Cyprus ship management revenue declined by €39 mln to €484 mln in the first half of 2020, reflecting the negative impact of the coronavirus pandemic on the shipping industry.
According to the ship management survey conducted by the Central Bank of Cyprus, revenue from ship management declined by 7.5% (€39 mln) compared with the first half of 2019.
When compared with the second half of 2019 the reduction was a steeper 16.7% (€97 mln).
Ship management revenue amounted to 4.8% of Cyprus GDP, almost unchanged from a year ago (4.9%).
Global shipping was severely affected by lockdowns, suspension of business operations and travel restrictions imposed to contain the spread of the pandemic.
Passenger ships took the heaviest blow, while the impact was relatively smaller on merchant shipping.
“This negative development is also reflected in the revenues of the various segments of the Cyprus shipping industry,” the CBC said.
It said even though uncertainty prevails in the economic environment, a rebound should be expected once COVID restrictions have been removed.
Germany, traditionally the ship management sector’s largest market, increased its contribution of ship management revenue to 47% in the first half of 2020 while revenue from Greece rose to 9% with Singapore ranking third with 7% of the total revenue.
In contrast, there was a decline in the share of revenues from Switzerland, Malta and Norway.
“The 2020H1 results suggest that 29% of the companies managed to generate revenues in the range of €5 – €25 mln each, while only 25% of the companies managed to generate revenues in excess of €25 mln,” said CBC’s ship management report.
Revenue from ships registered in Cyprus rose to 42%, compared with just 3% in the second half of 2019 while revenue from ships registered in other countries amounted to 58%, the survey said.
Core ship management services (which encompass crew, technical and full management operations) accounted for 81% of the industry’s revenues.
“Germany remains the most important source in this segment, with a contribution of 52%, followed by Malta with 8%.”
The industry’s expenses in the first half of 2020 amounted to €423 mln marking a reduction of 4.3% compared with the first half of 2019 and by 0.9% against the second half of 2019.
Crew expenses amounted for 54% with 22% of expenses channelled to administrative expenses and 24% for ship management expenses.