ICTSI remains on expansion mode even as risks abound
Ports tycoon Enrique Razon Jr. is keeping an eye out for expansion opportunities in four regions as the billionaire indicated he has no plans of standing idle even in the face of emerging risks.
Razon yesterday announced that International Container Terminal Services Inc. (ICTSI) would keep on branching out in areas where it sees potential for business expansion.
Razon, who chairs ICTSI, said the company is on the lookout for new investments in the regions where it is most successful, namely, Asia, Africa, Latin America and the Middle East.
ICTSI is raising its capital expenditures by more than a third to $450 million this year, from $336.32 million in 2023. The company is optimistic it can sustain growth even as it is faced with global uncertainties, from economic risks to political tensions.
Razon cited the war in Ukraine as one of the developments that could impede ICTSI’s expansion plans. The conflict started in 2022 when Russia invaded Ukraine, and is brewing until today with no end in sight.
Apart from this, Razon said the shipping industry is wary of trading delays caused by the war in Gaza and its spillover in the Red Sea.
“The war in Ukraine has entered its third year with still no end in sight, and new conflicts in the Middle East have caused maritime disruptions to shipping in the Red Sea, and [have] once again resulted in supply chain delays in the Asian, European and Middle East trades similar to what we experienced during the height of the pandemic,” Razon said.
“There were also many positives in areas where we have operations, such as Latin America and Africa, which provided growth and improved margins, enabling the company to achieve positive results,” he added.
The good thing for ICTSI is that it is unaffected by the maritime dispute between the Philippines and China in the West Philippine Sea. Razon said it is business as usual for ICTSI in China, where the company operates a terminal in manufacturing powerhouse Shandong.
For 2024, ICTSI expects to complete the development of the East
Java Multipurpose Terminal in Indonesia. Further, it plans to expand the capacities of its facilities in the Philippines, Democratic Republic of Congo and Mexico.
In the Philippines, ICTSI is proceeding with the P10.53 billion rehabilitation and upgrade of the Visayas Container Terminal, formerly the Iloilo Commercial Port Complex.
Although ICTSI’s profit dropped by 17 percent to $511.53 million in 2023, the company kept its balance sheet in the pink of health, growing its revenue by seven percent to $2.39 billion.