SITC first half profit soars on higher freight rates and volumes

Hong Kong's SITC International Holdings has reported a major surge in revenue and profit for the first half of 2025, driven by a significant increase in both container shipping volumes and average freight rates. The Asia-focused shipping and logistics company’s strong performance reflects a robust market, leading to a substantial rise in its gross profit margin.

For the six months ending June 30, the group posted revenues of $1.66 billion, a 28 per cent increase from the $1.30 billion recorded in the first half of 2024. This top-line growth translated into an even more impressive 79.5 per cent jump in net profit, which reached $633.4 million, up from $352.8 million in the corresponding period last year.

The company's outgoings also increased, though at a slower pace than revenues. Cost of sales, a primary expense, rose by 10.8 per cent to $995.1 million, which the company attributed mainly to higher equipment and cargo transportation costs.

The strong revenue growth, combined with more moderate cost increases, pushed the group’s gross profit margin up to 40.2 per cent from 31 per cent in the prior-year period.

In its management discussion, the company stated that the increase in revenue was the result of a combined effect, where container shipping volume increased by 7.3 per cent and the average freight rate rose by 22.8 per cent.

Looking ahead, the company noted that with the evolving global trade landscape, regional trade has become increasingly frequent, driving demand for "flexible and efficient" smaller container vessels. It stated it will continue to focus on expanding its service network in Asia. In light of the strong results, the board declared an interim dividend of HK$1.30 per share.