PROFITS of International Container Terminal Services, Inc. (ICTSI) last year plunged 52% to $100.4 million, attributable to non-recurring charges recorded during the period.

In a statement yesterday, the Razon-led port operator said its attributable net income last year was pulled by non-recurring charges amounting to $158.7 million. This tempered the 7% rise in revenues to $1.5 billion.

The bulk of the non-recurring charges are the $156-million impairment charges from the company’s operations of the Tecplata S.A terminal in Buenos Aires, Argentina. It was a result of lower projected cash flows in the terminal due to an updated business plan to address the “prevailing and challenging economic conditions in Argentina.”

The balance of the charges is the $2.7-million charge on the acceleration of the company’s debt issue cost, following its partial prepayment of its euro-denominated term loan.

Without the non-recurring gains and charges, ICTSI’s recurring net income last year grew 23% to $259.1 million.

The single-digit rise in revenues is due to a 5% increase in consolidated volume at 10.18 million twenty-foot equivalent units (TEUs). This is mainly from new terminals in Papua New Guinea and Brazil; improved activity in Subic, Congo and Iraq; and new shipping contracts in Australia, Poland, Croatia, Georgia and Mexico.

Consolidated cash expenses recorded a 3% uptick to $464.2 million, largely from the increase in volume handled, salary rate adjustments and unfavorable foreign exchange rates.

“ICTSI delivered a positive performance in 2019 with revenue and EBITDA increasing by 7% and 10%, respectively,” ICTSI Chairman Enrique K. Razon, Jr. said in the statement.

He noted, however, that the coronavirus disease 2019 (COVID-19) outbreak is challenging its volumes, especially in operations in Asia.

“[W]e are closely reviewing developments across the regions in which we operate. Whilst we cannot be certain how long this situation will last; we are seeking to mitigate this impact through rigorous cost control and increasing market share,” Mr. Razon said.

“ICTSI is an agile business and able to act swiftly to ensure the business remains robust during these uncertain times,” he added.

The company is allocating $270 million for capital expenditures (capex) this year, which it will use for the expansion of its terminals in Manila, Mexico and Congo. It spent $240.8 million in capex last year, 63% of its allocation of $380 million.

Shares in ICTSI at the stock exchange fell 60 centavos or 0.57% to P105.10 apiece on Thursday. — Denise A. Valdez

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