COSCO PACIFIC LIMITEDEmily VandenbergheMr. ApplinAccounting – 42 April 2012

General Information

COSTCO Pacific’s Headquarters is in Hong Kong.

It is a state-owned enterprise (Red chip).

“Our vision is to transform our business model by becoming a leading global port operator and by focusing on ports as the principal earnings driver.”

Background

COSCO Pacific was founded in 1994. It’s industry is container leasing. It’s parent company established

COSCO Pacific due to the companies growth.

The company is comprised of more than 1,000 employees all over the world.

Corporate Structure

Source of Income

COSCO Pacific is mainly engaged in container terminal operations, container manufacturing and leasing, shipping agency and freight forwarding. COSCO Pacific is the fifth largest terminal

operator in the world and a leading terminal operator in China.

COSCO Pacific Ltd. had revenues for the full year 2011 of $599.2M. This was 34.2% above the prior year's results.

Terminal Operator

COSCO Pacific is the flagship of China Ocean Shipping (Group) Company for terminal business with wide-ranging terminal network and port portfolio in both China and overseas. throughput growing a compound annual grower

rate of 12.9% for the past five years. COSCO Pacific has investments in overseas

container terminals such as Singapore, Antwerp in Belgium, Port Said in Egypt and Piraeus Terminal in Greece.

COSCO Pacific has 27 joint venture terminal operations.

Container Leasing, Management and Sales Florens Container Holdings Limited, a wholly owned

subsidiary of COSCO Pacific, and its subsidiaries, operates container leasing and management business for the Group.

Florens is the second largest container leasing company in the world with 1.63 million TEUs fleet size as at the end of 2010 It maintains a high utilization rate that is above

market average. While continuing to focus on long-term leases,

Florens is also aiming to expand market share by striking an optimum balance between ownership and management of its container boxes based on an “asset light” business model.

Worldwide Network For Container Leasing, Management and Sales

Container Manufacturing

COSCO Pacific holds an approximately 21.8% equity interest in China International Marine Containers (Group) Co. (CIMC).

CIMC is primarily engaged in the manufacturing and sale of modern traffic and transport equipment.

It is the largest container manufacturer in the world in terms of annual container output and sales volume.

Container products range from dry, reefer, tank and various special containers.

Income Statement Evolution

Stock Price History

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009Highest share price (HK$)

7.750 7.950 7.900 6.850 7.050 10.750 16.200 17.900 18.650 26.850 20.949 13.780

Lowest share price (HK$)

1.720 2.050 4.100 3.125 3.975 5.850 8.200 12.150 14.200 16.580 3.200 5.250

Average share price (HK$)

4.240 5.301 5.804 4.752 5.679 8.334 11.851 15.277 16.369 20.810 11.987 9.580

Orange: Closing price on Dec. 31st

Blue: Market Capitalization

Stock Prices

The current stock price is 11.58 +0.14 (+1.22%)

The high is 11.59 The low is 11.41 According to the previous chart,

26.850 was their record high and 1.72o was their record low.

Dividend

According to investopedia.com, dividend is a distribution of a portion of a company's earnings, decided by the board of directors, to a class of its shareholders.

COSCO Pacific’s current dividend is 5.80%

Dividend History

   Blue: Total (US cents)             Orange: Payout ratio (Full year) (%)

Strengths of the Company

COSCO Pacific operates all over the world and is given many opportunities to grow. This allows the company to meet with new investors

and gain profit. COSCO Pacific has always regarded investor

relations as an important aspect of corporate governance. As such, their investor relations team sets out to

provide an efficient two-way communication channel between senior management and investors.

In addition, they release information according to standards higher than those of the disclosure regulations governing the Company's listing.

Weaknesses

Share price rallies, combined with a renewed downturn in momentum, means they have become more negative on container shipping in the short term.

Longer-than-expected slowdown in global trade that causes a derating of the port sector. Any delay in a turnaround of the company’s recent investments could also pose a downside risk to their earnings and valuation.

COSCO Pacific’s stock prices have decreased by over half since 2007.

Opportunities

The rapid economic growth in China will give a huge advantage to COSCO Pacific. It will allow the company to expand and gain new

investors. “Our key strategy to capture terminal

investment opportunities is to further strengthen our carrier-terminal partnerships with other port operators and major liner operators.”

COSCO Pacific’s continued focus on the environment and community will allow the company to connect with the people and show them that they care about the world.

Threats

Container shippers have had the weakest momentum within the transport sector. Generally, weak earnings momentum for the liners is another short-term share price risk.

Container manufacturing business faces some near-term risks.

New companies continue to rise, threatening COSCO Pacific’s dominating position.

Awards and Recognition

2011 - Won the "Best Investor Relations in Transport Sector" and "Best Overall Investor Relations by a Hong Kong Company" by IR magazine.

2007 - Included as one of the Top 10 Enterprises by China Shipping Gazette.

2003 - Rated one of the best corporate governance of Chinese companies by CLSA for the third consecutive year.

2000 - Ranked No.7 in best investor relations and No.3 of the best financial management in China in the poll of "2000 Best Managed Companies in Asia" by Asiamoney magazine.

Etc.

Recommendation

I would recommend purchasing stock from COSCO Pacific. Though the price is not at a current low,

the stock continues to rise for the company and it would be wise to invest in it before it reaches it’s high again, then sell it at that point in time.

Works Cited

http://www.coscopac.com.hk/eng/aboutus/company_profile.php

http://www.glassdoor.com/Overview/Working-at-COSCO-Pacific-EI_IE37715.11,24.htm

http://www.coscopac.com.hk/admin/upload/ir/financial_report/ear2010_13.pdf

https://www.research.hsbc.com/midas/Res/RDV?p=pdf&key=Crs9nSep3V&n=317572.PDF