US foothold 'final stage of Brightoil plan'

PUBLISHED : Wednesday, 29 September, 2010, 12:00am
UPDATED : Wednesday, 29 September, 2010, 12:00am

Brightoil Petroleum, which delivers fuel oil to ships, plans to expand its bunkering service to the American port of Houston, in Texas, to complete its global service network.

The company, which reported that net profit grew more than 300 per cent for the year ended June, said that gaining a foothold in the US was 'the final stage' in its business strategy. It said that extending its networks in the mainland and in the global market could improve net profit margins in the long term.

Brightoil Petroleum said it had begun operations in the Malaysian port of Tanjung Pelepas in July and would launch operations in Dalian and Tianjin in northern China.

The company's net profit was HK$1.14 billion to June 30 - up from last year's HK$263.35 million. Revenue increased 150 per cent to HK$13.63 billion.

Brightoil Petroleum's robust earnings growth in the period came mostly from a surge in bunker sales. It also partly reflected a rise in the fair value of its futures contracts for hedging oil prices, which rose to HK$355.4 million from HK$56.8 million in the year-earlier period.

The Shenzhen-based company did not disclose its net profit margin yesterday, but said in July that, for the second half of 2009, it was nine times higher than that of China Marine Bunker (PetroChina), which is the biggest oil operator in the sector in the mainland.

Brightoil reported a 9 per cent net profit margin for the second half of 2009, excluding hedging gains and non-recurring items.

This compares with the 0.9 per cent net margin in 2008 posted by China Marine Bunker (PetroChina), a joint venture between the nation's largest oil producer, PetroChina, and the largest shipping company, Cosco Group.

Chairman Sit Kwong-lam attributed the higher margin to the experienced trading team at its parent, Shenzhen Brightoil, the source of its fuel. Sit owns Shenzhen Brightoil.

Meanwhile a company spokesman said Shenzhen Brightoil gave the company a 3 per cent discount on fuel compared with the Singapore benchmark.

A final dividend of 3 HK cents per share will be distributed. Last year there was no final dividend.

Shares of the company closed 0.97 per cent higher yesterday at HK$3.14 after surging as much as 4 per cent in the afternoon. Brightoil Petroleum's share price has soared almost sixfold in the past year.

Texas bound

Shenzhen company aims to expand its reach to the US port of Houston

The net profit of Brightoil Petroleum during the past year, which ended on June 30, grew by this amount: 300%

The company's revenue, in HK dollars, increased by 150 per cent during the past 12 months to reach: $13.6b


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