ICTSI posts 23% growth in net income in Q1 2017

Manila International Container Terminal. Source: ICTSI

Philippines-based port operator International Container Terminal Services, Inc. (ICTSI), has announced today the unaudited consolidated financial results for the quarter ended March 31, 2017, posting a 23% increase in net income: USD 51.7 mln against USD 42.2 mln earned in the first quarter last year.

According to the report, the operator’s consolidated throughput grew by 11% to 2,272,647 TEU in Q1 2017, as compared to 2,053,639 TEU handled in the same period in 2016. The increase in volume was attributed to improvements in the global trade, particularly in the emerging markets, developments at ICTSI Iraq, and the contribution of the company’s new terminal in Matadi, Democratic Republic of Congo (IDRCSA). The consolidated volume without IDRCSA increased by 10%.

Gross revenues from ICTSI’s port operations increased 12% to USD 297.2 mln (USD 266.5 mln in Q1 2016). The company explains the achievement by volume growth, tariff rate adjustments at certain terminals, new contracts with shipping lines and services, and the contribution from the new terminal in Matadi, excluding which the increase in gross revenues is 8%.

The company’s consolidated EBITDA improved by 21% to USD 147.0 mln (USD 121.9 mln in Q1 2016), mainly due strong volume and revenue growth combined with the additional benefits of the on-going cost optimization initiatives across the Group. EBITDA margin improved to 49% from 46% in Q1 2016.

However, ICTSI comments that the strong operating income was tapered by higher depreciation charges, higher interest and financing charges, and by an increased company’s share in the net loss at Sociedad Puerto Industrial Aguadulce S.A. (SPIA), its joint venture container terminal project with PSA International Pte Ltd. in Buenaventura, Colombia, which grew from USD 2.1 mln in Q1 2016 to USD 7.4 mln in Q1 2017 as the company started full commercial operations.

Capital expenditure in the first quarter of 2017 amounted to USD 33.0 mln, which constitutes about 14% of the USD 240.0 mln capital expenditure budget for the full year 2017. The established budget is allocated for the completion of the initial stage of the company’s greenfield projects in Congo (IDRCSA) and Iraq; the second stage of the project in Australia; continuing development of the container terminals in Mexico and Honduras; and capacity expansion in its terminal operations in Manila. In addition, ICTSI invested USD 9.1 mln in its Colombian project of SPIA. The company allocated about USD 25.0 mln in 2017 to complete the initial phase of the terminal.

The financial results follow the company’s reporting yesterday of a productivity achievement at its New Container Terminal 1 at the Subic Bay Freeport. During the inaugural port call of Cape Fulmar, Evergreen container vessel of 1,440 TEU capacity, two Panamax quay cranes handled about 400 TEU, with each crane averaging 40 and 33 moves per hour, respectively. This brings the productivity levels at NCT 1 at par with those of ICTSI’s flagship facility Manila International Container Terminal.

Julia Louppova:
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