China Aviation Oil (Singapore) Corporation Ltd (CAO) 1H2025 Financial Analysis

China Aviation Oil (Singapore) Corporation Ltd (CAO), the largest physical jet fuel buyer in the Asia Pacific region, reported a robust set of results for the first half of 2025. The company demonstrated strong growth in revenue, profit, and business volume, underpinned by a recovery in global aviation and effective trading strategies.

Key Financial Metrics and Performance Table

*No quarterly breakdown provided; 2H2024 figures inferred from annual data where available.

Business Highlights and Operational Performance

• Trading & Supply Volume: Total supply and trading volume increased 35.4% YoY to 13.77 million metric tonnes, driven by higher trading in crude oil and fuel oil, and a surge in jet fuel supply volumes.
• Associates’ Contribution: Share of results from associates rose 18.6% YoY, led by a 13.9% increase in refuelling volumes at Shanghai Pudong International Airport and higher profitability from Oilhub Korea Yeosu Co. Ltd (OKYC).
• Financial Strength: CAO maintained a healthy cash position with cash and cash equivalents at \$515.3 million as of 30 June 2025 (up from \$500.3 million at 31 December 2024) and remained debt-free.

Historical Performance Trends

CAO has demonstrated consistent year-on-year growth in all key financial metrics for 1H2025. Revenue, gross profit, net profit, and EPS all posted double-digit increases. The company’s net asset value per share also continued its upward trend.

Exceptional Earnings or Expenses

Other operating income declined by \$1.69 million compared to the previous year, mainly due to lower interest income and currency exchange differences. No significant exceptional earnings or one-off expenses were disclosed.

Chairman’s Statement

“The global economy is facing a complex and uncertain future, significantly impacted by escalating trade tensions and geopolitical instability. Against this backdrop, we remain focused on our strategy, navigating with confidence in the growth momentum of the global and Chinese aviation markets. Building on CAO’s pivotal role in the Chinese and global supply markets for aviation and other fuels, as well as in the optimisation of export opportunities for aviation fuel from China, we strive to further expand our resilient trading network through sustainable supply chains and mitigating potential market uncertainties. As the aviation industry accelerates towards a net-zero future, sustainable aviation fuel (“SAF”) stands out as a cornerstone of our business portfolio. We are committed to pursuing sustainable, profitable, and scalable development goals in our SAF supply business, while simultaneously driving business innovation and strengthening risk management, through which to build core competitive capabilities and a high-quality growth trajectory for the Company in the low-carbon business.”

The tone of the Chairman’s statement is cautiously optimistic, acknowledging macroeconomic and geopolitical challenges but reaffirming confidence in the company’s strategic direction and the resilience of the aviation sector.

Macroeconomic Environment and Outlook

• Industry Growth: The global aviation industry is forecast to achieve new highs in 2025, with Asia Pacific leading growth due to relaxed visa requirements and robust travel demand.
• China’s Impact: China is expected to account for over 40% of Asia-Pacific aviation traffic, propelled by a 6.0% YoY rise in passenger volume and a sharp 24.7% YoY increase in international routes for the first half of 2025.
• Sustainable Aviation Fuel (SAF): CAO is prioritizing the development of its SAF business, aiming for sustainability, profitability, and scalability as aviation transitions to a net-zero future.

Events and Corporate Actions

• No mention of dividends, share buybacks, placements, dilutions, or major asset sales in the disclosed period.
• No reported legal disputes, natural disasters, or other extraordinary events affecting business operations.
• The company’s strategy remains focused on supply chain resilience and risk management.

Conclusion and Investment Recommendations

CAO delivered a strong financial performance for 1H2025, marked by robust revenue and profit growth, improved business volumes, and enhanced contributions from strategic associates. The company’s outlook remains positive, anchored by rising aviation demand across key markets, especially in Asia Pacific and China, and a clear strategic pivot toward sustainable aviation fuel.

• For Current Shareholders: Given CAO’s continued growth, healthy balance sheet, and optimistic industry outlook, investors holding the stock may consider maintaining their positions. The company’s strategic initiatives and sector tailwinds are supportive of long-term value.
• For Prospective Investors: With demonstrated earnings momentum, exposure to the recovering aviation sector, and a focus on sustainability, CAO may represent an attractive entry opportunity for those seeking exposure to Asia-Pacific energy and aviation growth.

Disclaimer: The above analysis is based solely on information contained in the 1H2025 financial report. Investors should conduct their own research and consider their risk tolerance before making any investment decisions.

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