Int'l Container Terminal Services, Inc.

ICTSI sets USD380-M capex in 2018

MANILA – Port operator International Container Terminal Services, Inc. (ICTSI) has earmarked a capital spending of USD380 million this year after ending 2017 with a seven-percent increase in profit.

In a disclosure to the Philippine Stock Exchange, ICTSI said this year’s capital expenditure budget would be mainly allocated for the capacity expansion in its terminal operations in Manila, Mexico and Iraq.

The company said it would also finance the completion of its new barge terminal project in Cavite City, Philippines, the continuing rehabilitation and development of its container terminal in Honduras, and procurement of additional equipment and minor infrastructure works in its newly acquired terminal operations in Papua New Guinea.

This year’s capital spending budget is 58.3 percent higher compared to USD240 million in 2017.

ICTSI booked a net income of USD207.7 million last year from USD 193 million the previous year.

It attributed the increase in net income mainly to the continuing ramp-up at its new terminal in Matadi in Democratic Republic of Congo, strong operating results from the terminals in Iraq, Mexico, Honduras, Madagascar, China, Poland and Brazil; and the gain related to the termination of the sub-concession agreement in Lagos, Nigeria.

Higher earnings, however, was tapered by higher interest and financing charges, higher depreciation and amortization expenses, start-up costs at the company’s terminal in Melbourne Australia, and increase in share in the net loss at its joint venture container terminal project with PSA International Pte Ltd. in Colombia.

Its revenue from port operations reached USD1.24 billion last year, 10 percent higher compared to USD1.13 billion in 2016.

ICTSI handled consolidated volume of 9,153,458 twenty-foot equivalent units (TEUs) in 2017, five percent more than the 8,689,363 TEUs handled in 2016.

It said volume increased due mainly to continuing improvement in global trade activities, particularly in the emerging markets.


ICTSI readies expansion of three foreign ports in 2018

Port operator International Container Terminal Services Inc. said it is expanding three of its fastest growing terminals including one in Iraq, as it expects global trade to be “good” this year barring the merchandise war that could break out between China and the US.

ICTSI president and chairman Enrique Razon Jr. said in an interview following the  annual stockholders’ meeting the company allocated $380 million programmed for capital expenditures this year to expand the capacity of ports in Iraq, Mexico and Honduras.

Razon said ICTSI would increase the capacity in Iraq to 1 million TEUs (twenty foot equivalent units) and the output in Mexico to 1.5 million TEUs.

ICTSI would also complete the expansion of the Honduras port to boost the total capacity to 1 million TEUs, he said.

In the Philippines, ICTSI is set to complete a new barge terminal in Tanza, Cavite by June this year. The $30 million project, called Cavite Gateway Terminal in partnership with the Department of Transportation, will become the country’s first roll-on roll-off barge terminal. 

CGT will facilitate the off-the-roads transport of containers through the sea lanes of Manila Bay between the port of Manila and Cavite. It will have an annual capacity of 115,000 TEUs, or equivalent to 140,000 fewer trucks on city roads each year.

“This will be the first Build Build Build project developed, conceptualized, started and completed under this current administration,” Razon said.

Meanwhile, Razon said a trade war that could break out between China and the US was among possible disruptions that could affect growth of global trade.

ICTSI’s operation in Mexico is at risk amid prospects of a trade war, while the renegotiation of the North American Free Trade Area could disrupt shipments to Mexico from China.

Razon said the trade war could only be beneficial to ICTSI if China found other export markets.

“Our existing terminals are all growing,” Razon said.


ICTSI takes delivery of three mega boxship cranes at Manila Port

Philippines-based International Container Terminal Services Inc (ICTSI) is keeping up with market developments and has taken delivery of three new cranes at Manila International Container Terminal (MICT) to enable its flagship terminal to handle the world’s largest container ships and be on par with other major ports.

ICTSI said in a press release it took delivery of a pair of neo-panamax quay cranes and a post-panamax quay crane from Shanghai Zhenhua Heavy Industry.

The delivery of the cranes brings the Philippines’ largest port handling equipment to MICT, and the neo-panamax crane will enable the terminal to handle up to 14,000 teu ultra large container ships (ULCS), putting the terminal on equal footing with major ports in developed markets, it said.

