ICTSI records strong growth amid global challenges

By Francis Allan L. Angelo

Amid a complex geopolitical landscape, International Container Terminal Services, Inc. (ICTSI) has reported a substantial increase in its financial performance for the fiscal year 2023.

Chairman and President Enrique K. Razon heralded the company’s achievements after it “delivered industry outperformance, illustrating the strength of its diversified portfolio and operating strategy.”

“I am proud of the Group’s performance in 2023; the efforts of ICTSI’s colleagues around the world have resulted in revenues increasing by six percent to US$2.39 billion and record EBITDA of US$1.51 billion.”

Despite the challenges, ICTSI saw a throughput growth of 4% to 12.75 million twenty-foot equivalent units (TEUs) and an increase in revenues by 6% to US$2.39 billion.

The company also achieved a 7% rise in Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA), reaching a record high of US$1.51 billion.

This performance underscores the strength of its diversified portfolio and a strategic operating approach coupled with rigorous financial discipline.

Razon remained optimistic about the future.

“While the geopolitical backdrop remains complex, 2024 is set to be ripe with opportunities as we continue to invest in new and existing terminals. We have a stronger platform than ever to grow, to drive market share and continue our successful track record as a responsible business that creates long-term sustainable value for all its stakeholders.”

ICTSI’s net income attributable to equity holders stood at US$511.53 million, a 17% decrease from the previous year’s US$618.46 million.

This decline was primarily due to non-recurring and non-cash impairment charges related to the acquisition of Pakistan International Container Terminal (PICT) and other noncurrent assets.

However, when excluding these charges, net income would have seen a growth of 7% to US$676.83 million.

The company’s consolidated volume increase was mainly attributed to the performance of Manila North Harbour Port, Inc. (MNHPI), which was consolidated in September 2022, improved trade activities, and new services at certain terminals.

The increase was offset partially by the expiration of the concession contract at PICT and a slowdown at several other terminals.

Gross revenues from port operations saw a similar uptick due to the MNHPI contribution, tariff adjustments, volume growth, and higher revenues from ancillary services.

The favorable currency translation effects in Mexico, Iraq, and Brazil also contributed positively, while the cessation of operations at several terminals and currency impacts in the Philippines and Australia partially offset these gains.

Operating expenses increased by 8% to US$662.70 million due to the inclusion of MNHPI and new business ventures, government-mandated salary rate adjustments, and other operational costs.

However, cost optimization measures and favorable exchange rates helped mitigate these increases.

The financial results reflect ICTSI’s continued commitment to expansion and development across its global operations, which include significant capital expenditure plans for 2024, estimated at approximately US$450 million.

This investment is set to complete expansions in Brazil and Indonesia, continue ongoing projects in Mexico, the Philippines, and the Democratic Republic of Congo, and support new developments in Iloilo, Philippines.