裕民航运召开2018股东常会

　　裕民航运於6月6日假台北国军英雄馆召开2018年度股东常会，由徐旭东董事长亲自主持，会中除报告公司2017年度之营运状况，亦通过财务报表及盈余分配等议案。2017年，全年合并营收为新台币（以下同）8,501,325仟元，税後盈余为999,520仟元，税後基本每股盈余（EPS）为1.18元。会中通过发放现金股利每股1.2元，仍维持高度盈余发放比例及高现金股息殖利率，此外裕民帐上保留未分配盈余及可供分配法定盈余公积合计为100.48亿元，达每股11.89元，可供未来年度盈余股利之分配。

航运景气与市场供需
　　2017年，由於世界经济进入复苏期、市场需求增加、新造船速度放缓等因素，海运市场一扫前一年的阴霾，从下半年开始，波罗的海乾散货指数（BDI）一路走高，在12月中旬，创下四年来的新高1743点。整年平均指数，与2016年相比，涨幅超过70%，2018年第一季平均1,173点，亦较去年同期成长24%。根据国际货币基金组织（International Monetary Fund, IMF）预估，2017年全球GDP约为3.6%，高於2016年的3.2%，IMF也预估全球经济延续2017年的成长动能，2018及2019年均将成长3.9%。其中中国表现优於预期，2017年GDP增长6.9%，2018年第一季GDP年增率为6.8%，此波景气回暖，为航运需求带来好消息。

　　继工业化之後，城市化成为中国经济发展的新主轴。2017年中国持续加速房地产去库存，房地产开发带动钢铁需求，粗钢产量达845百万吨，年成长约4.7%，占全球产量50%。2018年第一季生产210.8百万吨钢铁，较去年同期成长5%，再创历史新高。受到房地产调控及经济转型影响，预计中国钢铁消费及产量增长将稍许减缓。然而，中国持续执行「淘汰落後产能」、「去空污除霾害」、「节能减排」等政策，带动了高品位铁矿砂的进口需求，2017年进口1,074.7百万吨铁矿砂，创下历史新高，预计中国依赖进口铁矿砂的比例将稳定维持在83%左右。另外东协市场因受惠於中国「一带一路」，在2017年整体区域平均的GDP自2016年的4.8%上升至2017年的5.1%，远高於全球市场。经济发展刺激大量能源需求，煤矿因价格低廉，仍为新兴国家首选。国际能源署（IEA）与能源顾问公司Wood Mackenzie皆预估，东协国家及印度将取代中国，引领未来数十年的全球煤矿需求。

　　船舶供给方面，2017年仍是供给过剩的状况，截至2018年5月，散装船队总计826百万DWT，年成长约2%，呈现缓步成长，新船订单占整体船队不到一成，船队供给增长来到历史低点，有助於航运市场持续复苏。目前15年以上老旧船舶占整体船队14%，略高於新船订单占比。国际海事组织规定2019年9月开始强制实施设置压舱水处理系统，「0.5%低硫油公约」将於2020年1月正式实施，国际环保法规将加重船东营运成本，可望加速老旧船拆解，进一步改善市场供需状况。

扩展业务与绿色航运
　　在扩展核心业务方面，裕民於2018年初与全球最大铁矿石生产商巴西淡水河谷 Vale International SA of Switzerland公司签订25年铁矿石长期运送合约，此为裕民成立以来所签订的最重大长期合约，将自2020年起承运巴西出口至中国的铁矿石运输业务至2045年，预计合约总收入可达美金6亿元以上，除此之外此合约关系间接使裕民与Vale现货市场交易更加热络，有助於裕民开拓巴西至中国的长航线运务市场。另外为深耕中国市场，於今年初与厦门国贸集团公司(ITG)成立了两家合资公司，预期加速拓展业务带来获利。

　　裕民领先业界，加入澳洲与中国大陆之间铁矿石和煤矿贸易的「绿色走廊」跨国计画。与澳洲主要矿商必和必拓(BHP Billiton)、力拓集团(Rio Tinto)、FMG集团、船东商船三井(MOL)、挪威船级社(DNV GL)、伍德赛德能源公司(Woodside Energy)及上海船舶研究设计院(SDARI)，共同研究建造液化天然气(LNG)及燃油双燃料动力海岬型散装货轮(Newcastlemax)。目前已发表有210,000 DWT双燃料矿砂原型设计船，准备用於运送西澳到中国铁矿砂运务，该型船符合环保节能减排绿色航运特点。另外配合与巴西淡水河谷25年运务合约所订造的两艘32.5万吨的超大型矿砂船(VLOC)，也加入改装LNG燃料弹性设计，未来将可改装为LNG燃料船。LNG是一种乾净、高效能的燃料，对环境更为友善。

