KUCHING: Hubline Bhd
, which is involved in dry bulk shipping, expects to acquire another barge this year under its ongoing fleet renewal and expansion programme.
In financial year 2022 (FY22), the company acquired one newly registered tugboat and one new barge after disposing of two sets of ageing tugs and barges.
In FY23, another new barge was added to the fleet, bringing the company’s total to 21 sets of tugs and barges that ply routes in South-East Asia.
Hubline provides barge logistics services of between 8,000 tonnes and 12,000 tonnes of cargo per shipment.
“As planned, our ongoing fleet renewal and expansion programme continued to perform well and within expectation, similar to prior years.
“Our programme continues to see the introduction of a new barge each financial year, with consideration for a further new barge, assuming steel pricing and shipyard availability are in our favour,” Hubline management said its 2023 annual report.
Hubline said each new barge is able to load 10,000 tonnes of cargo at maximium capacity per voyage, thus allowing the company to maximise gross revenues while achieving greater economies of scale despite the high initial capital outlay on the new barge itself.
“Maintenance and steel plate upgrading is also heavily reduced for these newer barges, giving us immediate savings in the short term while aiding us in bringing down the average fleet age.
“Lowering its fleet age has both the added benefits of a reduction in maintenance outlay as well as reducing our overall insurance premium on sums insured,” added the company.
In the financial year under review, Hubline’s top two categories of barge cargoes were coal and gypsum. The most commonly executed trade was coal from Indonesia to Vietnam.
“Coal consumption continues to drive the overall commodities market in terms of barging logistics, with demand continuing to flow strongly into the opening of the 2024 financial year.
“Going forward into the FY24, we expect our barge logistics business to continue to perform well, and expect another strong year off the back of FY23.
“Vietnam will continue to be the market leader as far as coal by barge imports are concerned. On the other hand, Indonesia will continue to be the largest exporter of coal by barge in the region and largest importer of gypsum by barge.
“Thailand will continue to be the sole gypsum exporter by barge in the region,” said Hubline.
In FY23, Hubline, whose other core business is in aviation, posted group after-tax profit of about RM6.1mil on revenue of RM234.1mil compared with RM11.3mil on reenue of RM228.4mil in FY22.
The shipping segment’s revenue fell by RM2.55mil to about RM142mil from RM144.5mil in FY22 due mainly to subdued freight rates but the aviating segment’s revenue grew by about RM8.2mil to RM91.8mil from RM83.7mil in FY22.
However, the group expects freight rates to rebound in FY24.
Hubline said the group would continue to pursue better margins and alternative routes, which include the Philippines, Cambodia, Peninsular Malaysia and Thailand, to support the Vietnam trade.
“We will continue to pursue and secure whichever cargo best elevates our market position in the industry within the South-East Asian region, and target the sectors that create the best routing efficiencies, with a higher focus on profitability as well as economies of scale.
“Our approach will continue to be methodical and measured as we are acutely aware that we have enjoyed strong demand in our industry for the previous two years, with expectation of strong demand in a third consecutive year,” it added.
On the group’s aviation business via subsidiary Layang Layang Aerospace Sdn Bhd, Hubline said the regional charter airline currently owns a fleet of 26 fixed-wing aircraft and helicopters, three of which were acquired in FY23.
Layang Layang Aerospace’s primary operational bases are located in Kota Kinabalu, Sabah and Ipoh, Perak, and its operations cover the main towns of Sarawak and Sabah as well as Labuan.
During the year under review, Layang Layang Aerospace secured and implemented several new aviation contracts, including flying doctor and emergency medical flights, time-charter aviation services, search and rescue operations, as well as logistical support for ancillary health services.
Additionally, Layang Layang’s operations include providing calibration services for navigational instruments, aerial photography and aerial survey.
Layang Layang Flying Academy, one of Malaysia’s approved flying academies, specialises in the comprehensive training of both fixed-wing and helicopter pilots.
“Looking ahead, we remain steadfast in our commitment to augment student enrolments by executing marketing campaign aimed at promoting the diverse courses offered by our flying academy.
“Moreover, we are actively engaged in expanding our training services.
“This includes enhancing the skills for current pilots, focusing on training for aerial upset prevention, stall recovery, and specialised training for search and rescue operations,” added Hubline.
