International Container Terminal Services Inc. said net income in the first quarter of 2018 fell 15 percent to $44.1 million from $51.7 million year-on-year, dragged down by higher expenses from new terminals.
Gross revenues from port operations in first quarter rose nine percent to $325.4 million from $297.2 million in the same period in 2017.
“The increase in revenues was mainly due to volume growth, tariff rate adjustments at certain terminals, new contracts with shipping lines and services, increased storage and ancillary services, and the contribution from the company’s new terminals in Australia and Papua New Guinea,” ICTSI said.
Excluding the new terminals, consolidated gross revenues increased six percent.
ICTSI handled consolidated volume of 2,325,540 twenty-foot equivalent units (TEUs) in the first quarter, two percent more than 2,272,647 TEUs handled in the same period in 2017.
“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 ICTSI Democratic Republic of Congo (IDRC), and contributions from Victoria International Container Terminal and South Pacific International Container Terminal Limited, the Company’s new terminals in Melbourne, Australia and Lae, Papua New Guinea, respectively,” ICTSI said.
The increase, however, was tapered by the volume decline in Guayaquil, Ecuador and Karachi, Pakistan.
Consolidated volume growth was flat.
The company’s consolidated cash operating expenses rose 24 percent to $129.1 million from $103.9 million last year.
“The increase in cash operating expenses was mainly driven by cost contribution of new terminals in Australia and Papua New Guinea, higher fuel consumption and external yard rental as a result of increase in volume, increase in price of fuel and power rate at certain terminals, and unfavorable translation impact of Mexican Peso expenses at CMSA,” it added.
The company’s capital expenditures excluding capitalized borrowing costs for the first quarter of 2018 amounted to $68 million, about 18 percent of the $380-million capex budget for the full year 2018.