COSCO Pacific Aktie

Dear shareholders, investors and friends of the media, good afternoon. I am [indiscernible] from the PR and Investor Relations Department. Welcome to our 2025 annual results announcement. Welcome, and we also have participants online. Today, we're very happy to have invited the following members of the management to be with us. They are Mr. Zhu Tao, Chairman of the Board; Mr. Chen Yipeng, Deputy General Manager; and Mr. Zhao Fengnian, our Chief Accountant.

Today's presentation is divided into 2 sessions. First, our management will take you through the performance of 2025 and future outlooks to be followed by the Q&A session. We welcome questions from all of you. I invite Mr. Zhu, Chairman of our Board, to take us through the performance of the year and future outlook. Mr. Zhu, please.

Good afternoon, investors, members of the media and distinguished guests. I'd like to welcome you all to our company's annual results presentation. On behalf of the company, I would like to extend our sincere gratitude and a warm welcome to everyone here today. We thank you for your continued interest in the company and support of our company. We hope to use this presentation as an opportunity to engage in direct communication and dialogue with all of you.

Today's results announcement will be divided into 5 sections, highlights of the full year results, financial performance, operational review, strategy and outlook and finally, Q&A session. First, let's take a look at the highlights of our performance. In 2025, the global economic and trade landscape underwent sharp adjustments and entered a period of profound restructuring. Despite multiple challenges, our economy remained generally stable with total import and export value reaching a record high, allowing the country to retain its position as the world's largest goods trading nation.

According to the statistics from the General Administration of Customs, total value of China's goods trade in 2025 reached CNY 45.47 trillion, representing an increase of 3.8%. Exports amounted to RMB 26.99 trillion, up 6.1%. Imports reached CNY 18.48 trillion, up 0.5%. Trade with emerging markets such as Africa, Asian and Latin America maintained strong growth momentum, rising by 18.48% and 6.5%, respectively. We focused on core businesses, fully leveraged synergies with the group, deepened lean operations and enhanced competitive advantages. We recorded growth in throughput revenue and profit.

Total throughput reached 150 million TEU, up 6.2%. Revenue reached USD 1.67 billion, up 11%. Profit from joint ventures and associates, USD 340 million, up 7.3%. Profit attributable to equity holders, $310 million, up 1.1% against the backdrop of profound adjustment in the global economic and trade landscape and complex and volatile geopolitical conditions. We proactively seized market opportunities, continue to strengthen our core hub layout and improve operational efficiency, adhere to high-quality development to actively address the uncertainties of external environment. Leveraging on our global terminal network with efficient connectivity, we continue to capitalize on synergies with our parent company. Next, please welcome Mr. Zhao to present full year financial results.

Thank you, Mr. Zhu, for your introduction. Good afternoon to all of our friends in the financial media and investors. I'll now move on to the second part of our presentation of financial performance for the full year. Driven by factors such as increased container volume and sustained growth in freight rates and storage revenue, our overall business performance was strong, achieving steady improvements in operational quality and efficiency. We continue to achieve results in improving quality and increasing revenue with revenue rising 11% year-on-year. Our non-subsidiary terminals, we continue to optimize management and profitability, driving synergistic development, resulting in a 7.3% year-on-year increase in our share of profits from joint ventures and associates. Profit attributable to equity holders increased by 1.1%. Dividend payout ratio maintained unchanged at 40%. Annual dividend, [ USD 0.03256 ] per share.

Now let's take a look at the revenue and GP margin of our subsidiary terminals. For those in China, revenue increased by 2.9% year-on-year and gross profit margin remained at a relatively high level of 34.3%. GP margin of our 3 major subsidiary terminals remained above 38%, with Guangzhou Nansha terminal achieving GP margin as high as 46%. Moving forward, we will implement the following measures. At the Tianjin Container Terminal, comprehensively promote standardized services, combining container loading and unloading, warehousing and distribution and value-added services within the port to boost growth in both domestic and international trade.

At Xiamen, we'll continue to improve feeder service development and expand rail hinterland connections, transforming the terminal into a new green and smart international railways transfer hub. At Guangzhou Nansha Terminal, we continue to strengthen logistics efficiency and network service capabilities, linking it with other subsidiary terminals such as Xiamen and Wuhan to form a large intermodal rail sea transport triangle network.

Regarding overseas subsidiary terminals, revenue increased by 18.5%. PCT Terminal Greece revenue growth by 16.7%. Moving forward, the terminal will leverage the opportunity presented by the gradual reopening of the Red Sea to promote resumption and introduction of new routes, continuously expanding the market, consolidating its position as a hub. CSP Spain revenue rose by 8.6% with container volume reaching record high, establishing it as one of Ocean Alliance's primary ports. CSP Abu Dhabi Terminal will focus on developing regional transshipment cargo to enhance our region influence.

Our terminal in Peru will continue to expand feeder and mainline network and develop rural and general cargo operations at high-quality development in the Asian and Latin America land sea new corridor. Full year terminal profit reached $440 million, representing 4.5% growth. Terminal profits in China reached USD 365 million for the year, increase of 1.3%. Domestic perspective shows fundamental trend of China's long-term economic growth remains unchanged. Regional coordination strategies such as coordinated development of Beijing, Tianjin, Hebei region, Yangtze River Delta integration, et cetera, are being vigorously advanced. Initiatives to expand domestic demand and build a unified national market have created vast opportunities. Overseas terminal profits reached $78.59 million, an increase of 22.9%. In the Mediterranean and Middle East region, PCT terminal in Greece rose by 40.5%.

We further advanced synergies with our dual brand fleet to support the development of China Europe Land sea corridor. Since Abu Dhabi terminal we strengthened internal and external marketing efforts, optimized layout of the Middle East feeder network and enhance regional logistics distribution center. In Spain, we'll continue to leverage regional advantages to improve hub efficiency and boost container throughput. Balance sheet. By the end of the year, our cash and bank deposits stood at $1.33 billion, maintaining a stable and healthy position. Total CapEx for the year amounted to approximately $386 million, about $164 million was allocated to investments, $222 million allocated to PP&E. Net debt-to-equity ratio stood at 25.1%, remaining at a relatively low level in recent years. Moving forward, we'll continue to leverage our low leverage advantage and focus on emerging markets with high growth potential.

Concerning borrowing costs, we implemented a multipronged approach, including refinancing existing loans, optimizing the debt structure and using internal funds to repay a portion of high interest loans, which drove the average cost of bank borrowing down to 4.54%.

We will now invite Mr. Chen to present the company's operational review.

Thank you, Mr. Zhao, for your detailed overview of the company's financial performance. Good afternoon, investors and members of the media. I will now provide an overview of our operational performance. In 2025, our total throughput reached 153 million TEU, an increase of 6.2%.

Both domestic and overseas terminal throughput recorded year-on-year growth with the following highlights. Total terminal throughput in China reached 115 million TEU, an increase of 4.6%, driven primarily by volume growth in PRD and Southwestern coastal regions. The company has intensified its marketing efforts, continue to expand route networks and engage in customer outreach increased terminal container volume and revenue. We will implement the Hub+ Corridor+ Network strategy to drive the optimization of domestic supply chain. In overseas regions, total terminal throughput reached 38.16 million TEUs, an increase of 11.5% year-on-year.