智慧管理与企业社会责任
　　裕民积极再造船舶管理模式，从2016年起导入端到端的船联网，提供即时的船舶资讯、船只位置与动态，并监控船舶航行速度，管控燃料消耗量。此不仅增加岸上对船上的能见度，并支援流程自动化，改善船队管理效率，将有助於船队管理转型。另外，为落实船队安全、降低重大海事风险，成立专职「船队安全纪律访察小组」（Safety Discipline Officer Team，简称SDO），登轮实地访察，与船上船员充分沟通，宣导各项安全规定，经由缺失的发掘与改善，形成船队的安全文化。今年，因船舶安全纪律稽核的执行，事故伤害率比往年大幅降低。

　　裕民航运长期致力於永续经营，荣获国内外的肯定。2017年再次获得台湾永续能源研究基金会《台湾企业永续奖》运输业银奖殊荣。同时也通过评监并纳入英国《富时社会责任新兴市场指数FTSE4Good Emerging Index》及《台湾永续指数FTSE4Good TIP Taiwan ESG Index》成分股，这都肯定了裕民於环境保护、企业社会责任和公司治理执行的表现。＃

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Optimizing and Modernizing U-Ming:
Digitalizing Operations and Expanding Core Business

1) Business Performance
U-Ming Marine Transport Corporation has convened its 2018 Annual Shareholders’ Meeting (AGM) at the Taipei Hero House on June 6, 2018; hosted by its Chairman, Mr Douglas Hsu. During the AGM, Mr Hsu presented the Company’s 2017 Business Report; and motions such as Adoption of the 2017 Financial Statements and the Proposal for Earnings Distribution of 2017 etc. were passed. For 2017 operating performance, the Company’s consolidated revenue amounted to NT$8.501 billion; net profit was NT$0.999 billion and the earnings per share (after-tax) was NT$1.18. The motion to cash dividends of NT$1.20 per share to reward the shareholders was passed. The Company has always been maintaining a sound financial structure of which the retained undistributed earnings and the statutory surplus reserve available for distribution as future annual earnings dividends amounted to NT$10.048 billion; equivalent to NT$11.89 per share. U-Ming will continue to create shareholders’ value to reward its shareholders.

2) Market Outlook
The shipping market in 2017 was relatively better compared with the previous year as a result of the global economic recovery, the increase in demand, the downshifting of the new shipbuilding, etc. The Baltic Dry Index (BDI) rose to a new high in four years at 1,743 points around mid-December. Overall, the 2017 average index rose over 70% compared to last year as a result of the global economic recovery; coupled by the increased market demand and the slowing down of newbuilding deliveries. The average BDI in Q1 2018 was 1,173 points, a 24% growth compared to the same period in 2017.

According to International Monetary Fund (IMF), the 2017 global GDP was around 3.6% which was better than the 3.2% in 2016. IMF also forecasted the global economy will continue its growth momentum in 2018 and 2019 by 3.9%; among them, China will perform better than expected. China’s GDP growth for 2017 was 6.9% and its Q1 2018 growth rate was 6.8%. This expected economic recovery is obviously good news to the maritime industry.

Following the reformed industrialization, China’s urbanization has become the primary cores for its future economic growth. China continued to accelerate real estate destocking in 2017 driven an accelerating demand for steel. In 2017, China’s annual crude steel output reached 845 million tons, a growth of about 4.7%, contributed to about 50% of the global crude steel production. China’s steel production had increased by 5% YoY in the first quarter of 2018 which was a record high of 210.8 million tons. Despite the expectation of the slowing down of China’s steel consumption and output growth due to the new real estate regulation and economic restructuring, the continued implementation of various government policies like the Backward Capacity Elimination, the Air Pollution & Smog Hazard Removal and the Energy Conservation & Emissions Reduction, China’s import demand for high-quality iron ore had been increasing as shown by the annual import volume of 1,074.7 billion tons, thus invigorating the international trade. It is expected that China’s dependence on imported iron ore will remain stable at around 83%.

