Bintulu Port to reduce dependency on LNG cargo

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KUALA LUMPUR: Bintulu Port Holdings Bhd is aiming to reduce its dependency on liquefied natural gas (LNG) cargo to 60% of its total operating revenue in the next five years, said its chairman Tun Mohd Eusoff Chin.Currently, LNG revenue contributes 78% of the Main Board-listed company’s total operating revenue. Eusoff said Bintulu Port would only further develop LNG facilities if such a need arose.“To realise this, the group will enhance existing facilities as well as develop new facilities such as refurbishment of the multipurpose terminal and development of 19.1ha for operation buildings and yard,” Eusoff said in the company’s annual report for the fiscal year ended Dec 31, 2008 (FY08).He said the company planned to expand its container terminal (which includes stacking yard, additional berths and container freight station), develop an additional berth for the edible oil terminal, oil and gas terminal and break bulk facilities (which comprise 500m berths, warehouse and storage yard).“The estimated cost of these project is about RM600 million,” said Mohd Eusoff. The company operates via two wholly owned subsidiaries Bintulu Port Sdn Bhd (BPSB) and Biport Bulkers Sdn Bhd (BBSB).For BPSB, LNG remains the major contributor with 56.05% of the cargo throughput, followed by containerised cargo 10.64%, crude oil 9.98% and palm oil products 4.80%. Petroleum products, logs, plywood, sawn timber, urea and liquefied petroleum gas contribute the balance.BBSB, which specialises in providing storage and bulking services, recorded a 292% rise in the handling of palm oil products to 1.53 million tonnes in 2008 from 388,976 tonnes in 2007.The company attributed the strong performance to the utilisation of its facilities by two major customers with effect from April 2008, according to its FY08 annual report.Eusoff said BBSB currently had 26 tanks with a capacity of 39,050 tonnes and with the completion of an additional 24 storage tanks, the total capacity was expected to increase to 75,110 tonnes and will boost the group’s revenue in the future. “Another 10 storage tanks with 26,000 tonnes’ capacity will be constructed in due time,” he said. For FY08, its net profit rose 11% to RM150.61 million from RM135.64 million in the previous year while revenue increased 7.57% to RM448.77 million from RM417.17 million. Earnings per share climbed to 37.65 sen from 33.91 sen.Shares of Bintulu Port, trading at a current price-to-earnings ratio (PER) of 15.27 times, closed 35 sen higher at RM6.30 on April 17 with a total of 228,900 shares changing hands. The counter reached its 52-week high of RM6.62 on April 29, 2008 while its low was RM5.20 on Feb 12, 2009.All the three research houses which cover the stock — Kenanga, CIMB and Maybank Investment Bank — have a buy on Bintulu Port. Kenanga’s latest target price for the stock was RM6.75, CIMB at RM6.50 and Maybank at RM6.70, according to their research reports in January and February.