Jinhui Shipping and Transportat

Income statement

The FY2021–FY2025 revenue CAGR is about 4.7%, from USD 131.0 m to USD 157.5 m.

Quarterly progression (USD m)

Sources: Q1 2025 presentation (EBITDA "USD 35 million", EPS 0.156); Q2/H1 2026 report; Q3 2025 presentation; FY2025 release; Google Finance (Q1 2026 revenue). Q1 2025 revenue and net profit are derived as H1 minus Q2. Q1 2026 EBITDA is derived as H1 2026 EBITDA (33.7) minus Q2 (16.8). Q1 2026 net profit is derived as 9.593 minus 5.269.

Commentary.

FY2021–FY2023 cycle: Results tracked the dry bulk cycle. The FY2021 boom produced exceptional earnings. FY2022 revenue held up, but net income fell slightly negative. FY2023 revenue roughly halved to USD 81.9 m with a USD 55 m loss as rates normalised and vessel impairments were booked (TradeWinds).

FY2024 inflection: Revenue roughly doubled to USD 158.9 m. Per vendor summaries, 9M 2024 revenue doubled to about USD 115 m. Two drivers stand out: a larger operated fleet built through acquisitions and long-term charter-ins, and a recovery in rates.

FY2025: Revenue was flat at USD 157.5 m and EBITDA rose to USD 79.1 m. The EBITDA increase was flattered by the USD 20.2 m one-off charterparty settlement in H1 2025. Net profit halved to USD 12.5 m because of the USD 9.2 m loss on the eight Supramax sales and heavy right-of-use depreciation on long-term charter-ins.

H1 2026: Revenue fell 13% to USD 69.3 m because the fleet shrank from 32 to 21 vessels. Underlying profitability improved materially, however. TCE rose 27% year on year to USD 17,150 per day (the company cites about 30%). Owned-vessel running costs fell to USD 5,509 per day from USD 6,044. Depreciation fell to USD 20.4 m from USD 30.0 m as charter-in leases expired. H1 net profit of USD 9.6 m contained no one-off settlement, against H1 2025's USD 15.1 m, which included USD 20.2 m of settlement income.

Balance sheet

Source for FY2025: Q2/H1 2026 report (31 December 2025 comparatives) and FY2025 release (primary).

Latest balance sheet point, 30 June 2026 (primary): cash and cash equivalents USD 13.8 m; total liquidity (cash plus securities) USD 70.6 m; FVTPL portfolio USD 44.1 m, of which USD 30.6 m is equities and funds and USD 13.5 m is FCNs; secured borrowings USD 98.3 m. Repayment profile: 10% within 1 year, 68% in year 2, 9% in years 3–5 and 13% after year 5. Borrowings are floating rate and denominated in HKD and offshore RMB. Gearing was 7%, working capital positive, and the co-investment loan receivable USD 3.3 m.

As an indicative cross-check only, the vendor P/B of 0.16x (Parqet) against a market capitalisation of about EUR 67 m implies book equity of about EUR 420 m. This is not a primary figure.

Net debt. At FY2025, secured borrowings of USD 114.9 m less liquid assets of USD 110.9 m gives about USD 4 m before lease liabilities, consistent with the company's 1% gearing. At 30 June 2026 the same calculation gives about USD 27.7 m before leases, consistent with 7% gearing. The rise reflects newbuilding instalments (USD 19.3 m in H1 2026), debt repayment and the reinvestment of cash into FCNs.

Cash flow

Source: Q2/H1 2026 report (primary). Free cash flow on a simple OCF-minus-newbuild-capex basis was about USD –12.8 m in H1 2026 (analyst-derived) and is expected to stay negative while the 12-ship programme is paid for. No share buyback programme was identified.

Dividends per share (cash dividends declared for the fiscal year)

Sources: FY2025 release (USD 0.018 proposed); Börsdata/MFN calendar (ex-dates 28 May 2025 at NOK 0.34 and 28 May 2026 at NOK 0.17). No interim dividend was declared for Q2 2026.

Ratios

Indicative points derived by the analyst:

Net debt / EBITDA (FY2025): About 0.05x on secured debt net of liquid assets, before leases.