The company has accurately seized the opportunities presented by the restructuring of global industrial and supply chains. optimized our industrial structure and regionally layout and built a globally integrated network for coordinated development. In terms of equity throughput, it rose 3.4% to 46.85 million TEU. Equity throughput at terminals in China reached 32.79 million TEUs, up 1.6%, mainly driven by growth at terminals in PRD and Southwest regions. We will coordinate dual container shipping brands to channel incremental cargo from a domestic interland to Southeast Asia and Middle East, expanding business volume and serving both domestic and international customers. In overseas regions, equity throughput reached 14.06 million TEUs up 7.9% as cooperative frameworks such as the RSP continue to take effect.

They provide broader cooperation opportunities and diversified pathways for global trade. Emerging markets such as Southeast Asia, Middle East and South America have become the primary sources of growth in the container market. We will prioritize expanding our terminal footprint in these high-growth regions. In 2025, container throughput at company subsidiary terminals increased by 1.8% year-on-year, with throughput of international routes rising by 4.6%. Benefiting from the dual brand strategy, container volumes contributed by COSCO Shipping Lines OOCL increased significantly, rising 13.3% and 7.4% year-on-year, respectively. We actively responded to market changes and route adjustment by innovating marketing models, continuously introducing new routes and expanding cooperation with other alliance fleets to optimize the structure of our route portfolio.

In terms of ASP, European control terminals increased by 9.2% in euro terms, primarily due to the strong performance of PCT terminal in Greece and terminals in Spain, which drove continued growth in revenue per container. This year, we will actively respond to internal, external market changes, focusing on strengthening domestic and international trade corridors, network development and expansion of new business opportunities. We'll continue to increase our business scale, optimize our cargo mix and improve ASP. We're capitalizing on the opportunities presented by the restructuring of global industrial and supply chains to accelerate the expansion of our global port logistics network.

There are some achievements. First, CSP Haitou Supply Chain project has made new breakthroughs in the development of cross-border e-commerce operations, maintaining consistently high average utilization rates. In the future, we will continue to expand our supply chain business in Southeast Asia. Second, Xiamen Haicang CFS will establish a freight train plus liner Rail Sea Express network and premium intermodal routes developed the sea [ rail ] premium route from Wuhan to Xiamen. Third, CSP Abu Dhabi CFS will continue to develop intermodal rail sea transport products, optimize warehouse and distribution layouts to improve space efficiency and enhance food chain service capabilities and overall profitability.

Fourth, CSP Zeebrugge CFS. We will strengthen rail operations, improve quality and increase volume, integrate internal and external resources and expand profit channels. Global port and shipping industry is shifting from point-to-point competition to chain integration and network synergy. We will strengthen technological innovation and promote deep integration of AI with port operations. To continuously improve the efficiency and scale of automated equipment, unmanned container truck operations are fully entered commercial operation at 5 terminals, Xiamen, Wuhan, Quanzhou, Abu Dhabi and Chancay with the average cost per container reduced by about 10% compared to traditional manned container trucks. Cumulative throughput of unmanned container trucks reached 1.27 million TEUs in 2025. representing an 88% year-on-year increase. Moving forward, we'll continue to deepen the integration of AI with core port operations, including cargo handling, scheduling, equipment maintenance and security to empower these functions.

We'll advance projects such as smart terminals and intelligent security systems, actively promote large-scale application of smart technologies. We transition from traditional operations to new ecosystem-based competitive model, actively embrace technological applications such as digitalization, AI technological innovation. We'll continue to accelerate innovation-driven development focus on building replicable modern ports and comprehensively forge a paradigm of efficient and intelligent development.

Now Chairman Zhu will introduce our development plans and outlook.

Thank you, Mr. Chen and Mr. Zhao for your introduction. Now let's take a look at the company's strategic plan and outlook. In recent years, the company has achieved rapid expansion in our global network. Moving forward, we'll focus on the growth of emerging markets, enhance regional diversification of our asset portfolio and reshape our core competitiveness for the future. First, we'll focus on strategic leadership and optimize global development layout.

We will adhere to the guiding principle of expanding our global footprint externally while deepening operational efficiency internally, accelerating the construction of a global terminal network that promotes coordinated development of mature and emerging markets, greenfield and brownfield terminals and hub and gateway ports. Second, deepen our operational synergy to comprehensively enhance quality and efficiency. We'll build on lean operations, strengthen marketing and internal coordination and seize opportunities arising from the release of shipping capacity through flexible commercial terms and differentiated services. We'll continue to broaden perspectives and dimensions of cost control, leverage economies of scale, reduce costs and identify opportunities for value enhancement.

Third, we'll strengthen network integration to enhance comprehensive service capabilities. We'll focus on upgrading from point-based development to network synergy, continuously strengthening the feed and Chunaline networks and corridor development at key hubs to improve transshipment and radiation capabilities. Fourth, strengthen innovative development and drive green and smart upgrades. In terms of digital intelligent transformation, we will align with new development philosophies to gradually establish our digital system and complete implementation plans for AI across short, medium and longer term. Regarding green and low-carbon initiatives, we will expand promotion and application of new energy equipment to explore new pathway for green development.

Our company will continue to be guided by 5 pillars of sustainable development, integrity and mutual benefit, resilience for the future, agile innovation, [indiscernible] nature and dynamic progress and integration to systematically promote deep integration into ESG governance with production and operational management. We help the company and its value chain achieve coordinated economic, social and ecological development as well as high-quality progress. Thanks to our long-term dedication and governance practices in the ESG field, we have earned a high recognition from leading domestic and international ESG rating and index agencies. Our wind ESG rating has been upgraded from A to AA. CDP climate change rating has improved to B. Our sustainability ESG rating remains at A+. Our Morningstar ESG risk score continues to remain at an A low risk level. The company remains steadfast in its long-term commitment to achieving carbon neutrality by 2050.

We adhere to sustainable development as our core guiding principle, actively promote innovative practices and are dedicated to continuously contributing value towards building a modern port ecosystem that includes digitalization, smart tech and green low-carbon development. We expand our global footprint and resolutely advance digital and smart empowerment alongside transition to a green low-carbon future. The company achieved several significant milestones in the field of sustainable development. Greenhouse gas emissions intensity decreased by 38.5% compared to the base year energy consumption intensity decreased by 22.2%. We completed the first climate-related financial impact analysis and conducted nature-related assessments of the company's major control assets in accordance with the TNFD framework.

Our Tianjin terminal has -- was awarded a double 4 star destination as a smart and green port. Wuhan Terminal became the nation's first smart port to integrate communication transmission with real-water intermodal transport. These achievements are a good reflection of our strategy to use digital intelligent development as a key driver, strengthen innovation-driven growth and accelerate transition to a green and low-carbon future. Looking ahead to this year, with the expansion of the BRICS Group and accelerated rise of the global South, the development potential of emerging economies will continue to be unleashed, and they are expected to become a key driving force for global economic growth.

Locally speaking, our economic foundation remains solid, advantages are numerous, and there continue to be strong resilience and fast potential. Underlying conditions and fundamental trends supporting long-term positive growth remain unchanged. In global port market, emerging economies transition from participants to engines of growth with global industrial chains. Dominant position of Asian ports continue to stabilize, fostering a more balanced and diversified global economic system, which all inject new momentum into global trade.

