Cyprus – Ship Management Survey for the first half of 2019

The Central Bank of Cyprus has published the results of the Ship Management Survey for the first half of 2019. The main developments concerning the transactions of resident ship management companies, are summarized as follows:

1. SHIP MANAGEMENT REVENUES FROM NONRESIDENTS

Cyprus’s ship management revenues declined slightly by 0,95% during the first half of 2019 (2019H1), closing at €523 million (Chart 1) and corresponded to 4,9% of Cyprus’s GDP (as turnover), which was also the case in the previous two periods.

2. SHIP MANAGEMENT SERVICES

Chart 6 provides a tree diagram of the industry’s revenues, with analysis by type of ship management service and country of payment. Ship management services encompass crew, technical and full management operations, and accounted for 83% of the industry’s revenues during the period under review, which is 9% higher when compared with the previous period.

3. COUNTRY PORTFOLIOS

Companies managing between 1 and 5 ships accounted for 46% of ship management companies but generated only 3% of the industry’s revenues. The average company market share in this group was 0,2%. Companies managing between 6 and 20 ships accounted for 20% of ship management companies, generated 9% of the industry’s revenues and scored an average share of 1,3%. The last two segments (21-40 and >40) correspond to companies with a higher number of managed ships per period. Specifically, 20% of these companies managed between 21 and 40 ships during 2019H1 and claimed 39% of the industry’s revenues. A large number of ships (in excess of 40) were managed by only 14% of the companies but accounted for 49% of the total revenues. The average market share in this group was 9,8%.

4. SHIP MANAGEMENT EXPENSES

Industry expenses increased to €442 million in 2019H1. The majority of these concern crew expenses, which accounted for 64% of the total amount in 2019H1. Most of these payments were directed to non-EU seafarers (45%). Administration expenses accounted for 12% and ship management expenses (e.g. spare parts, lubricants, dry-docking, etc.) for 24% of the total amount.

The Ship Management Survey is conducted biannually by the Central Bank of Cyprus’s Balance of Payments Section, which is part of the Statistics Department.  The survey was launched in March 2009 and covers residents of Cyprus who provide ship management services to ship owning companies registered both in Cyprus and abroad.

The survey collects data from a representative sample on the financial transactions (revenues and expenses) carried out between resident ship management companies and non-residents of Cyprus. In particular, the survey requires, among other things, the submission of:

  1. Revenues by type of service provided to non-resident ship owning companies.
  2. Revenues received from non-resident ship owning companies, by country from where the revenue is derived.
  3. Revenues by country of flag registration of the ships, whose management is performed by the resident ship management companies.
  4. Revenues by country of residence of the ship owner, whose ships are managed by the resident ship management companies.
  5. Payments made by the resident ship management companies, by country of residence of the recipient.

The results of the survey include additional economic analysis, such as:

  • Size of the ship management industry as a percentage of Cyprus GDP.
  • Level of concentration in the industry.
  • Size of the client portfolios of the ship management companies.
  • Percentage of resident ship management companies which operate in different countries (analytically by country).
  • Magnitude of total expenses in the industry.
  • Identification of countries which offer market opportunities for further revenue growth.

To view the report on the 1st of 2019, click on the image below.

Source: Central Bank of Cyprus

 

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