ICTSI’s 2017 income flat on higher costs, charges

INTERNATIONAL Container Terminal Services Inc. (ICTSI) said its income was flat last year, hurt by  higher interest and financing charges, higher depreciation and amortization expenses, start-up costs at the company’s terminal in Australia and the widening of its net loss at its joint venture in Colombia.

The company said its net income attributable to equity holders came in at $182.1 million, up 1 percent compared to the $180 million earned in the previous year.

Excluding the gain of $7.5 million on the termination of the sub-concession agreement in Nigeria in 2017 and the charge of $23.4 million on the pre-termination of the lease agreement in 2016 at ICTSI Oregon Inc.—the company’s terminal in Portland, Oregon, in the Unted States—consolidated net income attributable to equity holders would have declined by 14 percent in 2017.

The company said it is increasing its capital-expenditure (capex) budget this year to $380 million, or more than double than last year’s $174.8 million.

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ICTSI said it will use its capex this year 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 completions of its new barge terminal project in Cavite City.

Revenue from port operations reached $1.24 billion, 10 percent higher compared to $1.12 billion in 2016, mainly due to higher volume, tariff-rate adjustments at certain terminals, new contracts and services with shipping lines, and the contribution from the company’s new terminals.  Organically, consolidated gross revenues increased by 7 percent, the company said.

The increase in net income was mainly due to the continuing ramp-up at the company’s new terminal in Matadi, Democratic Republic of the Congo; strong operating results from the terminals in Iraq, Mexico, Honduras, Madagascar, China, Poland and Brazil; and the gain related to the termination of the sub-concession agreement in Lagos, Nigeria.

ICTSI said its net loss on  Sociedad Puerto Industrial Aguadulce S.A., its joint-venture container terminal project with PSA International Pte. Ltd. in Buenaventura, Colombia, widened to $36.7 million last year, from $5.6 million in 2016, as the company started full commercial operations at the beginning of the year.

ICTSI handled consolidated volume of 9.15 million twenty-foot equivalent units (TEUs) in 2017, 5 percent more than the 8.68 million TEUs handled in 2016.

The increase in volume was primarily due to continuing improvement in global trade activities, particularly in the emerging markets, continuing ramp-up at ICTSI’s operations in Basra, Iraq, new services at Manzanillo, Mexico, and contribution of new terminals in Matadi, Congo, and Melbourne, Australia.  Excluding the new terminals, consolidated volume would have increased by 4 percent.

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