SITC International has released 3Q26 operating data and declared a special dividend. Revenue rose by 21.6% YoY but fell by 9.7% QoQ to USD970mn, among which container volume grew by 2.2% YoY but dropped by 15.8% QoQ and revenue per TEU rose by 21.5% YoY and 3.1% QoQ. The QoQ volume decline reflects seasonal weakness and typhoon-related port congestion, which slowed vessel turnaround. Higher freight rates came from solid export demand and geopolitical risk premium. For 9M26, revenue reached USD2.81bn, up by 14.2% YoY. The company has also declared a special dividend of HKD1.0 per share, which we think underscores its strong earnings and shareholder returns. For 4Q26, we expect volume and freight rates to rise both YoY and QoQ on peak-season demand in Asia and ongoing geopolitical disruptions, lifting the full-year results. Maintain BUY.
Container shipping boom with freight rates rise
For 3Q26, revenue per TEU rose by 21.5% YoY and 3.1% QoQ to USD865/TEU, extending the uptrend. For 9M26, average revenue per TEU rose by 9.4% YoY to USD826/TEU. The YoY increase reflects strong export demand, Middle East disruptions, and port congestion from extreme weather, which slowed vessel turnaround and tightened effective capacity. For 4Q26, we expect freight rates to rise further both YoY and QoQ on peak-season demand in intra-Asia markets. For full-year 2026, we forecast average revenue per TEU of USD849/TEU, up by 12.7% YoY.
3Q volume held up in the off-season; 4Q to rebound QoQ
For 3Q26, container volume reached 940k TEUs, up by 2.2% YoY but down by 15.8% QoQ. YoY growth reflects solid intra-Asia trade demand, while the QoQ decline reflects the traditional 3Q off-season and typhoon-related port congestion. For 9M26, volume reached 2.91mn TEUs, up by 5.9% YoY. For 4Q26, we expect a sharp QoQ rebound on seasonal peak demand. For full-year 2026, we forecast volume of 4.02mn TEUs, up by 4.5% YoY.
Special dividend underscores operating performance and commitment to shareholder returns
The company has declared a special dividend of HKD1.0 per share, payable on 17 December 2026. Combined with the interim dividend of HKD1.5 per share, total declared interim and special dividends reach HKD2.5 per share. Given strong 2026 operating performance and the special payout, we expect the full-year payout ratio to reach 85%, highlighting robust earnings, ample cash flow, and a continued commitment to shareholder returns.
Lift earnings forecasts and target price to HKD53.40; maintain BUY
Given the strong 9M26 operating results and tight container shipping market conditions, we slightly raise our freight rate assumptions and lift our 2026/2027/2028 net profit forecasts by 6/1/3% to USD1.5/1.2/1.2bn. We raise our target price by 3% to HKD53.40, based on 12.3x 2026E PE (three-year historical average PE plus 3SD; the premium reflects strong demand and geopolitical disruptions driving freight rates higher; previous: 12.7x 2026E PE). Maintain BUY.
Risks: geopolitical risks; lower freight rates than we expect, and weaker demand than we expect.