China Aviation Oil (Singapore) reported on Wednesday that its second-quarter net profit rose 14.4 percent on-year to US$29.3 million as oil prices were higher.
Revenue for the quarter rose nearly 58 percent on-year to US$5.80 billion, with revenue from middle distillates up 24.46 percent on-year at US$3.118 billion and revenue from other oil products up 129.68 percent on-year at US$2.682 billion, CAO said in a filing to SGX on Wednesday. That was primarily due to higher oil prices and an increase in volume, it said.
The largest physical jet fuel trader in the Asia Pacific region reported that in the first half, its net profit rose 14.15 percent on-year to US$56.205 million as revenue increased 41.79 percent on-year to US$9.902 billion on higher oil prices and a 12.13 percent growth in total supply and trading volume to 17.56 million tonnes.
For the first half, profit contributions from associated companies rose 19.18 percent to US$39.57 million as share of profits from associate – Shanghai Pudong International Airport Aviation Fuel Supply Co., or SPIA, rose 19.05 percent on-year to US$34.57 million, mainly due to higher refuelling volumes, it said.
In its outlook statement, CAO pointed to recent volatility in oil as U.S. pressure on OPEC temporarily weighed on crude prices.
“However, prices quickly rebounded as market players perceived the U.S. intervention to be a sign that the oil markets remain undersupplied. The volatility in oil prices is further exacerbated by geopolitical tensions and global economic uncertainties as U.S. sanctions and trade spats persist into the second half of 2018,” it said.
But CAO added it would continue to build on the stable jet fuel supply business and to leverage on the growth in China’s civil aviation industry as well as expand its aviation marketing business outside of mainland China.
“As the group continues to expand its global jet fuel supply and trading network complemented with trading in other oil products, CAO will continue to seek opportunities for expansion through investments in synergetic and strategic oil related assets and businesses,” it said.