half of the year. The group’s loss from non-interest income, however, narrowed to $15.5 million from a loss of $32.4 million in the second half of financial year 2021, as a result of lower fair value changes on financial assets.
Yangzijiang Financial’s earnings for financial year 2022 were $162 million, 50 per cent lower than financial year 2021’s net profit of $327.2 million.
Earnings per share (EPS) stood at 4.22 cents, against financial year 2021’s 8.28 cents.
The board declared a first and final dividend of 1.8 cents for financial year 2022, a payout ratio of 43 per cent.
Yangzijiang Financial executive chairman Ren Yuanlin said he remains cautiously optimistic of the group’s prospects for 2023 with the reopening of China’s borders, coupled with Beijing’s support measures for the domestic property sector.
He deemed 2022 a challenging year for Yangzijiang Financial, as it focused on diversifying its portfolio across vintages, asset classes and geographies.
“The group’s performance was also hit by the adverse impact of the Covid-19 pandemic on the Chinese economy. Nonetheless, we were able to remain profitable through the year,” Mr Ren added.
Separately, Yangzijiang Financial announced it will invest up to US$23.7 million (S$31.8 million) in two medium-range tankers, through its maritime fund’s partnership with “an international leading manager”.
The eco-design vessels are scheduled for delivery in the first half of 2025. They will feature hydroelectric cargo pumps from system supplier Framo, which the group considers to be operationally more efficient than traditional electric cargo pumps.
Shares of mainboard-listed Yangzijiang Financial closed 4.3 per cent up at 36.5 cents on Wednesday. THE BUSINESS TIMES
