Malaysian port operator Westports Holdings Bhd saw its container volume and income decline in the second quarter of the current year largely as a result of the trend toward shipping alliances and mergers.
Westports reported a 6.9% decline in earnings to MYR148.82 million (US$34.73 million) for the period April-June from MYR159.87 million a year ago, which it attributed to structural changes in the wider industry.
Container throughput slipped back 11% to 2.23 million twenty-foot equivalent units (TEUs) in the second quarter compared to 2.50 million TEUs in the same period in 2016.
Westports’ revenue shrank 4% to MYR501.44 million in the second quarter from MYR522.63 million a year ago.
The changes were linked to the impact of carrier alliances, reshuffled service offerings and port calls, and mergers and acquisitions.
Westports said it expects container throughput to be lower by 7% to 12% this year compared to the previous year.
In the first half of the year, its earnings contracted 12.4% to MYR289.71 million from MYR330.95 million in the preceding corresponding period. But revenue rose to MYR1.022 billion from MYR987.34 million a year ago.
Container throughput reached 4.7 million TEUs in the first six months of the year, lower than the 4.9 million TEUs handled during the same time in 2016. Total transhipment containers handled decreased to 3.3 million TEUs. However, intra-Asia volumes, which contributed more than half of the total handled, saw growth of 7%.
Westports CEO Ruben Emir Gnanalingam told local media the port was affected by the “unprecedented recalibration and realignment processes with the formation and transition towards new global alliances as well as the recently completed and ongoing mergers and acquisitions activities.”
“Due to all these ongoing changes, we expect our container throughput to be lower for this year when compared to the previous year,” he added.
Photo courtesy of Westports