Interest coverage (H1 2026): EBITDA of USD 33.7 m against finance costs of USD 3.7 m gives about 9x.

Cash conversion cycle: Not meaningful for a time-charter owner; hire is paid in advance.

Management guidance. No quantitative guidance is given. Management's qualitative message is to keep renewing the fleet, keep a competitive cost base and balance long-term charters with spot exposure. It points to geopolitical disruption as structural rate support in 2026 (H1 2026 report).

Consensus. No consensus estimates exist.

Bull case

1. Rate leverage. H1 2026 TCE of USD 17,150 per day was up about 27–30% year on year while opex fell to about USD 5,500. Every USD 1,000 per day of TCE on about 18–21 vessels adds roughly USD 6.5–7.5 m a year to EBITDA (analyst estimate).

2. Valuation. About 0.16x book value and an FY2025 EV/EBITDA of roughly 1.5x with negligible net debt leave asymmetric upside if the discount narrows. Insider buying (June 2026) supports this.

3. Fleet renewal. The renewal turns an ageing Supramax fleet into 12 modern Ultramaxes priced near market (USD 33–34 m against Clarksons' USD 34.5 m), adding capacity from end-2026.

Bear case

1. Rate collapse risk. Rate strength is geopolitically driven. A de-escalation in the Gulf could return TCE toward the Q2 2025 level of USD 13,860, where Jinhui was loss-making.

2. Capex strain. Roughly USD 405 m of newbuild commitments against USD 70.6 m of liquidity, falling cash and 68% of secured debt maturing in year two raise funding and refinancing needs, while dividends have already been cut.

3. Governance discount. Family control, low independence and profits eroded by non-core holdings (FCNs, equities, Shanghai property) may keep the valuation discount permanent.

Catalysts and monitorables for the next 12 months

• Q3 2026 results (about 30 November 2026), FY2026 results (about 26 February 2027) and the FY2026 dividend decision.

• Delivery of the first Hantong Ultramax (due by 31 December 2026) and its charter employment.

• Completion of the second 2026 disposal (Q3 2026), plus any further sales or acquisitions.

• Refinancing of the year-two debt maturities.

• BDI direction against Middle East and Hormuz developments, and US–China trade and port-fee policy.

• Any buyback, take-private or other parent action given the P/B discount.

• FCN and equity portfolio marks, and recovery of the Shanghai loan receivable.

Analyst verdict. Jinhui Shipping and Transportation is a family-controlled dry bulk owner whose financial position is far stronger than its market valuation suggests. After the FY2023 loss, management rebuilt profitability: revenue of USD 158.9 m in FY2024 and USD 157.5 m in FY2025, EBITDA of USD 74–79 m, and positive earnings in both years. It did this while keeping net gearing near zero.

The company then started a decisive fleet renewal. It sold eight aged Supramaxes in 2025, accepting a USD 9.2 m book loss, and committed to 12 fuel-efficient Ultramaxes for delivery between 2026 and 2030. Execution so far has been disciplined. Contract prices of USD 33–34 m are at market, owned-vessel opex has fallen about 20% to about USD 5,400 per day, and TCE has risen about 30% to USD 18,015 per day as the Arabian Gulf conflict disrupted trade.

The investment debate centres on cyclicality and capital allocation rather than solvency. The fleet is temporarily small at 21 vessels, so revenue is falling even as rates rise. The newbuild programme will absorb cash for four years. Liquidity has already fallen from USD 110.9 m to USD 70.6 m, and a large slice of debt matures in year two. Reported earnings are also blurred by treasury activity: FCN and equity marks, and a Shanghai property stake now written to nil. These sit uneasily with a pure shipping proposition and help explain the persistent discount, which is reinforced by a controlling parent and a family-dominated board.

Our assessment is that Jinhui offers deep-value, high-beta exposure to dry bulk rates with a strong balance-sheet floor. Without sustained rate strength or a shareholder-friendly catalyst, such as buybacks, a higher payout or a parent take-private, the discount is likely to persist. Monitoring priorities are newbuild financing, deliveries and the durability of 2026 freight-rate support.