ICTSI earnings drop in 2015

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International Container Terminal Services Inc, or ICTSI, posted significantly lower net income in 2015, due to non-cash and one-time charges.

In its 2015 financial report, ICTSI announced that net income of $58.5m last year, down 68% from $182m in 2014.

The company reported earnings before interest, taxes, depreciation and amortisation, or EBITDA, of $450m, which was 2% higher than the $443m it generated the year before.

Diluted earnings per share for the same period, however, declined 85% from $0.075 in 2014 to $0.011 in 2015.

Additionally, the report noted that, excluding the effect of one-time adjustments to carrying value of certain subsidiaries and non-recurring charges, recurring net income would have increased 1% to $174.7min 2015.

ICTSI recognised non-recurring charges totalling $116.2m in 2015, the majority of which involving impairment charges on the concession rights’ assets of the company’s terminal in Buenos Aires, Argentina, Tecplata.

The report further reported that the international operator handled consolidated volume of 7.8m teu in 2015, 5% more than the company handled in 2014. This growth was mainly due to the continuing ramp-up of volumes at Contecon Manzanillo in Manzanillo, Mexico and Operadora Portuaria Centoamericana S.A de C.V in Puerto Cortes, Honduras.

Meanwhile, gross revenues from all port operations were 1% lower in 2015, at $1.051bn, due to “unfavourable container mix volume, lower storage revenues and ancillary services, and negative foreign exchange” across a number of terminals. ICTSI’s revenues were also adversely affected by the loss of two major shipping lines at its terminal in Portland, as a result of continuing labour disruption at ICTSI Oregon, weaker shortsea trade, and reduced vessel calls at its Baltic Container Terminal in Gdynia, Poland.

Consolidated cash operating expenses decreased as well in 2015, falling 5% from $454.5m in 2014 to $432.3m. Lower global fuel prices, lower repairs and maintenance expenses, lower variable cost at ICTSI Oregon due to volume decline, and the depreciation of the local currency at many of the company’s ports were given as reasons behind this decline.

Capital expenditure, mainly related to construction and procurement of equipment, amounted to $353.5mfor the year, which is approximately 67% of its original $530mcapital expenditure budget.

The completion of ICTSI’s new container terminals in Mexico, Honduras and Iraq, capacity expansion in its terminal in Manila, and the early development of new terminals in Democratic Republic of Congo and Australia accounted for the majority of capital expenditure.