Global port logistics resources serve as a core pillar of our 3 integration strategy and are crucial to cost chip and cost enhancement of core functions and improvement of our global competitiveness. We accurately seize the opportunities presented by restructuring of global industrial and supply chain, accelerate expansion of our global port logistics network, optimize operations to maximize the investment value of our global network and move swiftly toward the goal of becoming a globally leading logistics service provider with core resources. We will now enter the Q&A session. We welcome questions from all of you.

Thank you, Chairman and other members of the management for your detailed introduction. We'll now move on to Q&A to raise first invite questions from on-site participants and we will then invite questions from those online. And finally those calling in over the phones. Please only raise one question from each organization. Let's invite in-site -- on-site participants to raise your hands if you have a question. Please briefly tell us your name and who you represent before you ask your questions. And the same applies to those who are calling in and raising questions online. This gentlemen, thank you.

Thank you very much, the 3 of you for your introduction. Concerning the performance of the company in the past year. And also, we looked at some future projections. And from DBS, I'm Senior President responsible for the China team. I'm delighted to be here today. Actually, I have a question, which is probably on everyone's mind around the world for the port industry, what is the outlook? And what about the situation and the war in the Middle East? What are the impacts on our business? Thank you.

Okay. Outlook. Mr. Chen, please take that question.

Thank you. I am honored to offer some insights about ports around the world. According to IMF's latest projections, 2026 will be a year sustaining growth with economic growth at around 3.3% around the world. Concerning shipping industry, because of some previous tariff movements and also accelerated shipment in 2025, we saw a higher trend and then it gradually came down. But this year, in 2026, around the globe, the growth is about 1.8% to 1.9%. That is the overall figure. To be more specific for different regions in Europe, it will stay at a relatively stronger performance, 7.8% at the moment for Latin America, there will be some new growth engines with great potential. In Southeast Asia, because many activities have been shifting from China to Southeast Asian areas.

They are looking at a growth momentum of 8%. Concerning the Pacific region, some routes from the U.S. are under pressure. 2026 may show a negative growth trend. Our company is paying very close attention to the situation and taking necessary measures. I will take your second question. I understand that we are all quite concerned about the situation in the Middle East and the Red Sea. And also among the U.S. and Israel and Iran, many conflicts have broken out. We do have the terminal in Abu Dhabi in that region. With the guidance of our group, we pay close attention to the development of the situation. And we have already made necessary actions to stay well informed of the latest development.

We will continue to work very hard. So far, Abu Dhabi terminal, our assets and also our staff members, they are safe. So in terms of operations of terminals, which have been affected, we are exploring new channels or corridors, new routes so as to bring updated solutions to our customers. So what is happening in the Middle East? Yes, there will be some impact on the throughput level for Abu Dhabi. But for the entire region, our business level should not be much impacted.

Let's take a second question from the lady, please.

Thank you very much for your sharing. I. I am [indiscernible] I want to follow up on the latest deal that you are involved in, do you have any update.

No response. Let's invite the third question. Perhaps I can turn to some questions online. We'll come back to you. The first one from [indiscernible] of Pinnacle. 2025, what are the movements concerning profitability and the contribution from different regions. I think Mr. Zhao, you can take that.

All right. I will give a brief answer to that. For 2025, domestic and international assets, USD 440 million. So for the former in Greater China region, for terminals, the profit, USD 365 million, up by 1.3%. In this segment, the outstanding performance -- the contribution in relation to the overall profit dropped from 84.9% to 82% this year. Particularly our terminals in Xiamen, Tianjin Wuhan, the profit level came down -- that is why the trend is a declining one. Concerning storage and also non-subsidiary terminals, there are very good performances. Yantian Terminal and Dalian, Containerboard, Nansha, they have driven up the overall profit level. For international assets, the profit, USD 78 million, up by 22.9%, which is a very substantial increase. They are mainly affected by the terminals in Spain and Greece, which have all gone up. For non-subsidiary terminals, they are mainly affected by the Suez channel, the profit level has gone up by 28.5%. So that is the analysis for domestic and international assets.

The second online question from [indiscernible] at the moment, there's a lot of innovation in relation to the Internet, big data and AI. How do you use such capabilities to drive down your emission and realize the construction of green ports to achieve synergized development with digitalization and greening and low carbon.

I will take that question. In our strategies, you have already seen that concerning digitalization, greening and low carbon emission, they are core drivers and core strategies. Beginning from last year, we have paid special attention to the industry and also the tech sector in relation to AI technologies and applications. We have combined them with our developments. So we have established AI infrastructure, enhanced AI capabilities. We've looked into large language models and big data. So digitalization is driving our forward movement and transition. We have strengthened our AI capability. We have put together different scenarios and forum. We have hosted AI themed competitions to enhance AI application and utilization capability among our staff members.

Secondly, we have fortified our AI infrastructure capability. We have improved our algorithm assets. So the group at the moment is also looking into using new tech and new standardization efforts. At the same time, we have screened out 13 terminals. We have make some investments in terms of the digital advancements. Thirdly, we have moved forward the LLM for the enterprise. Our positioning is mainly on the enterprise side. We have screened 50 high-level demand areas, and we also have application of AI in our procurement efforts. Our centralized procurement department has used AI to enhance their capability.

And we have made a saving of more than 50% in terms of working hours and efficiency enhanced by 20%. We have set up this CSP platform with algorithm assets supporting our LLM and different business units based on their own scenarios can create their own AI systems. We have already started testing and application. Fourthly, we will continue to support thematic AI projects. So with a clear road map, we have launched many AI dedicated projects. So we are using terminal-driven data -- and we have achieved data silos from the past. We are now connecting different stages and enhancing efficiency through such use of new technology to increase the overall throughput level at various terminals. So things are moving along very quickly. We have also launched a number of smart placement scheme for containers.

So last year, we have completed this digital twin scenario to cover the entire CSP security system. We will use videos, text and photographs to enhance the security and safety for all our ports. Concerning our current business and future business, that is injecting a lot of new energy and capability. So we will continue to stay on this direction so that we will continue to use the most advanced technologies to support our services. Thank you very much.

Now let's look at the third online question from [indiscernible]. What is the potential and opportunities for the development of this market, which regions and routes do you think more positively about?

All right. I will give a brief response as well. We run ports, but ports are closely tied with shipping business. So we pay very close attention to the shipping sector. We have already talked about some projections about ports because of global economic growth. The momentum will be a stable one. IMF projection for 2026 economic growth will be 3.3% around the world. That level is still lower compared to the period between 2000 and 2019. The overall level is 3.3%, but internal structure has gone through fundamental changes. New emerging economies are driven by strong internal demand and their growth momentum will reach 4.2%, including China's growth staying at 4-odd percent. At the same time, because of geopolitical tension, accelerating the supply chain does face certain challenges and risks.

The supply and demand situation will continue to evolve, and there will be certain fluctuations in terms of freight rates and freight capabilities. And we are going to make necessary changes. We rely on our dual brand fleet, their capabilities, our overall layout of capabilities. So in the Middle East, Southeast Asia, between China and U.S. and also South America, we feel that is where most of the potential will come from.

