Strong economy helps lift PSA Int'l gain to record $1.2b
PSA International turned in a record net profit of $1.209 billion for 2006, up 14.3 per cent over the previous year. This was aided by strong economic growth and despite a highly competitive global port operators' market.
Busy: Port revenues from Singapore operations formed 52 per cent of group turnover, a growth in line with the 7.6 per cent throughput increase
And for the first time in the group's history, its overseas terminals handled more container boxes, 27.31 million, than the 23.98 million throughput at Singapore.
The volumes handled here made PSA Singapore the busiest container port in the world again after it overtook Hong Kong in 2005.
PSA's Singapore Terminals saw a 7.6 per cent growth in boxes handled, while terminals in Europe, China and other parts of Asia moved 27.31 million TEUs (20-foot equivalent units) in 2006, a year-on-year increase of 30.2 per cent.
The group's coffers were fattened for the first time with contributions from its unexpected, but spectacular US$4.4 billion acquisition of a 20 per cent stake in Hong Kong's Hutchison Whampoa's global portfolio of ports.
PSA made its biggest investment in April last year in the parent company of the rival Hong Kong port operator, seeing good long-term value in Hutchison's ports, many of which are in high-volume and high-growth locations, including some of China's best performing container terminals.
The group's record global throughput of 51.29 million containers last year is an 18.6 per cent rise over that in 2005, and was a result of growth at its existing terminals and the acquisition of new port ventures.
Port revenues from Singapore operations formed 52 per cent of group turnover, which was a growth in line with the 7.6 per cent throughput increase and was achieved due to sustained strong trade growth from China and India, it said. PSA's European ports, on the other hand, contributed 33 per cent of group revenues, or $1.2 billion, which was a 6.6 per cent decline over 2005 due to the divestment of some non-core business in 2005 and the weakening of the euro, PSA said.
Though the double digit growth in total volume translated into a modest 1.6 per cent growth in revenue, profit after taxation was boosted by one-off gains, mainly attributable to higher interest and dividend income and gains from investment sales.
Sounding a note of caution, PSA said in a statement yesterday: 'The business environment for global port operators remained highly competitive as ships grew to unprecedented sizes resulting in shipping lines demanding bigger and improved terminal infrastructure, and shippers expecting higher quality services at competitive prices.' While global economic trade grew strongly in 2006, it was at a slower rate compared with 2005.
PSA International group CEO Eddie Teh said the main challenges for the group as it expands was to 'manage the upward trending cost arising from escalating fuel and material prices, an increasingly tight labour market, and a need to customise services to meet shipping lines' rigorous demands'.
PSA said it has made significant capital investments to build new berths at its Pasir Panjang Terminal in Singapore and at Antwerp's Deurganck terminal, in 'preparation for handling bigger ships and meeting more complex shipping requirements'.
PSA also increased its global presence further by securing concessions to build and operate in several new ports. In the first two months of this year alone the group tied up another six new port projects bringing its global total to 25 in 14 countries.
PSA group chairman Fock Siew Wah attributed the 2006 successes to PSA's harmonious relations among staff, unions and management and customers that brought the volumes that sustained creditable growth.
Busy: Port revenues from Singapore operations formed 52 per cent of group turnover, a growth in line with the 7.6 per cent throughput increase
And for the first time in the group's history, its overseas terminals handled more container boxes, 27.31 million, than the 23.98 million throughput at Singapore.
The volumes handled here made PSA Singapore the busiest container port in the world again after it overtook Hong Kong in 2005.
PSA's Singapore Terminals saw a 7.6 per cent growth in boxes handled, while terminals in Europe, China and other parts of Asia moved 27.31 million TEUs (20-foot equivalent units) in 2006, a year-on-year increase of 30.2 per cent.
The group's coffers were fattened for the first time with contributions from its unexpected, but spectacular US$4.4 billion acquisition of a 20 per cent stake in Hong Kong's Hutchison Whampoa's global portfolio of ports.
PSA made its biggest investment in April last year in the parent company of the rival Hong Kong port operator, seeing good long-term value in Hutchison's ports, many of which are in high-volume and high-growth locations, including some of China's best performing container terminals.
The group's record global throughput of 51.29 million containers last year is an 18.6 per cent rise over that in 2005, and was a result of growth at its existing terminals and the acquisition of new port ventures.
Port revenues from Singapore operations formed 52 per cent of group turnover, which was a growth in line with the 7.6 per cent throughput increase and was achieved due to sustained strong trade growth from China and India, it said. PSA's European ports, on the other hand, contributed 33 per cent of group revenues, or $1.2 billion, which was a 6.6 per cent decline over 2005 due to the divestment of some non-core business in 2005 and the weakening of the euro, PSA said.
Though the double digit growth in total volume translated into a modest 1.6 per cent growth in revenue, profit after taxation was boosted by one-off gains, mainly attributable to higher interest and dividend income and gains from investment sales.
Sounding a note of caution, PSA said in a statement yesterday: 'The business environment for global port operators remained highly competitive as ships grew to unprecedented sizes resulting in shipping lines demanding bigger and improved terminal infrastructure, and shippers expecting higher quality services at competitive prices.' While global economic trade grew strongly in 2006, it was at a slower rate compared with 2005.
PSA International group CEO Eddie Teh said the main challenges for the group as it expands was to 'manage the upward trending cost arising from escalating fuel and material prices, an increasingly tight labour market, and a need to customise services to meet shipping lines' rigorous demands'.
PSA said it has made significant capital investments to build new berths at its Pasir Panjang Terminal in Singapore and at Antwerp's Deurganck terminal, in 'preparation for handling bigger ships and meeting more complex shipping requirements'.
PSA also increased its global presence further by securing concessions to build and operate in several new ports. In the first two months of this year alone the group tied up another six new port projects bringing its global total to 25 in 14 countries.
PSA group chairman Fock Siew Wah attributed the 2006 successes to PSA's harmonious relations among staff, unions and management and customers that brought the volumes that sustained creditable growth.
