ICTSI eyes more overseas projects

ICTSI eyes more overseas projects
By Zinnia B. Dela Peña
The Philippine Star 04/21/2006

Port operator International Container Terminal Services Inc. (ICTSI) is eyeing three or four projects in Eastern Europe, Latin America and the Middle East in line with efforts to further expand its presence overseas.

ICTSI chairman and president Enrique K. Razon said the company has already submitted bids for the proposed container port operations abroad and expects a decision within the next six to 10 months.

The proposed ports, he said, will have a capacity of between 300,000 to one million TEUs or 22-foot equivalent units (TEUs).

Razon said ICTSI will also make additional investments in its existing port terminals abroad. It has earmarked $26 million for the Madagascar International Container Terminal alone, around $15 million of which will be spent this year.

He said funding will come from internally-generated cash.

ICTSI will not be spending much for its local operations this year as it anticipates lower volumes. Last year, its anchor port Manila International Container Terminal (MICT) accounted for 66 percent of consolidated volume or 1,213,109 TEUs, up less than one percent over the 2004 volume of 1,204,798 TEUs.

"With our operations already established solidly and profitably in the Philippines, Poland, and Brazil, ICTSI expects to further realize positive returns from its newly established Madagascar International Container Terminal in Tomasina," Razon said.

He said the Naha International Container Terminal in Okinawa, Japan offers ICTSI a gateway to the East China Sea and a major trading port in Okinawa, which can ideally serve vessels bound for North America and Europe.

"Industry experts and analysts foresee an unprecedented growth in global trade and commerce over the next five to 10 years. With that comes the imminent demand for quicker and safer delivery of and access to these goods. We now see shipping lines deploying larger and larger ships and opening up more intra-regional routes. As a result, more ports are opening up either for privatization or for sale to seasoned global port operators," Razon said.

"Our company is well poised to play a lead role amid these new challenges. The remarkable growth we have experienced in the last three years as evidenced by the continuous increase in volumes and revenue generated and profits earned, validates our strategy of focusing on mid-size terminals with strong growth potential. This, coupled with managing our financial resources is now serving us in good stead. The field is wide open for us to grow and we will continue to leverage on our gains to move us forward," he said.

ICTSI sold seven of its overseas port operations in 2001 to raise funds to settle debts, and it is now trying to rebuild its foreign port operations.

Last year, ICTSI reported a 17-percent rise in its net income to P1.34 billion, 34 percent of which came from overseas operations.

It handled consolidated volume of 1,838,451 TEUs, up 2.5 percent from 2004. Tecon Suape or TSSA in Brazil posted a record throughput of 179,473 TEUs or an increase of 26 percent as a result of investments in infrastructure, equipment and intensified marketing campaign.

The Baltic Container Terminal, on the other hand, posted a six-percent growth in volume to 395,757 TEUS last year. ICTSI has alloted $36 million for the expansion of BCT’s capacity to over 600,000 TEUs in the short-term and further to one million TEUs per annum. The initial stages of this expansion are being financed entirely by a 10-year loan signed in 2004.

 

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