Next question online from [indiscernible]. What is your dividend payout policy, any future adjustments.

Mr. [indiscernible].

All along, we have a stable payout policy. Our intention is to allow shareholders to enjoy reasonable and stable return and at the same time, support our future growth. We need to strike a balance between the 2. To be more specific, the second payout or dividend level is still at 40%. In the past 18 years or so or since 2018, we have been adhering to the 40% payout ratio, which is stable.

And compared to our peers and competitors, it is at a reasonable level. We attach great importance to the interest of our shareholders, and we're happy to, together with investors, share the fruits of our development and at the same time, support our long-term development. Looking ahead, we will, like in the past, continue to consider all the relevant factors to adjust our dividend payout policy.

Next question from online [indiscernible]. Do you have any forward-looking carbon neutrality road map? Do you have specific indicators or targets?

Well, concerning that, I will give a brief response. Actually, just now, we shared our strategies. We talked about digitalization, greening, low carbon, they are all core strategies for the company. Concerning our planning, by 2050, according to our target, we can reach carbon neutrality. And we are using 2020 as the base year. Last year, concerning energy saving and carbon emission reduction, we have been referring to 2020 as the base figure. Green gas emission by 2050, we want to reduce it by 55% and energy saving up to 45%, and we want to reduce the consumption of green gas, achieved reduction of 38.5% compared to 2020. And we have already fundamentally reached these short-term goals.

The company by 2030 for domestic assets, we will complete 100% of use of green energy. We have already completed our target by 50%, and we can also very likely achieve our 2030 target well in advance. We continue to support the construction of green corridors by 2030, 80% of our terminals around the world, there will be green facilities for power supply. They are quite popular and commonly seen in domestic terminals, and we are planning to apply them around the world. We believe that because of our continuous innovation and optimization, we will continue to be the global leader. And looking into the future, we will continue to deepen our digitalization and greening efforts so as to lead the sector to this ultimately sustainable development era.

Because of time constraints, we are going to accept 2 final questions. On the telephone line, can we take a question.[Operator Instructions]

[indiscernible] it is your turn.

Thank you very much dear leaders of the company. Some investors have talked about the issue of political conflicts. Well, since things are intensifying, what do you think about the long-term profitability outlook for the company concerning your overseas assets? Any new changes concerning optimization of overseas assets?

Okay. Concerning that question. I will give you a brief report. As you have mentioned, beginning from last year, we can see around the world, geopolitical conflicts are intensifying and that has created impacts on shipping and trading and also our business. We do face many challenges, but we think around the world, there are also plenty of opportunities. Some actually stem from crisis. So we will continue to adhere to stable development to confront uncertainties externally. We will continue to explore and deepen our foothold in overseas markets.

We will improve operations of our existing terminals. And domestically and internationally, we have invested into 40 ports and 50 terminals. If you look at demand from our customers, we will continue to expand our layout. That is the key initiative for focus on emerging markets and regional opportunities. We will participate in green terminals and greenfield terminals and brownfield terminals. We will look at any fluctuations in the supply and demand mechanism. And in Southeast Asia, South America and Africa will be our focus of future investment opportunities. In these 3 regions, we can expand our presence and emerging markets are also showing a lot of tenacity in their development and very well-supported demand.

So we will definitely rely on our own scale to identify risks and we will be value-driven to create great return for our shareholders. Of course, we belong to COSCO SHIPPING Group, and they are a truly international enterprise. They have been serving regional economic developments around the world. They have operations in many countries and regions.

Since it is so international, our ports also have to be truly international. So together with different terminal and port operators, we will maintain friendly relationship and identify potential investment opportunities so that we can become a truly international network of ports and terminals. That is how we are going to tackle the existing changes.

Thank you, Mr. [indiscernible]. Final opportunity, let's see from HSBC, 2026 throughput level and ASP outlook. Mr. Chen.

2026, we are looking at a growth of 4.6%, so looking ahead, as we have mentioned, we will continue to enjoy growth, although the momentum may be slowing down slightly against this backdrop. We will continuously rely on optimization and adjustments to our operations and provide extended services so that we can increase revenue. We are confident our revenue level in various regions compared to our peers, we will win compared to the overall market.

Thank you very much. Because of time constraints, we are wrapping up today's presentation. If you have any further questions, please contact our IR team. Thank you again for your long-term concern and support. We look forward to seeing you again at our next announcement. Thank you.

Dear investors and friends of the media, good afternoon. Thank you for your attendance at our first half results presentation. We have a mixed mode today. And we have Ms. Wu Yu, our Managing Director; Deputy General Manager, Mr. Chen Yipeng; Mr. Zhao Fengnian, our Chief Accountant. We are going to take you through the performance highlights and also operational review. Later, we'll take your questions. Madam Wu, please.

Thank you very much. Dear investors, friends of the media, good afternoon. I am Wu Yu, Managing Director for the company. First of all, I would like to welcome all of you to our first half results presentation. On behalf of the company, I would like to extend our gratitude and welcome. Thank you very much for your long-term support and concern. And we would like to use this opportunity to make exchanges with you on site.

Concerning today's presentation, there are 5 parts. We have the key highlights, financial performance, operational review, strategy and outlook. And finally, we will have the Q&A session. First of all, let's go over the company's key highlights. In the first half of '25, the global economy continued to grow at a slow pace, and there continue to be changes in trade policies and geopolitical risks. We leveraged its global the company's global network and synergy with other COSCO SHIPPING brands to seize the opportunity presented by the surge in trade demand during the phase, achieving double-digit growth in throughput and profits, demonstrating strong capabilities in handling risk and operational resilience.

In the first half, we achieved total throughput to 74.3 million TEU, a rise of 6.4%. Revenue increased by 13.6% to USD 806 million. EBITDA up 10.5% to USD 445 million. Net finance cost decreased by 14%. Profit attributable to shareholders reached USD 182 million, up 30%. Against the backdrop of profound adjustments in the global economic and trade landscape and complex geopolitical developments, we have actively seized market opportunities, continuously strengthened our core hub layout, improved operational efficiency and adhere to high-quality development to positively respond to external uncertainties. We leveraged our globally connected network and the synergies of our dual brand strategy resulting in year-on-year growth in total container throughput revenue and profit attributable to equity holders. Mr. Zhao will now take you through the financial performance.

Thank you. Dear friends from the media and investors, good afternoon. I will now take you to the second part of our presentation. In the first half of the year, we achieved new results in improving quality and efficiency with both revenue and profits recording solid growth. Revenue increased by 13.6% year-on-year and gross profit increased by 10.3% year-on-year. The company continued to optimize the management and profitability of our equity method investees promoting their coordinated development.

In the first half, profits from joint ventures and associates increased by 13.1%. In terms of net financial cost, we strengthened financial expense control, further reducing financial expenses through measures such as optimizing debt structure. Net financial costs decreased by 14% year-on-year in the first half, demonstrating significant cost control effectiveness. Our net profit attributable to equity holders increased by 30.6%, primarily driven by profits from Guangzhou Nansha Terminal and Tianjin Terminal in the PRD region, which increased by 59.8% and 10.9%, respectively. Overseas, this was primarily driven by profits from Greece PCT and CSP Spain terminals, whose profits increased by 93.8% and 68.6% year-on-year, respectively. Dividend payout ratio remained unchanged at 40% with a dividend of USD 0.01928 per share, representing an increase of 23.6% year-on-year. Now let's look at our revenue and GPM. In the first half, revenue rose by 13.6% year-on-year, while the GP margin was 27.2%. For subsidiary terminals in China, revenue went up by 1.1%, while GP margin was 36.2%. GPM of Xiamen Ocean Gate and Guangzhou Nansha Terminals remained above 40%.

