By Kao Shih-ching / Journalist
Yang Ming Marine Transport Corp (陽明 海運) will use NT $ 16 billion (US $ 570.4 million) of its NT $ 29 billion in newly raised capital to bring its debt-to-asset ratio below 60%, a- he announced yesterday.
The assets and liabilities of the container shipping company stood at NT $ 208.85 billion and NT $ 146.4 billion respectively at the end of March, indicating a debt-to-asset ratio of 70%, according to the reports. company data.
Its main rivals had lower debt ratios. As of March 31, Evergreen Marine Corp (運 海運) had a debt to asset ratio of 61.6%, while Wan Hai Lines Ltd (萬 海 航運) had an even lower ratio of 57.4%.
Photo courtesy of Yang Ming Marine Transport Corp
After paying off debts, Yang Ming’s relationship with banks is expected to improve, President Cheng Chen-mount (鄭 貞 茂) said at an online investor conference in Taipei.
“Our goal is to reduce the debt-to-asset ratio to less than 60%,” Yang Ming spokesperson Ho Hsiu-chi (何 秀 綺) said by phone.
Yang Ming plans to use the remaining NT $ 13 billion for overhead and new ships, but Ho said the company has not decided what type of ships it will buy.
Cheng said the company is still studying the plan, adding that the best deal will maintain its position in the market without harming its financial strength.
Yang Ming owns 88 vessels with a combined capacity of 623,124 twenty-foot equivalent units (TEUs), which ranks it ninth among global container shippers with a 2.5% market share, said the chairman of the company, Patrick Tu (杜書勤).
The company has contracted CSBC Corp Taiwan (台灣 國際 造船) to build 10 ships of 2,800 TEU each in 2018 and has received nine ships since last year, Tu said, adding that it would receive the last one by now. the end of the year.
The company will also receive 11 new chartered vessels with a capacity of 11,000 TEU each by the end of next year, Tu said, adding that the new vessels would help Yang Ming meet the high freight demand.
Regarding US President Joe Biden’s executive order that encourages competition in the shipping industry, Tu said it will not affect freight rates because Washington is primarily targeting anti-competitive behavior.
Ocean shippers have not discussed shipping rates for a long time, while the problem of port congestion remains as demand still far exceeds supply, he said.
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