The Application Of EVA In The Performance Evaluation Of Chinese Port Public Companies

Over twenty years after the reform China has kept fast growth, especially in the import and export area. Now China has become the third biggest trading country in the world. The development of international trade brings both the great development opportunities and the unprecedented challenge to our port companies, which have to improve their performance in order to meet the need of the surging economy. Firstly companies should evaluate their operating performance. But the present index including Return on Equity and Earnings per share has some shortcomings, for example the financial report can be intended rectified. Companies need a better way to do the performance evaluation. In addition the stock market is experiencing a downturn in recent years, it is very hard to find a good company to invest. In this situation we will study a new index called Economic Value Added (EVA) to help port companies us this tool to evaluate their performance, find a better method to improve their operating performance, on the other hand, to help the investors use this method to find goodinvesting targets and get more interests.On the basis of brief introduction to the origin, definition, application field and general calculating method of EVA, considered the situation of our public port companies, this paper creates an EVA calculating model tailored for our public port companies, then we calculate the value created by port companies from year 1999 to year 2003 and evaluate their operating performance with the element chart in five years. We find Shanghai Port Container Co., LTD.(SPCCO) Created the most value for shareholders. Shenzhen Yantian Port Holdings Co., LTD., Yingkou Port Liability Co., LTD. (YKPLC), Shenzhen Chiwan Wharf Holdings Limited (CCWH), Tianjin Port, China Merchants Shekou Holdings Co., LTD. (CMSH) also made much value for shareholders. Chongqing Gangjiu Co., LTD. (CQGJ),Jinzhou Port Co., LTD. (JZP), Fuhua Group Co., LTD. S.E.Z. made few value. Beihai Xinli Industrial Co., LTD. is the only company that lost value. In these companies SPCCO ranks the first and Yantian Port the second in the value making. But they two had different ways, SPCCO paid more attention to its main operating business, and it paid more back;Yantian Port was good at investments, its revenue from investment made great contribution to the value made. In addition its management level is high, the costs were less, the revenue was more;CMSH's main operating business performed well, but its profits from investments were few, if CMSH can manage the investments better, it will perform outstandingly.