In the future, we will continue to build differentiated and one-stop value-added services at Xiamen Ocean Gate Terminal to promote growth in value and strengthen its role as a regional hub. We will enhance the operating capacity of Tianjin Container Terminal, increase the volume from nearby cargo sources, making it a new hub port for CSP in Northern China. At Guangzhou Nansha Terminal, we will continue to develop the bulk to container change of cargo type to strengthen logistics efficiency and network service capability in the PRD. We will improve Yangtze River and Inland River feeder network, expanding cargo sources from railways in Wuhan terminal, optimizing route capacity allocation, achieving a significant increase in throughput.

For overseas subsidiary terminals, revenue increased by 25.9% with GP margin growing by 3.3 percentage points. The PCT terminal in Greece has handled the unfavorable effects of the Red Sea incident very well, strengthening cooperation with shipping companies to increase throughput and increasing marketing strategies, driving revenue to grow by 27.9% and GP margin rising by 2 percentage points to reach 21.4%, increasing competitiveness. CSP Spain revenue rose by 13.1%. GP margin increased by 1.6 percentage points. We'll continue to focus on consolidating its regional advantages to play a more important role in the land and sea corridor between China and Europe to improve operational performance.

At Abu Dhabi Terminal, we will continue to strengthen marketing strategies to shipping lines within and outside of COSCO SHIPPING Group increased the number of routes and improved operational efficiency, driving revenue to grow by 10.9% and GP margin to increase by 3.5 points. We will also continue to increase the overall competitiveness of Chancay Terminal in Peru while improving operational efficiency. We will also increase marketing efforts. Now let's look at the profit distribution by region. In the first half, terminal profits reached USD 242 million, an increase of 19%. Terminal profits in China reached USD 185 million, up 0.8%. We will continue to integrate into regional coordinated development and enhance the capacity of domestic terminals. while focusing on the coordinated development of the Beijing, Tianjin, Hebei region, the integration of the Yangtze River Delta, Guangzhou, Hong Kong, Macau Greater Bay Area and the new [ Western Landsea ] Channel, we will continue to strengthen cooperation between domestic and international trade routes.

For overseas terminals, profits went up by 187.4%. Profits in the Mediterranean and Middle East region rose significantly by 149.9%, mainly benefiting from the PCT's improved operational efficiency and accelerated container transshipment and throughput rising 4.9% year-on-year and net profit rising significantly by 93.8% year-on-year. The Europe region saw a significant increase of 297.1%, mainly due to CSP Spain, which increased its efforts to introduce new routes and enhance ports reach, resulting in 6.2% increase in throughput and 68.6% increase in profits, driving the profitability of the entire European region. In the future, we'll continue to focus on the Chinese market while taking advantage of the dual drivers of domestic and international markets, focus on global network channel opportunities, expand overseas markets, improve stable revenue growth and continuously optimize our portfolio's profitability.

In terms of the balance sheet, by the end of June, the company's cash and bank deposits amounted to USD 1.28 billion, of which renminbi accounted for approximately 41%, euro 19% and US 37%. Total debt amounted to about USD 3.25 billion, renminbi accounted for about 30%, euro 17%, USD 51%. Capital expenditure in the first half, USD 160 million, about USD 26 million was spent on investments, about USD 134 million was spent on fixed assets, mainly on CSP Chancay and CSP Spain, amounting to about USD 98.9 million and USD 11.7 million, respectively. The net debt-to-equity ratio was 26.7%, and it has been stable at a low level in recent years. In the future, we will continue to capitalize on the advantage of our low leverage and focus on emerging markets with high development potential.

As for the average bank borrowing cost, it dropped to 4.7% during the first half. We strengthened capital planning and management strategies took advantage of our scale and reduce our financial cost as a whole, realizing a decrease of 14% in net financial cost. In the second half, we'll closely monitor changes in monetary policy by major central banks, actively expand banking resources, leverage the company's bargaining power, optimize existing loans, negotiate reductions in existing loan interest rates or replace them with loans at lower interest rates in advance, further reduce financial costs and promote high-quality development of the company's overall profitability. Now let us turn to Mr. Chen.

Thank you, Mr. Zhao, for the detailed introduction about our performance. Dear investors and friends of the media, good afternoon. I will now take you through the operational details. In the first half, our total throughput reached 74.3 million TEU, up 6.4% with an increase in China and also overseas. The total throughput of China terminals reached 56.39 million TEU, up 5.7% year-on-year, mainly driven by the strong growth of the Bohai Rim, Yangtze River Delta and Southwest Coast regions.

In the first half, we expanded the coverage of ports in China, increased the joint marketing efforts of subsidiaries led by the headquarters and improved operational capacity through market expansion, improved operations and smart ports. Total terminal throughput in overseas regions amounted to 17.91 million TEU, up 8.4%. Based on our global route network, we are focusing on enhancing the hub operational capabilities of terminals such as Chancay in Peru, PCT in Greece and Zeebrugge in Belgium, in line with the handling capacity and service requirements of major shipping companies. In the future, we'll continue to improve our network layout and strive to build overseas port hubs. Equity throughput rose 3.8% to 22.88 million TEU. Equity throughput of China terminal rose 1.8% year-on-year to 16.14 million TEU with significant year-on-year increase in the Yangtze and Pearl River Delta regions driven by CSP Wuhan terminal.

In line with the overall trend of inland waterway transportation development in China, multimodal transportation business is expected to see significant growth potential at Wuhan, which is why we have increased our equity stake to full ownership. We continue to deepen the development strategy of the Yangtze River economic belt, leverage the advantages of rail water intermodal transportation. Equity throughput of overseas terminal, 6.74 million TEU, an increase of 8.7%. We will explore further growth opportunities from new routes and shipping alliances and the restructuring and upgrading of the industrial chain, particularly by capitalizing on opportunities such as Asian regional integration, sales cooperation and cross-border e-commerce. The container volume of subsidiary terminals was positive, up by 3.6% with international routes up by 6.6%. Throughput of the company's 9 major subsidiary terminals showed steady growth, benefiting from dual branding strategy, COSCO SHIPPING lines and OOCL contributed significantly higher volumes, up 10.5% and 11.6%, respectively. We actively responded to market changes and route adjustments by innovating our marketing model, continuously introducing new routes, promoting inter-terminal cooperation and striving to attract more routes to its controlled terminals.

As a result, container volume from MSC and other shipping alliances increased by 13.2%, expanding our cooperation with major shipping companies. In terms of ASP, calculated in euros, the company's European subsidiary terminals saw a year-on-year increase of 10.3%, mainly due to the continued strong performance of PCT in Greece and CSP Spain. In the second half, we will actively respond to internal/external market changes, focusing on strengthening domestic and international trade channels, network construction and extended business development while continuing to expand our business scale, optimize cargo structure and increase revenue.

