As the disclosure of third-quarter 2026 reports for A-share shipping companies draws to a close, Ningbo Ocean Shipping Co., Ltd. (ASX: 601022) released an announcement on the evening of October 29 revealing that in the first three quarters of this year, the company generated revenue of 5.177 billion yuan, up 14.81% year-on-year, while net profit attributable to shareholders fell 9.64% year-on-year to 482 million yuan.
Amid an industry upcycle marked by continuously rising freight rate indices and across-the-board profit growth among comparable peers, Ningbo Ocean Shipping, as the first domestic "A-to-A spin-off" shipping listed company, has delivered a report card that runs counter to the broader trend.
It is worth noting that through its IPO and a private placement completed earlier this year, Ningbo Ocean Shipping raised a combined total of over 2 billion yuan, almost entirely allocated to purchasing vessels and containers, while also aggressively expanding capacity through external leasing. Yet its gross margin has long lagged behind comparable companies.
In 2022, Ningbo Ocean Shipping achieved its listing through an "A-to-A spin-off" from Ningbo Port. At that time, issues such as related-party transactions and horizontal competition between Ningbo Ocean Shipping and its parent company Ningbo Port were widely questioned by regulators and the market, and to this day a substantial volume of related-party transactions still exists between the two.
In fact, the year of its listing also marked the peak of Ningbo Ocean Shipping's performance. Although revenue has continued to grow since then, profitability has fluctuated downward. Now, as the near-sea and domestic container shipping markets continue to recover, Ningbo Ocean Shipping's performance is still declining against the trend, and long-standing issues such as related-party transactions have once again drawn attention.
Industry Boom Lifts Peers While Net Profit Declines Against the Trend; 2 Billion Yuan Raised to Expand Capacity but Gross Margin Trails Peers Long-Term
The latest financial report shows that in the first three quarters of this year, Ningbo Ocean Shipping achieved operating revenue of 5.177 billion yuan, up 14.81% year-on-year, while net profit attributable to shareholders was 482 million yuan, down 9.64% year-on-year.
In the third quarter alone, the company's deceleration was even more pronounced, with quarterly revenue of 1.732 billion yuan, up 9.53% year-on-year, but quarterly net profit attributable to shareholders of 139 million yuan, down 10.51% year-on-year.
This performance stands in stark contrast to the overall prosperity of the current container shipping market and the results of peers. Since 2026, amid geopolitical disruptions, structural reshaping of global supply chains, and support from active regional trade, effective capacity supply in container shipping has tightened. Core freight rate benchmarks such as the Ningbo Export Container Freight Index (NCFI) and the China Export Container Freight Index (CCFI) have risen significantly year-on-year, and the shipping industry has broadly entered a profit-release period characterized by rising volumes and prices.
The third-quarter reports of comparable listed companies fully confirm the industry's strength. Among them, Jinjiang Shipping, Zhonggu Logistics, and COSCO Shipping Holdings recorded year-on-year net profit growth attributable to shareholders of 4%, 37%, and 13% respectively in the first three quarters, making Ningbo Ocean Shipping's nearly 10-percentage-point decline against the trend particularly conspicuous.
In reality, since its listing, Ningbo Ocean Shipping has persistently raised large sums to expand capacity. During its IPO, Ningbo Ocean Shipping raised net proceeds of 1.026 billion yuan, primarily directed toward container vessel acquisition, container purchases, and supplemental working capital. In August 2026, the company again raised net proceeds of 1.079 billion yuan through a private placement, used for the acquisition of four 2,700 TEU container vessels and supporting containers. The two rounds of equity financing totaled over 2 billion yuan in net proceeds, almost entirely directed toward capacity asset expansion.
Despite continuous "buy, buy, buy" capacity expansion through equity financing, this has not translated into matching profit growth. Ningbo Ocean Shipping's gross margin has long trailed peers, and the gap has recently been widening. The facts demonstrate that this over 2 billion yuan in capital investment has not only failed to generate equivalent profit momentum but has instead dragged down the company's performance and profitability under the combined squeeze of high depreciation, high charter costs, and high financial expenses.
Yet on the same day the third-quarter report was disclosed, Ningbo Ocean Shipping unveiled another major capacity expansion plan, proposing to charter four 7,000 TEU-class container vessels, two 14,000 TEU-class container vessels, and two 7,000 CEU-class ro-ro vessels through long-term leases, with lease terms not exceeding 20 years and total charter fees not exceeding 10.3 billion yuan.
Combined with the leasing plan for two 7,000 CEU ro-ro vessels announced in early October, the company has disclosed long-term leasing arrangements for a total of 10 large vessels within just one month, significantly escalating its fixed charter expenditure. Whether Ningbo Ocean Shipping's relentless heavy-asset expansion will ultimately reverse its performance or trigger a financial backlash remains a matter of intense market skepticism.
"A-to-A Spin-Off" Listing Was Widely Questioned; Related-Party Transaction Legacy Under Scrutiny Again
Ningbo Ocean Shipping's main business covers international and domestic coastal and Yangtze River shipping operations, ship agency services, and dry bulk freight forwarding, providing near-sea, transoceanic, domestic trade, and feeder container liner transportation services, with routes primarily along coastal and river areas.
In December 2022, Ningbo Ocean Shipping listed on the Shanghai Stock Exchange as a subsidiary of Ningbo Port, becoming the first "A-to-A spin-off" listing case in China's port industry.
Prior to listing, issues including horizontal competition between Ningbo Ocean Shipping and its parent company Ningbo Port, the fairness of related-party transactions, business independence, and the independence of capital and governance were widely questioned by regulators and the market.
It is understood that Ningbo Ocean Shipping's core positioning has been deeply bound to the parent port system since its inception. Using Ningbo Zhoushan Port as its hub, it undertakes feeder services in the "trunk-feeder combination" model, river-sea intermodal transport, and near-sea short-haul shipping. This "parent port appendage" route structure means its shipping cargo sources are largely constrained by the parent port's transshipment flows, lacking strong bargaining power with end shippers and the ability to launch transoceanic high-freight-rate routes.
In the industrial chain's profit distribution landscape, the company is more akin to a "maritime porter" earning meager passage fees, unable to share in the high profits of the shipping super-cycle.
Related-party transactions between the two have also persisted to this day. According to its 2025 annual report, among the company's top five suppliers, related-party procurement amounted to 1.167 billion yuan, accounting for 22.77% of total procurement for the period, primarily covering port loading and unloading, port services, ship agency, and fuel supply within the Ningbo Zhoushan Port system. In addition, sales revenue to related parties reached 275 million yuan, accounting for 4.51% of operating revenue.
In fact, the year of its listing also marked the peak of Ningbo Ocean Shipping's performance. In 2022, Ningbo Ocean Shipping achieved revenue of 4.769 billion yuan and net profit attributable to shareholders of 670 million yuan. Although revenue has continued to grow since then, profitability has fluctuated downward.
Now, as the near-sea and domestic container shipping markets continue to recover, Ningbo Ocean Shipping's performance continues to decline against the trend. The divergence between its heavy capital investment and profitability, as well as the inextricably tangled related-party transactions with its parent company Ningbo Port, have once again surfaced.
Comments