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Net income in first nine months of 2020 rose 3% year-on-year
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For third quarter alone, revenue from port operations up 7% against the same quarter last year, while net income grew 34% during the period reviewed
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Consolidated volume in first nine months totaled 7.426 million TEUs, 2% less than that handled last year
Global port operator International Container Terminal Services, Inc. (ICTSI) reported a net income of US$210.4 million for the first nine months of 2020, 3% higher than the $205 million earned in the same period last year.
Net income attributable to equity holders for the period January-September 2020 is $182.6 million, 1% lower than the $184.9 million earned year-on-year. This is due mainly to higher interest on concession rights payable and COVID-19 related expenses, partially tapered by higher operating income, improvement in net operating results at the company’s greenfield terminal in Melbourne, Australia, and lower equity in net loss of joint ventures, ICTSI said in a statement.
Revenue from port operations in the first nine months of 2020 reached $1.104 billion, lower by 0.3% compared to the $1.107 billion reported last year.
For the third quarter alone, revenue from port operations increased 7% to $379.3 million from $355.6 million in the same quarter last year, while net income grew 34% to $79.1 million from $58.9 million.
The company’s performance in the third quarter benefited from cost preservation measures taken to mitigate the adverse effects of the pandemic, ICTSI chairman and president Enrique Razon, Jr. said in a statement.
“Our actions, together with improvements in global trade, a diversified portfolio, and high levels of customer service have helped to deliver an improved performance compared to the same period in the previous year,” he said.
But Razon added they remain cautious amid the continued uncertainties generated by the pandemic and an unpredictable environment as certain parts of the world move to a secondary lockdown.
“However, ICTSI is well positioned to benefit further should global trade continue to show signs of recovery, underpinned by our stringent cost management, ability to swiftly respond to changing situations and our diverse geographical presence,” he said.
Volume recovery in Q3
In the first nine months, ICTSI handled consolidated volume of 7.426 million twenty-foot equivalent units (TEUs), or 2% less than the 7.590 TEUs handled in the same period in 2019.
The decrease in volume was primarily due to the decline in trade activities which resulted from the impact of the COVID-19 pandemic on global trade and lockdown restrictions.
Excluding the contribution of ICTSI Rio, the company’s new terminal in Rio de Janeiro, Brazil, consolidated organic volume would have decreased 4% in the first nine months of 2020.
For the third quarter of 2020 alone, total consolidated throughput was 3% higher at 2.627 million TEUs compared to 2.548 million TEUs in 2019.
Consolidated cash operating expenses in the first nine months of 2020 was 3% lower at $331.6 million compared to $341.6 million in the same period in 2019. The decrease was mainly due to continuous group-wide cost reduction and optimization measures, and favorable translation impact of Brazilian real-, Mexican peso-, and Pakistani rupee-based expenses.
Consolidated financing charges and other expenses for the first nine months of 2020 increased 11% from $95.2 million in 2019 to $105.5 million in 2020, primarily due to COVID-19-related expenses and the absence of capitalized borrowing cost related to the Phase 2 expansion project in Basra, Iraq in 2019.
Capital expenditures for January to September 2020 amounted to $128.6 million. The capital was used mainly for the ongoing expansions at Manila International Container Terminal in the Philippines; Contecon Manzanillo S.A. in Manzanillo, Mexico; Contecon Guayaquil S.A. in Guayaquil, Ecuador; Basra Gateway Terminal in Umm Qsar, Iraq; and ICTSI DR Congo in Matadi, Democratic Republic of Congo.
Amid the ongoing impact of the COVID-19 pandemic on global trade, ICTSI has reduced its capital expenditure plan for the year to around $160 million, to be utilized mainly to complete ongoing expansion projects.