“We are now ready for the era of super-sized ships. With the arrival of the new Neo-Panamax cranes, MICT is ready to address the pressing demand and volume increase by servicing larger vessels,” Christian Gonzalez, ICTSI head of global corporate and regional head of Asia Pacific and MICT, said.

The new quay cranes are part of ICTSI’s $80m capital equipment programme for MICT. The pair of neo-panamax cranes and the post-panamax crane will be positioned at Berths 6 and 5, respectively.

Two more quay cranes are expected to arrive next year. The new cranes are expected to boost quayside productivity and cut turnaround times at the port.

“The new cranes, along with other planned improvements at the MICT, will further boost the port’s already efficient turnaround times. This will redound to economic benefits benefiting the entire Philippine supply chain,” Gonzalez said.

“By investing in state-of-the-art infrastructure and equipment, we are strengthening MICT’s position as one of the best-equipped and most technologically advanced terminals serving the intra-Asia trade,” he concluded.


Cavite barge terminal seen opening by end-September

THE International Container Terminal Services, Inc. (ICTSI) and the Department of Transportation (DoTr) said the Cavite Gateway Terminal (CGT) may finally be used by end-September, months later its original target because of the three typhoons that affected the area in the past months.

After an inspection of the construction work by Transportation Secretary Arthur P. Tugade, other DoTr officials and representatives of International Container Terminal Services, Inc., the government said the barge terminal’s original scope of work is now 99% complete.

ICTSI, the proponent of the terminal, earlier said the project is part of the company’s $380-million capital expenditure this year. It said in June the target opening of the CGT was on the third week of that month.

“The project is completed, and we have successfully simulated the receipt and delivery of containers via barge and trucks. We are just confirming date of formal inauguration,” ICTSI said in an e-mail interview on Tuesday.

DoTr Communications Director Goddess Hope O. Libiran told BusinessWorld the delay was because “weather has not been very cooperative in the past few months.”

Ms. Libiran explained, “There’s a total of 98 caissons to be installed as foundations of the CGT pier. 61 have already been installed. There are 37 left for installation.”

Caissons are watertight chambers used as foundations of bridge piers, she said. For the CGT, the caissons are being used on the hard stand to prepare the future expansion of the barge terminal, which is 45% complete.

The CGT, also called the Cavite barge terminal, will be the country’s first roll-on, roll-off barge facility once completed. It will cater to cargo trans-shipments from Manila to the province of Cavite.

“The CGT was designed to expand our port capacity, and reduce traffic congestion in Metro Manila by supporting an annual capacity of 115,000 twenty-foot equivalent units (TEUs) translating to 140,000 fewer truck trips travelling on city roads per year,” the DoTr said.

The listed port operator posted a 15% fall in net income during the first quarter at $44.1 million. It said in a regulatory filing the weakening of the peso affected its operations in countries outside the Philippines.


...positive sa 2nd Qtr pero negative sa 1st Half

ICTSI Q2 income up 3% on record revenues

INTERNATIONAL Container Terminal Services, Inc. (ICTSI) reported its attributable net income increased by 3% to $53.597 million in the second quarter, on all-time high revenues and volumes.

In a statement, ICTSI said its attributable net income dropped 6% to $97.66 million in the first six months of 2018 from $103.6 million a year ago, “due primarily to the start-up costs of the new terminals in Papua New Guinea and Australia.” Last year’s comparable figure had included a one-time gain of $7.5 million from the termination of its sub-concession agreement in Nigeria.

ICTSI cited several other factors that contributed to its financial performance: “a decrease in the company’s share in the net loss at Sociedad Puerto Industrial Aguadulce S.A., its joint venture container terminal project with PSA International Pte Ltd. in Buenaventura, Colombia; and a $2.8 million non-recurring gain from the pre-termination of interest rate swap related to the pre-payment of the project finance loan at its terminal operations in Manzanillo, Mexico in May 2018.”

Excluding the non-recurring gains, the port operator said consolidated net income attributable to equity holders would have gone up by 15% in the second quarter, but would have dipped by one percent in the first half.

Second quarter revenues jumped 10% to $336.4 million, bringing the six-month tally 10% higher to $661.8 million.

