International Container Terminal Services, Inc. (ICTSI) reported a 15% drop in net income attributable to equity holders to $44.1 million from $51.7 million year-on-year, attributed by the port operator to “drag from the new terminals”.
The decline in net income came amid a 9% growth in port operation revenues to $325.4 million from $297.2 million.
The higher port operation revenues resulted from volume growth, tariff rate adjustments at certain terminals, new contracts with shipping lines and services, increased storage and ancillary services, and the contribution from the company’s new terminals in Australia and Papua New Guinea. Excluding the new terminals, consolidated gross revenues would have increased by 6%, ICTSI said in a statement.
Revenues from the Asia segment, which made up 47.6% of the total revenues for the period, increased 8.9% to $155 million from $142.4 million mainly due to volume growth at most of the Philippine terminals; and contribution of new terminals in Australia and Papua New Guinea. Revenue was partially dragged by lower trade volumes at its Karachi, Pakistan terminal and the translation impact of the depreciation of Philippine peso-based revenues at Philippine terminals.
Revenues from the Americas segment slipped 1.8% to $101.4 million from $103.3 million due to reduced vessel calls at its Ecuador terminal. The drop was tapered by an increase in vessel calls and new services at its terminal in Manzanillo, Mexico; tariff adjustments at its Ecuador terminal; higher storage revenues combined with tariff adjustments at its Honduras terminal; and favorable translation impact of the appreciation of Mexican peso-based revenues at Manzanillo. The Americas operations accounted for 31.2% of the total consolidated revenues of ICTSI for the first quarter.
Revenues from the Europe, Middles East, and Africa (EMEA) operations grew 33.8% to $69 million from $51.6 million following continuous growth and ramp-up at its Iraq and Congo terminals; increased ancillary services at Iraq; continuous improvement in trade activities at Madagascar and Croatia terminals; increased revenues on non-containerized cargoes; and favourable translation impact of the appreciation of Euro-based revenues at Madagascar and Croatia.
2% rise in consolidated volume
For the first quarter of 2018, ICTSI handled a consolidated volume of 2.326 million twenty-foot equivalent units (TEUs), 2% more than the 2.273 million TEUs it handled in the same period in 2017.
The port operator said the increase in volume was primarily due to continuous improvement in global trade activities, particularly in the emerging markets; continuing ramp-up at ICTSI Iraq and ICTSI Democratic Republic of Congo; and contributions from Victoria International Container Terminal and South Pacific International Container Terminal Limited, the company’s new terminals in Melbourne, Australia and Lae, Papua New Guinea, respectively.
The increase was tapered by the volume decline in Guayaquil, Ecuador and Karachi, Pakistan. Excluding new terminals, consolidated volume would have decreased marginally by 0.4%.
Capital expenditures, excluding capitalized borrowing costs, for the first quarter of 2018 amounted to $68 million, approximately 18% of the $380 million budget for the full year 2018.
The established budget is mainly allocated for the capacity expansion in its terminal operations in Manila, Mexico and Iraq; continuing rehabilitation and development of the company’s container terminal in Honduras; procurement of additional equipment and minor infrastructure works in its newly acquired terminal operations in Papua New Guinea; and the completion of its new barge terminal project in Cavite City, Philippines.
ICTSI is a global developer, manager and operator of container terminals in the 50,000 to 3 million TEU/year range. ICTSI has an experience record that spans six continents and continues to pursue container terminal opportunities around the world.
