ICTSI’s profits rise 51% in first quarter

Published May 7, 2021, 6:00 AM

by James A. Loyola

International Container Terminal Services Inc. reported a 51 percent hike in unaudited consolidated attributable net income to US$90.1 million in the first quarter of 2021 from the US$59.6 million earned in the same period last year.

In a disclosure to the Philippine Stock Exchange, the firm said the higher profit is primarily due to higher operating income; and significant reduction in equity in net loss of joint ventures; partially tapered by an increase in interest expense on loans, and higher interest on concession rights payable and lease liability from the new terminals.  

“ICTSI has delivered strong operating performance in the first quarter of 2021, with volume, revenue and earnings rising across our three regions: Asia, the Americas, and Europe, Middle East, and Africa (EMEA) said ICTSI Chairman and President Enrique K. Razon Jr.

Enrique K. Razon Jr.

He added that, “We have seen improvements in most of our terminals as economies continue to recover from the pandemic as well as significant contributions from new shipping lines and services.”

Razon noted that, “The pandemic remains extremely challenging for so many people around the globe.  At ICTSI, we are proud of our role in working with the government and the private sector in driving the vaccination procurement program in the Philippines.”

“Not only will this combined effort save lives, it will also contribute to the full opening of the Philippine economy and support significant recovery across all business sectors,” he said.  

Unaudited consolidated revenue from port operations rose 16 percent to US$435.6 million from the US$375.8 million reported for the same period last year. 

Gross revenues from port operations was higher mainly due to volume growth, favorable container mix, tariff adjustments at certain terminals, new contracts with shipping lines and services, and increased storage and ancillary services particularly in the Americas segment. 

ICTSI handled consolidated volume of 2,707,791 twenty-foot equivalent units (TEUs) for the quarter ended March 31, 2021, 8 percent more than the 2,508,986 TEUs handled in the same period in 2020 primarily due to improvement in trade activities as economies recover from the impact of the pandemic; and new shipping lines and services at the Company’s operations overseas.

The increase was partially tapered by decline in trade activities at certain terminals primarily due to the impact of COVID-19 pandemic. 

ICTSI also registered an equity in net gain of joint ventures of US$42 thousand in the first quarter of 2021 in contrast to the US$5.5 million equity in net loss for the same period in 2020.

This is due to the company’s higher share in net earnings with respect to Manila North Harbour Port, Inc. (MNHPI) as a result mainly of the impact of Corporate Recovery and Tax Incentives for Enterprises (CREATE) on the deferred tax liabilities associated to the acquisition of MNHPI; and the company’s lower share in 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.

The Group’s capital expenditure budget for 2021is approximately US$250.0 million. The estimated capital expenditure budget will be utilized mainly for the completion of the expansion project at MICT in Manila, Philippines; the ongoing yard expansion at IDRC in Matadi, Democratic Republic of Congo; the new expansion project at VICT in Melbourne, Australia; equipment acquisitions and upgrades; and for various maintenance requirements.