Benefitting from China’s “One Belt, One Road” initiative, the overall ASEAN market was also in the expansion mode in 2017; which resulted an average GDP growth from 4.8% in 2016 to 5.1% in 2017, far above the global market. Economic development stimulates higher energy demand, and coal has become the first choice for emerging countries due to its relative low prices. According to the International Energy Agency (IEA) and energy consultant Wood Mackenzie, the coal demand in ASEAN countries and India will surpass that of China in the next few decades.

On the supply side, the over-tonnage situation still persisted in 2017. As of May 2018, the total dry bulk capacity is 826 million dwt but the fleet growth was at a slower pace of 2.0%. The new bulk carriers’ ordering is less than 10% of the total current fleet and the over 15-year old bulk carriers constituted about 14% of the total current fleet, thus surpassing the new building growth. The forthcoming Ballast Water Management Convention’s implementation in September 2019; together with the January 2020’s 0.5% Sulphur Cap regulation are expected to burden owner’s operating expenses thus resulting an expected faster pace in ship demolition activities which will in turn stabilize the over-tonnage situation.

3) Core Business Expansion and Green Shipping Initiatives
In January 2018, U-Ming has signed a 25-year Contract of Affreightment (COA) with Vale International SA of Switzerland for the transportation of Brazilian iron ore to China; commencing in 2020 till 2045. The COA is the biggest and longest commitment in U-Ming’s history and the total contract value is anticipated to be more than US$600 million. This contract will also enhance U-Ming’s spot cargo business relationship with Vale and strengthen the company’s presence in the Brazil-China long-haul freight market. To enhance our involvement in the Chinese market, the company has also signed an MOU with ITG Xiamen in September 2017 to the eventual set-up of the two joint venture companies in early 2018 to leverage on the respective company’s cargo base and shipping expertise.

In response to the IMO’s 0.5% sulphur cap regulation to be effect on 1 January 2020 and the commitment for greener shipping, U-Ming has participated in the Australia-China’s “Green Corridor” project with the leading mining companies like BHP, Rio Tinto and FMG; together with MOL, DNV-GL, Woodside Energy and SDARI to jointly develop a dual-fuel (LNG/Fuel-oil) 210,000 dwt Newcastlemax bulk carrier specification - an alternative to the conventional fuel-oil engines. This is in preparation for the company’s future Australia-China’s iron ore trading route and to better service its customers. Besides, the 2 x 325,000 dwt VLOC (Very Large Ore Carrier) that the company has ordered for the Vale’s 25-year contract, are designed for LNG-ready purpose thus have the flexibility in switching to LNG fuel.

4) SMART Management and CSR
In 2016, the company has collaborated with Ericsson to optimize the vessels’ management system. The point-to-point internet link between ships was implemented to provide real-time information on vessels’ locations, movements and speed & fuel consumption. The system can also enhance the onshore visibility of vessels to support automation process and to minimize human intervention thus raising fleet management efficiency.

The risk exposure to accidents and casualty is high in the marine industry, thus the company has set up the Safety Discipline Officer Team (SDO). Its purpose is to audit and to cultivate safety culture onboard our ships. With enhanced communication onboard regarding ship operating procedures, maintenance and case studies’ learning, there has been a marked improvement in terms of deficiency detections and fleet safety record in 2017.

U-Ming has won many recognitions both at home and abroad for its continuing pursuit of sustainable development; one of those was the Silver Award in the logistics category at the 2017 Taiwan’s Corporate Sustainability Awards organized by the Taiwan Institute for Sustainable Energy. The company has also passed the evaluation of FTSE Russell and Taiwan Stock Exchange’s criteria to be a constituent the FTSE4Good Emerging Index and the FTSE4Good TIP Taiwan ESG Index. These achievements have indeed proven the company’s outstanding performance in the environmental, social, and governance initiatives.

5) Fleet Overview
U-Ming’s core business is in dry bulk shipping sector which currently owns and operates Capesize, Panamax, Post-Panamax, Supramax, Ultramax, Cement Carriers, Very Large Crude Carriers (VLCC) and Very Large Ore Carriers (VLOC), amounting to a total of 48 vessels (including vessels that are in operation, under construction, joint ventures and ship management service); with a total deadweight of 6.66 million tons. The company has its subsidiaries in Singapore, Hong Kong and Xiamen, China.#