Friday 29 Mar 2024
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KUALA LUMPUR (July 20): Westports Holdings Bhd reported that net profit in the second quarter ended June 30, 2017 (2QFY17) declined 6.9% — its second straight quarterly tumble — mainly due to an 11% drop in container throughput handled in the current quarter under review.

Net profit fell to RM148.82 million in 2QFY17 from RM159.87 million a year ago. Earnings per share was lower at 4.36 sen compared with 4.69 sen in 2QFY16.

Quarterly revenue also dropped 4.1% to RM501.44 million in 2QFY17 from RM522.63 million in 2QFY16.

Nevertheless, Westports declared a first interim dividend of 6.37 sen per share for the financial year ending Dec 31, 2017 (FY17), payable on Aug 15.

In a filing with Bursa Malaysia today, Westports said container volume dropped to 2.23 million TEUs (20-foot equivalent units) in 2QFY17 from 2.5 million TEUs a year ago, while it was down 5% for the first six months of the year (1HFY17) to 4.66 million TEUs from 4.91 million TEUs in 1HFY16.

The weak second-quarter results performance dragged down its net profit for 1HFY17 by 12.5% to RM289.71 million from RM330.95 million. However, revenue rose 3.5% to RM1.02 billion from RM987.34 million a year ago.

On prospects, Westports is expecting to see a 7% to 12% year-on-year drop in container throughput this year due to the ongoing changes in the container shipping industry.

In a separate statement today, Westports chief executive officer Ruben Emir said the container shipping industry is going through what he calls "an unprecedented recalibration and realignment processes" with the formation and transition towards new global alliances, as well as the recently completed and ongoing mergers and acquisitions (M&As) activities.

"At Westports, we experienced the transition from the phasing-out of Ocean 3 services to the gradual phasing-in of Ocean Alliance services. We have also secured a service from THE Alliance," he said.

"The industry's recent and ongoing M&As could also affect our container volume handled, especially of transhipment boxes, as the enlarged and merged entity may select to re-assess their service offerings and port of calls. Due to all these ongoing changes, we expect our container throughput to be lower this year when compared with 2016," he added.

Looking on the bright side, Ruben said after the well-above average rate of utilisation rate in 2016, the more modest volume so far this year has facilitated much greater flexibility in its terminal operations, as well as improved service levels and productivity.

Meanwhile, Westports noted that the second phase of its Container Terminal 8 (CT8), consisting of a 300-metre wharf and supporting terminal operating equipment and facilities, has just been completed and is expected to be commissioned into service soon, bringing the total terminal handling capacity to 12.5 million TEUs.

It added that construction work continues at the first phase of CT9, consisting of a 600-metre wharf, and is expected to be completed by December this year.

At 2.44pm, Westports' share price fell 3 sen or 0.82% to RM3.64, with 274,600 shares traded, giving it a market capitalisation of RM12.45 billion.

 

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