We will establish a diversified global supply chain system through comprehensive products, marketing operations and customer service. We'll strengthen the foundation of port operations through the integrated development of hubs, channels and networks to optimize the structure of our global shipping routes. We are promoting the development of supply chain resources and advancing multimodal transport operations, creating a new global logistics supply chain ecosystem. The following are the results achieved by several key projects. For the Xiamen Haitou CFS project, we will strive to maintain a high usage rate, optimize warehouse space planning at the logistics park, enhance space utilization through centralized management and expand Southeast Asian shipping routes.

Second, at Xiamen Haicang CFS, we'll continue to increase our promotional efforts focused on connecting with leading local enterprises, deepening internal coordination with the group and closely collaborating with Xiamen COSCO SHIPPING lines, logistics and chemical companies to achieve good results.

At Abu Dhabi CFS, warehouse utilization rates approached saturation level. We're building a large-scale logistics project center in the Middle East and the CFS project has obtained Abu Dhabi National Oil Company's full category logistics supplier qualification, becoming the only Chinese company to obtain this qualification. Relying on this, we can provide comprehensive services covering heavy cargo transportation and warehousing, significantly enhancing our competitiveness. At Zeebrugge CFS, we'll continue to explore market opportunities and focus on the construction of sea rail intermodal transport channels by integrating the resources of the terminal and railway stations and leveraging the abundant customer resources of COSCO SHIPPING Group in Europe. We will build an efficient and stable 2-way logistics corridor.

We strengthen the function of the port area as a gateway to Northwest Europe and provide a fundamental channel for business expansion in the Northwest European market. The global port and shipping industry is shifting from single point competition to ecosystem competition. We need to accelerate our leading role in smart port construction continuously promote unmanned container truck operation and achieve economies of scale, strive to achieve improvements in efficiency and scale. To accelerate the integration of cutting-edge technology with port operations, 5 terminals in Xiamen, Chancay, Wuhan, Abu Dhabi and Peru have fully transitioned to commercial scale operations and large-scale application of unmanned container trucks, achieving an average cost reduction of 10% per container. In the first half, the cumulative operational volume of unmanned container trucks reached 530,000 TEUs, representing an increase of 69%.

All China subsidiary terminals as well as CSP Abu Dhabi utilized the EAM system. Since implementation, terminals have deepened application of the system, effectively helping standardize processes and management with cost saving and efficiency-enhancing results. We are also continuously developing AI technology application with the EAM system to further enhance intelligence, efficiency and convenience. Transitioning from traditional operations to a new operational model requires the vigorous promotion of advanced information technologies such as 5G, AI, Internet of Things and cloud computing. We will continue to focus on building replicable smart and efficient modern ports moving forward towards large-scale application and comprehensively forging a new ecosystem.

I will now hand over to Madam Wu.

Thank you very much. Let's take a look at our strategic plan and outlook. As our global portfolio continues to grow, we'll continue to strengthen our network and optimize allocation of resources, accelerate the pace of innovation and improve operational efficiency. First, centered on Belt and Road initiative, achieve new breakthroughs in globalization, we'll focus on our core business and strengthen global hub network and the core roads. We will grasp development potential and opportunities in emerging markets and accelerate our investment in Southeast Asia, South America, Africa and other regions.

Second, we focus on lean operations and improve efficiency. We'll focus on these internal and external synergies to improve our operations. Through flexible commercial terms and differentiated services, we'll seize opportunities brought about by increased demand in transport, continue to introduce new routes and strive to secure additional ship calls. We'll continue to explore new methods of cost control, leverage our scale competitive advantage and explore opportunities for value enhancement.

Thirdly, upgrading supply chains to create new momentum for integrated development. We actively participate in our shipping plus port plus logistics and Hub plus channel plus network integration policies to respond to changes in the value chain and grasp opportunities from the supply chain. We'll continue to develop integrated supply chain logistics services that seamlessly connect shipping routes, ports, terminals and land transportation. We're committed to strengthening innovation and upgrading green and smart ports. We are aligning with the latest development concepts to establish a digital system and completing the implementation plans for the short, medium, long-term development of AI. In terms of green and low-carbon development, we're working together to build a global green transportation channel for post and shipping, driving the industry towards accelerated evolution of zero carbon supply chain.

In the first half, we continue to strive to achieve our commitment to carbon neutrality by 2050 and systematically promote the deep integration of ESG and production and operation management around the 5 pillars of sustainable development, integrity and women cooperation, resilience for the future, agility and innovation, caring for nature and dynamic progress and integration to achieve the 3-in-1 integration of the company and its value chain in the economy society and natural ecology. The company has received high recognition from leading domestic and international ESG rating and index companies, including wind ESG rating of AAA rating from [ Hang Seng ] ESG rating, ranking first in the transportation infrastructure industry and significant reduction in ESG risk exposure with the Morningstar ESG risk score decreasing to 14.8. We will continue to implement sustainable development principles, explore innovative solutions and contribute long-term value to the construction of a digital intelligent and green low-carbon port ecosystem.

Looking forward, we'll actively seize development opportunities adhere to serving market demand focused on emerging markets and regional markets. Especially major regions and markets where major shipping alliances have added new routes and capacity and focus on investing in global resources. Although uncertainty of global economic recovery still exists, our economy has a stable foundation, strong resilience and great potential and the supporting conditions and basic trend for long-term improvement have not changed, helping us to steadily realize high-quality development. As the emerging economies transition from being participants to growth engines, forming more balanced and diversified global economic system, this brings new growth momentum. We will take advantage of new trends of the global economy and trade use our global portfolio as the core development strategy and continue to improve the quality and efficiency of the terminal portfolio while the company's asset scale continues to expand.

We'll also promote the company's high-quality and sustainable development, accelerate progress towards the goal of constructing a customer-centered global leading integrated port logistics service provider. This concludes our presentation about the market conditions and operating performance in the first half. Once again, our dear guests, we would like to express our sincere gratitude to all of you for your continued support. Moving forward, we will closely monitor changes in the port and shipping industry landscape and contribute to the stability of the global logistics supply chain. Through our efforts to enhance operational performance, we aim to maximize value for our shareholders. We'll now proceed to Q&A session. We welcome any questions from you.

Thank you very much for the presentation. We'll start the Q&A. We welcome questions from on-site and also online participants. Please tell us who you are and who you represent.

I'm from [indiscernible] we are quite concerned about [ Quanzhou 's sales ] of the 2 terminals in -- or the 2 ports in Panama. Did you participate in the transaction? What is the progress of that transaction at the moment? Is it possible that concerning the transaction, you will only consider overseas ports other than those in Panama? And what about the U.S. Sino trade disputes? Things seem to be calming down. So does that mean you are looking at more positive signs? What is the outlook for the second half?

Well, thank you very much for your question. There is no comment for the first part of your question, but I can talk about the second part. We have seen some policy fluctuations causing certain impact on stability. In May, concerning the trade negotiations between U.S. and China, they have been progressing well. But the market is also warming up and prices continue to climb until the middle of June. Concerning the tariff initiatives from the U.S., we are going to restructure our global supply chain.

