ICTSI revenues up 12% to $297M in three months

International port operator International Container Terminal Services Inc. (ICTSI) reported unaudited consolidated finan­cial results for the quarter ended March 31 posting revenue from port opera­tions of $297.2 million, an increase of 12 percent over the $266.5 million re­ported for the same period last year.

Earnings Before Interest, Taxes, Depreciation and Amortization (Ebitda) of $147 million, 21 percent higher than the $121.9 million generated in the first quarter of 2016; and net income attrib­utable to equity holders of $51.7 mil­lion, 23 percent more than the $42.2 million earned in the same period last year due to strong operating income ta­pered by higher depreciation charges, higher interest and financing charges, and an increase in the company’s share in the net loss at Sociedad Puer­to Industrial Aguadulce S.A. (SPIA), its joint venture container terminal project with PSA International Pte Ltd. (PSA) in Buenaventura, Colombia, which in­creased from $2.1 million in the first quarter of 2016 to $7.4 million for the same period in 2017 as the company started full commercial operations.

ICTSI handled consolidated volume of 2,272,647 twenty-foot equivalent units (TEUs) in the first quarter, 11 percent more than the 2,053,639 TEUs handled in the same period in 2016.

The increase in volume was pri­marily due to continuous improvement in global trade activities particularly in the emerging markets, continuing ramp-up at ICTSI Iraq, and the contri­bution of ICTSI Democratic Republic of Congo (IDRC), the Company’s new terminal in Matadi, DRC. Excluding the new terminal in DRC, consolidated vol­ume increased by 10 percent.

Gross revenues from port opera­tions for the quarter ended March 31, 2017 increased 12 percent to $297.2 million from the $266.5 million report­ed in the same period in 2016. The increase in revenues was mainly due to volume growth, tariff rate adjust­ments at certain terminals, new con­tracts with shipping lines and services, and the contribution from the Compa­ny’s new terminal in Matadi, DRC. Ex­cluding the new terminal in DRC, con­solidated gross revenues increased by eight percent.

Consolidated cash operating expenses for the first three months of 2017 was two percent higher at $103.9 million compared to US$101.5 million in the same period in 2016.

The increase in cash operating expenses was mainly driven by the in­crease in variable manpower costs and higher fuel consumption as a result of the increase in throughput; higher fuel prices and power rate adjustments at certain terminals; unfavorable transla­tion impact of the BRL appreciation at Suape, Brazil; and cost contribution of the new terminals in Matadi, DRC and Melbourne, Australia.

The increase was tapered by the additional benefits of the on-going group-wide cost optimization initiatives and the favorable translation impact of Philippine Peso and Mexican Peso ex­penses at the various terminals in the Philippines and in Manzanillo, Mexico, respectively.

Consolidated EBITDA in the first quarter of 2017 increased 21 percent to $147 million from $121.9 million in 2016 mainly due strong volume and revenue growth combined with the ad­ditional benefits of the on-going group-wide cost optimization initiatives and positive contribution of the new termi­nal in Matadi, DRC.

Consequently, EBITDA margin im­proved to 49 percent in the first quarter of 2017 from 46 percent in the same period in 2016.

Consolidated financing charges and other expenses for the quarter in­creased 25 percent from $20.9 million in 2016 to $26.2 million in 2017 primar­ily due to higher average loan balance tapered by the higher capitalized bor­rowing cost.

Capital expenditure in the first quarter of 2017 amounted to $33.0 mil­lion, approximately 14 percent of the $240.0 million capital expenditure bud­get for the full year 2017.

The established budget is mainly allocated for the completion of the ini­tial stage development of the Compa­ny’s greenfield projects in Democratic Republic of Congo and Iraq; the sec­ond stage development of the Compa­ny’s project in Australia; continuing de­velopment of the Company’s container terminals in Mexico and Honduras; and capacity expansion in its terminal oper­ations in Manila.

In addition, ICTSI invested $9.1 million in SPIA in Buenaventura, Co­lombia. The Company allocated ap­proximately $25.0 million for its share in 2017 to complete the initial phase of its joint venture container terminal project with PSA International.

ICTSI is widely acknowledged to be a leading global developer, man­ager and operator of container termi­nals in the 50,000 to 2.5 million TEU/ year range. ICTSI has an experience record that spans four continents and continues to pursue container terminal opportunities around the world.