ICTSI earnings drop despite revenue hike
Earnings of International Container Terminal Services Inc. (ICTSI) dipped in the first half despite higher revenues, with the port operator attributing the decrease in net income to start-up costs of its new terminals abroad and non-recurring gains in the second quarter last year.
ICTSI said net income attributable to equity holders reached $97.7 million in the first semester, down six percent from $103.6 million recorded in the same period last year.
“The decrease in net income was due primarily to the start-up costs of the new terminals in Papua New Guinea and Australia and the $7.5 million non-recurring gain on the termination of the sub-concession agreement in Nigeria in the second quarter of 2017,” the company said.
ICTSI, however, posted a 10 percent increase in revenue to $661.8 million in the first half from last year’s $603.7 million, while EBITDA grew by three percent year-on-year to $299.5 million.
The growth in revenue was attributed mainly to volume growth, new contracts with shipping lines and services, increase in revenues from non-containerized cargoes, storage and ancillary services, and the contribution from the company’s new terminals in Lae and Motukea in Papua New Guinea, and Melbourne, Australia.
ICTSI handled consolidated volume of 4.714 million twenty-foot equivalent units (TEUs) in the first half, four percent more than the 4,545 million TEUs handled in the same period in 2017.
The company said the increase in volume was due to the robust global trade activities in the emerging markets, continuing volume growth at most terminals, and the contribution of the new terminals in Papua New Guinea and Australia.
For the first half, ICTSI’s capital expenditures amounted to $134.3 million, about 35 percent of the $380 million spending budget for 2018.
This year’s capex budget is mainly allocated for the capacity expansion in its terminal operations in Manila, Mexico and Iraq, continuing rehabilitation and development of the container terminal in Honduras, procurement of additional equipment and minor infrastructure works in newly acquired terminal operations in Papua New Guinea, and the completion of the new barge terminal project in Cavite City.