Westports’ Q1 profit drops on higher fuel cost, absence of one-off gain

PETALING JAYA: The 17.6% decline in the net profit of Westports Holdings Bhd for the first quarter of financial year 2017, which came in at RM140.89 million compared with RM171.08 million in the preceding year’s corresponding quarter, is attributable mainly to higher fuel cost and the absence of an one-off gain from the disposal of investment in quoted shares.

Higher container throughput, which increased 1% from 2.41 million twenty-foot equivalent units (TEU) to 2.43 million TEUs, supported a 12.1% increase in revenue to RM520.93 million in the first quarter, from RM464.71 million a year before that.

On the back of changing market conditions, the port operator is looking to maintain the container throughput it achieved in 2016, when it handled some 9.95 million TEUs.

Westports CEO Ruben Emir Gnanalingam said in a statement that while the realignment in the container shipping industry has resulted in fewer clients, it has created larger alliances.

“To service these much bigger alliances, we believe our ongoing capacity expansion at Container Terminal 8 and Container Terminal 9 (CT8 & 9) would be able to meet their requirements better as well as providing our clients with the assurance that they can grow with us in the future”, he added.

With the expansion of CT8 consisting of a 300m wharf and supporting terminal operating equipment slated to start operations in the middle of this year, the port operator’s handling capacity will increase to 12.5 million TEUs.

Its CT9 expansion consisting of a 600m wharf, meanwhile, is expected to be completed by the end of the year.

Last year, Westports recorded a capacity utilisation of 87%, with up to 94% of space being taken up in certain months and it is looking to maximise efficiency this year.