So the composition of our supply chain will continue to be more diversified. Against this backdrop in Asia, the freight costs may be stabilized, facing tariff changes or policy changes on the tariff front from the U.S. We will stay very close to such changes. We will be prudent and stay agile towards demands of our consumers. We will adopt the right initiatives to respond to market changes and make plans well ahead of time. We will also strive to enhance our operational efficiency, increase the stickiness from our customers to confront the uncertainties in the market and ensure our stable development.

Do we have any questions from on-site investors? All right. Perhaps we can take questions from online from Goldman Sachs.

The question is about throughput situation at the ports and looking forward in the second half, some insights from the management.

Concerning second half outlook, I want to tell you that at the moment, when we think about the second half, the overall economy and also shipping business, there will be restructuring at a deep level because of certain uncertainties in the market. IMF in July, in their economic outlook, they believe that the growth -- global growth would be about 4.3%, which is a slight downward adjustment considering the external uncertainties faced by China. With the support of various policies, we believe that domestically, things will be rather stable. And IMF has readjusted its outlook to 4.8% for global growth and China being one of the major drivers behind that.

External trade is still agile with its normal level of tenacity. And we see 2.9% improvement for external trade to EU, Korea and Japan, import and export also showed rising trend. So concerning the global ports throughput level, according to the latest Q2 report, the increase is expected to be at 4.4% and in North America, 10.5% growth and Central Middle East and Southeast Asia will also be single-digit growth, exceeding our expectation. At the same time, major ports throughput in China, the momentum of growth is strong. According to local authority projections, the throughput level, 1.7 -- 170 million TEUs. In the second half, we are approaching the end of a peak period. So we are looking at some rather obvious decline. So for the whole year, global throughput growth will be 1.7%. For Asia and Latin America, between 1% to 2%. Middle East, South Asia will be closer to the mid-range single-digit growth. Up to 2029, 4.3% growth for South Asia and then 2.6% for Africa and 2.5% for Central Asia. So we are talking about the Greater China region with 29 million TEU increase.

Thank you very much for the management's answer. Do we have any on-site questions?

How concerned are you about pressure from the U.S. on trade restrictions and COSCO's port assets globally? And there's been talk recently from U.S. lawmakers that concern about COSCO's port holdings in the U.S. Could you respond to that, please?

Well, we are very concerned about continuous developments in these overseas ports, and we will try to place our focus on these overseas ports assets. We will continue to adhere to our prudent principles and strive to create and maximize return for our shareholders. All along, we have been serving global trade. That is our major responsibility. So around the world, we continue to have our operations in a legal manner, and we have good collaboration with global ports. And we will continue to identify potential investment opportunities so that we can continue to optimize our global port network.

Thank you very much for your concern. There is an online question from HSBC. There are 3 questions in total. We will answer them one by one. First of all, in the first half, domestic and overseas per container revenue level.

Thank you. Well, let me take that question. In the first half, concerning overseas revenue in the European region grew by 10.3%, mainly that is because in European region, we have relied on CPI elements. We continuously optimize our business with shipping lines also because in the European region, we have seen some changes to our business structure, driving up the revenue significantly. So adding those together, the growth reached 10.3% in Europe. For domestic revenue, there is a decline of 1.9% mainly because in some of our terminals, we have been affected by the tariff changes.

For example, Nantong Tonghai Terminal, some of their business has been affected. So the per container revenue also dropped, leading to the overall domestic figure dropping slightly. We'll continue to optimize our business and hopefully bring that up again.

The second question is about first half CapEx and what is the guidance for this year?

Well, I will take that question. First of all, in the first half, the actual CapEx it was USD 110 million. USD 134 million went into fixed assets, concerning terminals such as the ones in Spain and the one in Peru, 90-odd million, and they are the major ones. And then about equity investment, USD 20-odd million. Concerning the whole year, we have made adjustments in midyear about the projection, which is USD 790 million. And that is again divided into 2 parts: investment in fixed assets, USD 600-odd million, mainly on major terminals. For example, the ones in Xiamen, Peru, Spain, Abu Dhabi, et cetera. The other part is about equity investment, USD 179 million.

The final question is about the freight volume. Has that been absorbed already?

Well, allow me to take that question. Actually, we can see in May, there was this wave which was rather prominent. Now demand is cooling off gradually. So the freight cost is slowly coming down. If you look at our port situation and operations in July, actually, we are talking about an increase of 3.9% compared to May and June. This is also a declining trend. If we look at the overall external situation, our projection is Q3 global container business will drop by 0.8%. For Q4, the year-on-year decrease will be about 1.7%. The parent company based on the operation in July and August, we -- it is actually in line with the overall projection.

Okay. Any other on-site questions?

I'm Charles. I have 2 questions. First of all, looking ahead, do we have any plan to acquire any ports in what region? And then what about AI and automation facilities at our ports? What is the application situation? What are your future plans?

Yes. I will take the first question. At the moment, we are propelling forward a Thailand project towards the end of September, the transaction will be completed. It will be delivered. And we will look at the overall global situation. And in terms of our global network planning, we will focus on Southeast Asia, South America and also Middle East.

Your second question is about AI projects. Overall speaking, the company at the moment is focusing on unmanned trucks. In Xiamen, [indiscernible] ,Wuhan, Quanzhou and Abu Dhabi and Peru, Chancay ports, we have already launched such automated initiatives. In the second half, concerning unmanned trucks, we are talking about a growth of 69% overall up to 530,000 TEUs. We will continue to participate in the construction of smart ports.

At the moment, Tianjin TCT terminal through the association, we are receiving a 4-star level smart port status. In fact, AI is showing some clear trends. So other than unmanned trucks, on other AI technologies and applications and automation, we have achieved good results as well. Under our large model construction, we continuously optimize and develop the AI application. So hopefully, in terms of servicing our customers and risk prevention, we can make a real difference. At the moment, we are also looking into AI projects such as maintenance and repair on a smart basis for our facilities and equipment so that we can improve our inspection. As for security and prevention of risk, we also have certain smart projects. We also focus on better utilization of our assets so that we can achieve greater synergy through the use of AI prediction. At the moment, projects -- these projects are underway. And we also have other data-related projects. We hope to have better monitoring in terms of low carbon and greening initiatives.

Another question from our on-site investors.

My name is. I have 2 questions. First, is about advanced delivery. Normally, towards the end of every year before Chinese New Year, for sea freight, there will be some risk because everyone is rushing to complete everything before Chinese New Year. In the first half, we see a rather substantial amount of advanced delivery. So towards the second half, do you think that peak will emerge again? Second question is about overseas acquisition plans. Right now, the U.S. is launching equivalent tariff. And Southeast Asia, the tariff is also increasing. So I think that is, in general, affecting the trade situation. So when it comes to tariff measures and geopolitical uncertainties, are they going to obviously affect your acquisition momentum overseas?

I will take the first question concerning the second half, especially Q4. As Ms. Wu has explained earlier, we are being affected by the equivalent tariff measures. In May to June this year, we saw this peak. Everybody wanted to leverage on the opportunity for export due to policy changes and also because of inventory clearance needs, we believe the entire market will see a higher level in the first half, and it will come down gradually in the second half. So I believe things will begin to decline towards the second half.

