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Thursday, May 15, 2014

ICTSI says Q1 profits up 29% on sale of non-core asset in Cebu

International Container Terminal Services Inc. (ICTSI) on Wednesday said net income reached $52.4 million in the first quarter, up 29 percent from $40.7 million a year earlier.

The bottom line mainly reflected a non-recurring gain from the sale of a non-core asset in Cebu, the company said in a disclosure to the Philippine Stock Exchange.

In January, ICTSI sold its interest in Cebu International Container Terminal Inc. to Cebu Asian Rim Property and Development Corp. and Hong Kong Land (Philippines) BV for $13.2 million.

“The higher net income attributable to equity holders was mainly due to the one-time gain on sale of a non-core asset,” the disclosure read.

Net income would have been up by only 6 percent to $45.1 million without the sales proceed from Cebu International Container Terminal Inc.

The transaction helped to offset the higher interest on concession rights from the new contract of Operadora de Puerto Cort├ęs S.A. de C.V. (OPC) in Honduras, and the depreciation, amortization and start-up expenses from the new terminals Contecon Manzanillo S.A. de C.V. in Mexico and OPC.

Port operations revenues rose 19 percent to $248.9 million from $209.3 million.

Earnings before interest, taxes, depreciation and amortization (EBITDA) rose by 6 percent to $103.6 million from $97.5 million.

Consolidated volume totaled 1.757 million twenty-foot equivalent units (TEUs), up 17 percent from 1.496 million TEU, reflecting better international and domestic trade and the latest business from new terminal operations in Mexico and Honduras, without which the first quarter volume would have grown by 1 percent.

The terminal operations in Manila, Brazil, Poland, Ecuador, Madagascar, China and Pakistan accounted for 71 percent of the consolidated volume in January to March, said ICTSI.

“The increase in revenues was mainly due to higher storage revenues and ancillary services, favorable volume mix, tariff rate increases in certain terminals, new and renegotiated contracts with shipping lines and forwarders, and the revenue contribution from the new terminals in Manzanillo, Mexico and Puerto Cortes, Honduras,” the company said.

Cash operating expenses went up 28 percent to $108.2 million from $84.6 million, taking into account the operating expenses of new terminals in Mexico and Honduras.

Higher costs of manpower as volume increased and higher salary rates as mandated by governments in certain terminals also raised expenses.

Expenses were also incurred after the rent rebate program for ICTSI Oregon ceased starting January 2014.
Business development in pursuit of port projects also translated to additional expenses.

The company used $64 million or 21 percent of its capital expenditures in the first quarter. The full-year capex was $310 million, including allotments for new container terminals in Mexico and Argentina and the development of terminals in Honduras and Democratic Republic of Congo.
ICTSI also invested $11.4 million for the development of SPIA, a joint venture project with PSA International Pte Ltd. (PSA) in Buenaventura, Colombia.

- GMA News

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