“The increase in revenues was mainly due 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 said.

Excluding the new terminals, consolidated gross revenues increased by 7% in the April to June period, and 6% in the first half.

For the quarter ended June 30, ICTSI said total consolidated throughput rose 5% to 2,388,715 twenty-foot equivalent units (TEUs). ICTSI handled consolidated volume of 4,714,255 TEUs in the first six months of 2018, up 4% year-on-year. 


...nice move ICT Smile

ICTSI raises stake in North Harbor

INTERNATIONAL Container Terminal Services, Inc. (ICTSI) on Thursday said it is raising its stake in Manila North Harbor Port, Inc. (MNHPI) to 50%.

In a disclosure to the stock exchange on Thursday, the Razon-led port operator said it signed a share purchase agreement with Harbour Centre Port Terminal, Inc. (HCPTI) to acquire 4,550,000 MNHPI shares at P200 each or a total of P910 million. This represents 15.17% of MNHPI.

The deal will increase ICTSI’s stake in the operator of Manila North Harbor to 50% from the current 34.83%. The Romero-owned HCPTI owns the remaining stake in MNHPI.

“The transaction will allow ICTSI to contribute its experience, expertise and state-of the-art technology and infrastructure to enhance the operational efficiency of the domestic terminal in the Port of Manila and improve the traffic condition in Metro Manila,” ICTSI said.

ICTSI, which operates the Manila International Container Terminal, said the completion of the deal will depend on securing approval from the Philippine Ports Authority (PPA) and the Philippine Competition Commission (PCC), among others.

“This transaction will further improve the returns of ICTSI’s shareholders through this value-accretive acquisition,” the company said.

In September 2017, ICTSI bought Petron Corp.’s 34.83% stake in MNHPI for P1.75 billion.

MNHPI signed the 25-year contract to operate, manage and maintain the North Harbor in November 2009.

ICTSI said its attributable net income dropped 6% to $97.66 million in the first six months of 2018 from $103.6 million a year ago, “due primarily to the start-up costs of the new terminals in Papua New Guinea and Australia.” Last year’s comparable figure had included a one-time gain of $7.5 million from the termination of its sub-concession agreement in Nigeria. 


...take over nyo na yan!

ICTSI content with 50% stake in Manila North Harbor

MANILA, Philippines — International Container Terminal Services Inc. (ICTSI) is not making moves to take a controlling stake in Manila North Harbor Port Inc. (MNHPI) at present after raising its stake in the domestic port to equal that of the San Miguel Corp. (SMC).

“We are very happy the partnership as it stands today,” ICTSI head of Asia Pacific Christian Gonzalez said. 

“We have an operational distribution of responsibility between San Miguel and ourselves. They bring their expertise in financing and administrative side and we bring our expertise on the operational and engineering side. We can really add a lot of value to the business using both sets of expertise,” he said. 

The listed company of billionaire Enrique Razon Jr. announced early this month that it has signed a share purchase agreement with Harbour Centre Port Terminal Inc. (HCPTI) for the acquisition of the latter’s 4.55 million shares in MNHPI, hiking further its stake to 50 percent from 34.83 percent.

The remaining 50 percent is held by SMC.

ICTSI, however, said the completion of the share purchase agreement remains subject to a number of conditions precedent, including approvals from the Philippine Ports Authority (PPA) and the Philippine Competition Commission (PCC).

“We are very confident that we can show the PCC that the cost of doing business, particularly the interlinking of domestic and foreign boxes between the two facilities, will drive cost down for the consumers,” Gonzalez said.

“We will help road congestion that’s for sure,” he said.

MNHPI is a Philippine entity engaged in domestic port terminal business at the 56-hectare Manila North Harbor under contract with the PPA. Redevelopment and modernization of the port is ongoing.

Meanwhile, Gonzalez said the company is set to inaugurate next month the Cavite Gateway Terminal, the country’s first roll-on roll-off barge terminal project.

He said the project is currently operating for initial tests.

“We’re already running the barges back and forth. Inauguration is by October, but we already have some core customers that are using the barge,” Gonzalez said.

“It’s going to be a common user facility but then there’s a lot of demand for it. We’re working on it so operations will be smooth before we start,” he said.


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