I will respond to your second question. When it comes to tariff, it keeps changing and even up to today, no one really knows what will happen at the end. We can see perhaps in the second half, perhaps in terms of volume, it's hard to predict a very obvious peak or the traditional peak. Well, many things are happening. We understand China's export to U.S. is dropping, but to other emerging markets, Southeast Asia and also Central and Southern America and Africa, they are on the rise. So because of that, we believe that when it comes to trade and the entire supply chain, they are rationalized and diversified. So we can still grasp the development opportunities there.

And our overall overseas investment plan, just like what you have asked, we will focus on Southeast Asia, South America, Middle East and other emerging markets. We think we still have plenty of opportunities and potential for development.

Thank you. Another question from [indiscernible] analyst.

What do you think about the Red Sea incident? How does that affect the company?

Concerning the Red Sea crisis, we see that since the emergence of the conflict, things have been changing continuously and things continue to evolve so that can we return to the Red Sea waters. How do we make the changes under so many uncertainties. So far, we can observe there is no larger shipping lines returning to the Red Sea routes, but we do see some rewarming for some routes. So we will continue to coordinate with other shipping companies to support route adjustment. Concerning Red Sea incident or crisis and other conflicts, we'll continue to come up with relevant initiatives and plans.

Do we have further on-site questions? Perhaps we will take another question from online participant from [ UOB ].

The question is about coastal ports. In Q2, Abu Dhabi and Spanish ports, the reasons behind the performance, Xiamen, Abu Dhabi and the one in Spain would be his focus.

Thank you. I will take that question. In the first half of the year, Xiamen Coastal ports, we have seen a slight increase of performance by 0.9%. Inside there, there is one factor at Xiamen Port, the routes from U.S. is still taking a bigger proportion. But of course, Sino-U.S. conflicts are causing certain pressure on Xiamen. So it started off with a suppressed level.

Later on, there was cooling off of the conflict and temperament. So Xiamen saw a quick rise in their business level. So while it was affected at the beginning, we ultimately see a small increase.

The second one was which one again, Abu Dhabi?

Yes.

Concerning Abu Dhabi, similarly, there are 2 factors. First of all, as we all know, [indiscernible] invested in Abu Dhabi port. They have started operations. So gradually, business got transferred to their self-operated port affecting us to a certain extent. But our company has adopted dual branding strategy, and we have our own support and effort. And at the same time, we expanded other shipping alliances, including our Twin Star Premium. So for these businesses, supplementing our operations, if you remove the factor coming from the transfer for Abu Dhabi Port, in fact, the year-on-year increase is actually 17.7%. So that is excluding that one factor, you can see that we're doing very well.

For Port in Spain, in the first half, our growth was 6.2%, mainly because of certain attached routes supporting its overall development.

Thank you very much. Do we have other on-site questions? Perhaps we'll take another one from online from [indiscernible].

The question is the supply chain, while we are looking at balanced development. What do you think about global shipping business? And do you have any special measures to tackle it?

I will respond to that question. As we can see, because of external environment is changing and affecting us, major shipping companies, they have adjusted their routes with major changes. I think you all know [indiscernible] the Twin Star Alliance, they have used this model to serve small to medium-sized ports. MSC and Premier collaboration to satisfy the owner of the cargo, which focus mainly on stability and continuity. So transportation mode is now becoming more diversified. So we can see diversified aspirations and personalization needs. These are the new trends. So concerning port operations, after adjustments are made to the routes, our ports have gone through some important restructuring as well. I expect there will be continuous impact.

First of all, concerning the status of hub ports, they may be affected. So concerning our port operation, it is about maximization and how to turn things around more quickly because the aspirations are increasing. We do face certain risk, and we have to rely on regional trade to support our port operations. So at different ports because of different status, we have to focus on differentiated competitiveness. From the company's perspective, restructuring will bring forth new opportunities, and we will continue to share with you. Together with MSC and other shipping companies, we have collaboration. We have identified new opportunities and the port throughput increase has been supported by such collaboration as well. We also have our parent company and also the alliance support. We are well backed by the biggest alliance in the world. So earning a lot of trust from our customers. We will enhance the level of synergy so that we can completely enhance our capability of our port operations.

Thank you. Because of time constraints, let's take the final 2 questions. Do we have further questions on site?

I'm from [indiscernible]. I would like to understand your financial capability. You talked about overseas acquisitions. You will have this global plan. So how much are we talking about being put aside for acquisition? Will you rely on support from your parent company? Secondly, can you talk about overseas acquisition compared to 6 to 12 months ago is more difficult now. So what are the difficulties?

I will take the first question. Concerning our strength, our capability, this is what we think. If you look at our cash reserve and also our scale, they are well aligned. At the moment, our cash reserve and bank loan level are both sufficient. Our total debt, USD 3.2 billion. So net debt level is only USD 90.5 billion compared to the overall scale of the company, that is a very healthy level. If you look at other financial indicators of the company, net debt takes up a very small proportion of our total equity. It's only 26.7%. And our equity debt ratio is only 42%, again, very healthy, and we are well supported for any potential acquisitions or expansions.

I think I am able to answer the first part. And the second part, well, I can give you one example. Concerning the second question, if you look at our global strategy, we are planning to improve our foothold around the globe. We will continue to identify potential port opportunities. But in fact, at the moment, in terms of overseas investment, we are facing a lot of restrictions due to domestic or local policies. They don't just target Chinese enterprises. But for any type of investment, we are subject to the local rules and legal restrictions. For example, investigation concerning anti-monopoly.

And other than the policy front, for mature ports compared to emerging ports in recent years, you may already know, for the port and shipping industry, there are many terminal operators concerning external expansion, they have been rather aggressive in the tendering process, they would submit very high bids. So that caused certain pressure on the company. We have to reasonably assess the viability of our investment to ensure such investments in terms of their return and other indicators will create long-term return to the company.

Sorry, the person speaking is not using a mic. There is no answer. No comment. I should say that is outside the scope of today's presentation. We have many, many online questions. So the next one is from an analyst.

In the first half, your profit is very good. What measures have driven it up? And what about the second half outlook?

This is the situation. If you look at the performance of the first half, our productivity indicator and financial indicator, they both performed rather well. So while we faced many challenges for the port and shipping industry, in general, things have been complicated and ever changing and the global economy presented so many uncertainties. Still, in recent 2 years, while we have been affected, for example, trade protectionism and regional conflicts, all of these factors have created clear pressure. In order to control and prevent such risks and alleviate such adverse impacts on us, we have deepened our operations management. We continuously optimize our allocation of resources and optimized our processes to enhance the overall tenacity of our operations.

So we can look at this on 2 things. In terms of operations, our total throughput increased by 6.4% because productivity has been greatly enhanced. Our revenue also rose by 13.6%. Gross margin also improved. And if you look at our financial performance through a number of measures and cost control to suppress financing cost, what we have done has shown rather prominent results. In the first half, net financing cost dropped by 14%. If you look at our measures on both fronts, concerning optimization in the first half, our financial results, especially for attributable profit increased by 30.6%. So among this, in PRD region, Guangzhou, Nansha, Yantian ports, the profits increased by 56.8% and 4.9%. For Spain, our profit went up by 68.6% or very good performance.

This is the end of today's presentation. Thank you for your long-term support and concern. If you have further inquiries, please contact our PR team.

[Statements in English on this transcript were spoken by an interpreter present on the live call.]