Courage Investment Group Limited: 2025 Interim Financial Review and Analysis

Courage Investment Group Limited reported its interim results for the six months ended 30 June 2025, revealing the impacts of a challenging macroeconomic environment, with significant pressure on its marine transportation segment and an initial foray into coal trading. This article breaks down the key financial metrics, management’s outlook, exceptional items, and provides actionable recommendations for investors.

Key Financial Metrics and Comparative Analysis

*Not a quarterly value, but the year-end retained profit as disclosed.

Business & Financial Highlights

• Revenue: Dropped 14% YoY to \$4.38M, mainly due to a 34.1% drop in Supramax dry bulk charter rates, which severely pressured the marine transportation segment. Trading (coal) contributed \$551k, a new revenue stream for the group.
• Net Loss: The group swung to a net loss of \$1.71M, compared to a \$1.28M profit in the previous period, reflecting industry headwinds and additional dry-docking costs.
• EPS: Fell to -0.16 US cent (HY2024: +0.12 US cent).
• Dividend: No interim dividend was declared for the period, consistent with the prior period.
• Liquidity: Liquid assets (bank deposits and cash) fell from \$18.94M to \$13.91M, but the current ratio remains strong at 8.1x, despite a notable decrease from 19.6x due to increased current liabilities from dry-docking provisions.
• Trading Segment: The group began coal trading, selling 5,200 tons and recording \$13k in profit for this segment. No trading revenue was reported in the previous period.
• Asset Base: The fleet consists of three Supramax bulkers (171,000 dwt), and the group invested \$1.86M in property, plant, and equipment during the half year.
• Expenses: Employee benefits (including directors) rose to \$666k (HY2024: \$417k), and crew expenses increased to \$1.46M (HY2024: \$961k), reflecting higher operational and personnel costs.

Management Outlook & Chairman’s Statement

“As the trade war has gradually been softening and Sino-US tariff negotiations has been progressing, the Group’s management remains cautiously optimistic about the medium- to long-term prospects of its marine transportation businesses. Since June 2025, BSI 58 has rebounded strongly. Given the demand in commodities has gradually gaining momentum, the Red Sea crisis has remained lingering and the global marine transportation bulkers supplies have yet to be effectively alleviated, the Group expects demands on bulkers remain strong in the near term. The Group has been continuously leveraging on the extensive and diverse business resources of its new controlling shareholder, business partners, and other stakeholders to expand its logistics and trading businesses in mainland China, Mongolia, and other Belt and Road countries, striving to cultivate new growth drivers and achieve business diversification. Looking ahead, the Board maintains its prudent business philosophy in seizing opportunities to expand its fleet, levelling up its professionalism in fleet management, implementing refined cost-cutting and efficiency-enhancing measures, and exploring investment and merger and acquisition opportunities, aiming to deliver long-term growth to the shareholders of the Company.”

The tone is cautiously optimistic, recognizing recent improvements in the market but remaining prudent about cost control and diversification.

Exceptional Items & Noteworthy Events

• Exceptional Items: No significant impairment loss on vessels in HY2025 (HY2024: \$299k impairment).
• Related Party Transactions: \$69k acquisition of property, plant, and equipment from a related company controlled by key management. All related-party transactions were deemed de-minimis and exempt from further reporting.
• Shareholding Change: Following the voluntary conditional general cash offer completed in February 2025, China Mark Limited (wholly owned by Chairlady Ms. Liu Sainan) now owns 51.81% of the company.
• No significant contingent liabilities or capital commitments as of 30 June 2025.
• No share option grants or share buybacks during the period.

Remuneration and Board Information

Total remuneration for key management personnel (directors and chief executives) was \$362k for HY2025, up from \$210k in HY2024.

Historical Performance and Trends

• The group’s results are highly cyclical and sensitive to dry bulk market conditions.
• HY2025’s loss follows a profitable HY2024, reversing previous positive trends due to market and geopolitical headwinds.
• Cost increases (staff, crew, dry-docking) outpaced revenues, while interest income dropped 53% due to lower bank rates.

Outlook and Forecasted Events

• Management expects a continued rebound in the dry bulk market, driven by commodity demand and lingering supply chain disruptions, but remains committed to diversification and cost management.
• No new legal, regulatory, or tax issues disclosed.
• No new fundraising, IPOs, or asset sales announced.

Conclusion & Investor Recommendations

Overall Assessment: Courage Investment Group Limited’s interim results reflect a weak financial performance for the first half of 2025, with significant losses stemming from depressed bulk shipping rates, increased costs, and only modest contributions from the newly launched coal trading business. Liquidity remains robust, and the company’s strong balance sheet provides resilience, but the near-term outlook depends on a sustained recovery in shipping markets and successful diversification.

Recommendations

• If you are currently holding the stock:
  • Exercise caution and monitor developments closely. The company retains a strong liquidity position and is showing early signs of business diversification, but the outlook depends on sustained market recovery and execution of diversification strategies. Consider holding if you believe in a shipping market rebound and management’s ability to deliver on new initiatives, but reassess if losses persist or if the market deteriorates further.
• If you are not currently holding the stock:
  • Consider waiting for clearer evidence of a turnaround in the company’s core segments and improved profitability before initiating a position. The entry of new trading activities is promising but currently too small to offset core losses. Watch for a sustained recovery in shipping rates, improved margins, or successful expansion in trading/logistics before buying.

Disclaimer: This analysis is based solely on the information disclosed in the 2025 interim report of Courage Investment Group Limited. It does not constitute investment advice, and investors should conduct their own due diligence and consider their risk profile before making any investment decisions.

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