China Aviation Oil (Singapore) Corporation Ltd on Friday reported a net profit of 21.8 million U. S. dollars in the third quarter of 2013, up 65 percent from that of the same period last year.
The largest physical jet fuel trader in the Asia Pacific region said the surge in net profit was mainly attributable to higher contribution from its key associated company Shanghai Pudong International Airport Aviation Fuel Supply Company thanks to a one- off credit from the provision of past claims relating to customs duties and value added tax.
The supply and trading of jet fuel and trading of other oil products contributed gross profit of 7.1 million U.S. dollars.
The group's strategy to diversify its products to include trading of other oil products since 2008 is yielding results, as is "evident from the strong performance of other oil products which buoyed the group's profitability" in the first nine months, said Meng Fanqiu, chief executive officer of the company.
The company's jet fuel supply and trading volume in the first nine months of the year remained largely unchanged at 7.85 million tons.
Shanghai Pudong International Airport Aviation Fuel Supply Company contributed 36.6 million U.S. dollars of profit to the group in the first nine months, up 39.3 percent, thanks to a one- off credit resulting from the provision of past claims relating to customs duties and value added tax amounting to 11.9 million U.S. dollars.
The increased contribution from associates is slightly offset by higher losses recorded for Oilhub Korea Yeosu of 1.3 million U. S. dollars in the first nine months of the year, which is in comparison to the loss of 0.2 million U.S. dollars in the first nine months of 2012. The higher loss was mainly due to the recognition of mark-to-market loss from its foreign currency swap contracts denominated in the won against the U.S. dollar.
The company said it is sticking to the long-term goal of becoming a global transportation fuels provider by 2020.