Kingston Wharves records $1.6-billion net profit for nine-month period
Multi-purpose port terminal operator Kingston Wharves limited (KWL) on Wednesday reported an unaudited after-tax surplus of $1.6 billion for the nine-month period ended september 30, 2020. this represents a 16 per cent decrease compared to the previous corresponding period.
For the period under review, KWL recorded consolidated revenues of $5.1 billion, an 11 per cent or $615 million decline over the corresponding period in 2019.
The company’s terminal division generated operating revenue of $4.0 billion for the nine-month period, representing a decrease of 11 per cent over the previous corresponding period, while divisional profits stood at $1.5 billion, declining by 18 per cent.
However, according to Chairman Jeffrey Hall, despite the dip in revenues and profits influenced by the global fall-off in shipping volumes due to the novel coronavirus pandemic, the terminal division remains a key profit centre of KWL.
He added that the relatively strong performance in the logistics services division — an identified growth area — is “reason for optimism”.
For the nine-month period, the division generated revenues of $1.5 billion, a decrease of one per cent over the prior year, while divisional profits increased by nine per cent when compared with the corresponding period in 2019, moving from $499 million to $543 million.
“Kingston Wharves have begun to see positive signs of a recovery in the two main operational segments of our business. Our robust business continuity strategies have kept the company on a positive trajectory, even as we make the critical pivot to maximise the returns from emerging opportunities,” Hall said in the report to shareholders.
He further indicated that nearshoring is expected to become a greater feature of the global supply chain as companies and economies seek to diversify their supply sources for increased efficiency and as a contingency against shocks to the global economy.
To this end, Hall noted that KWL is well prepared to meet the expected demand for nearshore warehousing solutions and has positioned itself to add greater value to customers by leveraging its Special Economic Zone (SEZ) status to deliver customised, tax efficient solutions to meet their supply chain and logistics needs.
“The observance of our 75th anniversary in the midst of a global pandemic is a powerful reminder that we are resilient because our roots run deep and we are built on a solid foundation,” Hall said.
“We remain in a cautious but determined expansion mode, characterised by the pursuit of opportunities for vertical integration, product and service diversification and investment in our workforce, logistics-centred infrastructure and business processes enabled through digital technology,” he added.
“We believe that we have laid the solid groundwork to move forward post-pandemic and to restore the growth of our business. Kingston Wharves continues to be highly profitable and able to benefit from a strong balance sheet,” said Hall.