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Hong Kong's Cosco International Holdings has said that its marine fuels business made a 'substantial contribution' to the company's surge in revenue in 2010.

The announcement was made as Cosco International posted a profit attributable to shareholders of HK$1,268.6 million (US$162.757 million) in 2010, an increase of HK$425 million, or 50 percent, on the previous year.

In a statement, Cosco International said: "The newly established trading and supply of marine fuel and related products business made a substantial revenue contribution to the group."

Segment revenue from shipping services increased significantly by 628 percent to HK$8,078.3 million profit before income tax.

The board of directors of the company proposed a final dividend of 3 HK cents per share and a special dividend of 35 HK cents per share. Together with the interim dividend of 2 HK cents per share, the total dividend for the year 2010 was 40 HK cents.

Echoing comments made last year regarding possible future acquisitions in the marine fuels sector, Zhang Fusheng, Chairman of COSCO International, said: "The group is dedicated to a steady growth of business and profitability. In addition, the group will capitalise on the strong financial position to speed up its study in seeking suitable internal and external projects of COSCO Group, including its discussion with COSCO Group in relation to the possible acquisition of supply of bunker oil and other businesses.

"Through business re-organisation and mergers and acquisitions, the group will expand its scope of core business of shipping services and further strengthen its core competitiveness, so as to become a large-scale, specialised and integrated shipping services provider, creating the best returns for all shareholders," Fusheng added.

On the economic outlook Cosco International said: "China is one of the key drivers for the global economy and 2011 is the first year for the implementation of the "Twelfth Five-year Plan". China's economy is expected grow stable and solid with the implementation of the macroeconomic policies that highlight "structure adjustment, growth continuation and inflation containment". China's imports and exports are expected to grow steadily. The world shipping market is expected to remain positive in 2011 while shipping companies will develop in a volatile market environment. For the shipbuilding industry, the global new builds order book is still large. Contracts on new builds are expected to remain stable."

Cosco in the marine fuels sector

Singapore-based Sinfeng Marine Services Pte. Ltd. was established as a wholly owned subsidiary of Cosco International Holdings in November 2009. It is mainly engaged in the provision of marine fuel and related services including marine bunker supplies, trading of oil and oil related products and brokering services for clients.

Double Rich Ltd, a Hong Kong-based bunker oil trading and supply company, is 82 percent owned by Chimbusco and 18 percent owned by Cosco International.

Other Cosco-owned bunker companies include China Marine Bunker (PetroChina) Co., Ltd. (Chimbusco), a 50-50 joint venture between Cosco Group and oil giant PetroChina Company Limited. Chimbusco is China's largest physical supplier of marine fuel by volume. Towards the end of last year the company was reported to be interested in setting up a physical supply operation in the world's largest bunker port, Singapore.