ICTSI's Q3 profits slide on weak global trade
abs-cbnNEWS.com | 11/05/2009 4:02 PM
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MANILA - Port operator International Container Terminal Services Inc. (ICTSI) reported lower earnings for the third quarter of the year as the economic crisis continues to hurt global trade.
In a disclosure to the Philippine Stock Exchange on Thursday, ICTSI said its net income attributable to equity holders dropped 5% to $14 million from the $14.7 million recorded in the same period last year.
This brought the company's income for the 9-month period to $37.2 million, a 29% drop from last year's $52.4 million.
"The lower net income attributable to equity holders was mainly due to lower volume brought about by the decline in global trade, higher interest expense due to higher debt level, and the depreciation of currencies in the countries where ICTSI's ports are located (Philippine peso, Brazilian reals, euro) relative to the US dollar in the third quarter of the previous year," ICTSI said.
Revenues from port operations, meanwhile plunged 12% and 15% during the quarter and the first 9 months of the year, respectively.
ICTSI's finances have been presented in dollar terms since the start of the year. In the third quarter, the Philippine peso depreciated against the US dollar by 4% to P48.08 from last year's P46.10.
For the third quarter, ICTSI handled a total container volume of 943,805 twenty foot equivalent units (TEU), down 8% from 1.02 million TEUs in the same period last year. As of end-September, the company handled 2.5 million TEUs compared to 2.8 TEUs in 2008.
"Third quarter thoroughput volumes were stronger than the first 2 quarters, and the benefits of our cost containment efforts also contributed to ICTSI's improving financial results," ICTSI Chairman and President Enrique Razon Jr. said.
Asian operations, which include the Philippines, Indonesia, Japan, and China, accounted for 63% of consolidated volumes for the third quarter. Volume for ICTSI's operations in Asia was down 0.4% from July to September to 597,076 TEUs.
In the Americas (Brazil and Ecuador), volume dropped by 2% to 232,599 TEUs in the third quarter. Ports in this area accounted for 25% of ICTSI's consolidated volumes.
ICTSI's decline in volume was steepest in Europe, Middle East, and Africa (EMEA) as it posted a 38% drop to 114,130 TEUs. This was driven mainly by lower thoroughput in ICTSI's ports in Poland and Georgia.
For the first 9 months of the year, ICTSI invested $77 million to improve operating efficiency and acquire container handling equipment at its port operations in Ecuador, as well as to fund the construction of the 6th berth in Manila.
For the full year, the company's total expenditures is at $146.9 million to be used for civil works, systems improvement, and purchase of major cargo handling equipment at its port operations in Manila, Brazil, and Ecuador.
"The company expects to meet funding requirements for these expenditures from existing cash balance and internally generated funds," ICTSI said.
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