China Aviation Oil Q3 net profit falls 48.7% to US$19.8 million amid energy supply-chain hitches - The Business Times

Revenue rises 18.2%, but weaker gross profit and higher expenses weigh on earnings

[SINGAPORE] China Aviation Oil (CAO) reported a 48.7 per cent year-on-year decline in net profit to US$19.8 million (S$25.4 million) for the third quarter ended Sep 30, from US$38.6 million a year earlier.

The weaker performance came amid disruptions to energy supply chains following an intensification of the Middle East conflict, which weighed on gross profit and drove up expenses.

Revenue rose 18.2 per cent to US$5.4 billion, from US$4.6 billion in the preceding year, the jet fuel supplier’s financial results released on Thursday (Nov 12) indicated. The group also declared a one-off special interim cash dividend of S$0.0372 a share to commemorate the 25th anniversary of its listing on the Singapore Exchange’s mainboard.

Gross profit for the quarter fell 76.1 per cent to US$6.5 million, from US$27.3 million, while administrative expenses nearly doubled to US$6.2 million.

However, contributions from CAO’s associates helped cushion the decline. Its share of associates’ results rose 34.5 per cent year on year to US$21.2 million in Q3, from US$15.8 million.

Earnings per share fell to US$0.0229 US cents, from US$0.0448 US cents the year before.

For the first nine months of 2026, CAO’s net profit declined 31 per cent year on year to US$61.2 million, from US$88.6 million. Revenue edged up 0.6 per cent to US$13.22 billion, from US$13.14 billion, mainly as a result of higher oil prices.

Nine-month gross profit plunged 80.2 per cent to US$11.4 million, while total expenses rose 65.5 per cent to US$21.5 million.

Meanwhile, its share of associates’ results surged 55.3 per cent to US$67.1 million, driven by higher contributions from Shanghai Pudong International Airport Aviation Fuel Supply Company (SPIA) and Oilhub Korea Yeosu.

SPIA’s contribution rose 56.4 per cent to US$63.8 million, supported by increased refuelling volumes that lifted revenue and profitability.

Nine-month earnings per share stood at US$0.0707 US cents, compared with US$0.1029 US cents in the year before.

Despite the challenging operating environment, CAO remains cautiously optimistic about its prospects, citing resilient demand in its core China market and the continued recovery of international air travel. The group noted that China’s international air passenger traffic rose 4.7 per cent year on year to 61.95 million passengers in the first nine months of 2026.

Chief executive Lin Yi noted that CAO has managed to stabilise operations and minimise the impact of supply-chain disruptions through its diversified international operations.

The group plans to expand its jet fuel trading and supply network, strengthen its sustainable aviation fuel capabilities and pursue investments in strategic oil-related assets.

As at Sep 30, CAO held cash and cash equivalents of US$513.9 million, down from US$687 million at end-December 2025. Its net asset value per share rose to US$1.3002, from US$1.2528 at the end of 2025.

Decoding Asia newsletter: your guide to navigating Asia in a new global order. Sign up here to get Decoding Asia newsletter. Delivered to your inbox. Free.

Higher rates, weaker spending: Is the Philippines entering stagflation?

Special dividend for SIA’s 80th anniversary? CEO says extra payout will need board’s nod

Genting Singapore Q3 net profit falls 42.2% to S$54.7 million on softer premium gaming