International Container Terminal Services, Inc. (ICTSI) reported audited consolidated financial results for 2021 posting revenue from port operations of US$1.87 billion, 24 percent higher compared to the US$1.51 billion reported last year; Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) of US$1.14 billion, 30 percent more than the US$876.83 million generated in 2020; and net income attributable to equity holders of US$428.57 million, 321 percent higher than the US$101.76 million earned in 2020 mainly due to higher operating income and non-recurring charges in 2020; partially off-set by increase in depreciation and amortization resulting from the new terminals; higher interest on loans, concession rights payable, and lease liabilities; additional impairment charges on other non-financial assets; and charges associated with the prepayment of loan facilities at Victoria International Container Terminal (VICT).
In addition, equity in net loss of joint ventures was practically reduced to zero in 2021 from a US$12.27 million loss in 2020 mainly due to the company’s share in higher net income in Manila North Harbour Port, Inc. (MNHPI) and lower net loss at Sociedad Puerto Industrial Aguadulce S.A. (SPIA) in 2021. Diluted earnings per share increased 813 percent to US$0.18 from US$0.02 in 2020. Excluding non-recurring charges, recurring net income attributable to equity holders of the parent in 2021 was 57 percent higher at US$442.83 million compared to the US$282.07 million earned the previous year.
In 2021, the company recognized additional non-recurring impairment charges on other non-financial assets and charges associated with the prepayment of loan facilities at VICT totaling US$16.74 million. In 2020, the non-recurring impairment charges on the concession rights of Tecplata S.A. (TECPLATA) and other nonfinancial assets amounted US$180.31 million.
ICTSI handled consolidated volume of 11,163,473 twenty-foot equivalent units (TEUs) in 2021, higher by 10 percent compared to the 10,193,384 TEUs handled in 2020 primarily due to volume growth and improvement in trade activities as economies recover from the impact of the COVID-19 pandemic and lockdown restrictions; and new contracts with shipping lines and services at certain terminals.
Excluding the contribution of the company’s new terminal operations, International Container Terminal Services Nigeria Ltd. (ICTSNL) in the Port of Onne, Rivers State, in Nigeria, consolidated volume would have increased by nine percent in 2021.
Gross revenues from port operations grew by 24 percent in 2021 to US$1.87 billion compared to the US$1.51 billion reported in 2020 mainly due to volume growth and improvement in trade activities at most terminals; favorable container mix; tariff adjustments at certain terminals; new contracts with shipping lines and services; higher revenues from ancillary services; contribution of new terminals - ICTSNL in Rivers State, Nigeria, Manila Harbor Center Port Services, Inc. (MHCPSI) in Manila, Philippines, Kribi Multipurpose Terminal (KMT) in Kribi, Cameroon, and IRB Logistica in Rio de Janeiro, Brazil; and net favorable impact of foreign exchange at certain terminals; partially tapered by decline in trade activities at certain terminals primarily due to the impact of COVID-19 pandemic. Excluding the contribution of new terminals in Nigeria, Philippines, Cameroon, and Brazil, consolidated gross revenues would have increased by 21 percent in 2021.
Consolidated cash operating expenses in 2021 was 15 percent higher at US$523.33 million compared to US$453.63 million in 2020. The increase in cash operating expenses was mainly due to increase in prices and consumption of fuel and power and higher contracted services driven by volume growth; additional cost associated with the new terminals in ICTSNL, MHCPSI, KMT and IRB Logistica; and unfavorable foreign exchange effect of Australian Dollars (AUD)-, Mexican Peso (MXN)- and Chinese Renminbi (RMB)- based expenses in Melbourne, Manzanillo and Yantai, respectively. This was partially tapered by continuous cost optimization measures; and favorable foreign exchange effect of Iraqi Dinar (IQD)-based expenses at ICTSI Iraq and Brazilian Reais (BRL)-based expenses at ICTSI Rio and Tecon Suape S.A. (TSSA). Excluding the cost associated with the new terminals, consolidated cash operating expenses would have increased by 12 percent.
Consolidated EBITDA increased 30 percent to US$1.14 billion in 2021 from US$876.83 million in 2020 primarily due to higher revenues and the contribution of new terminals, ICTSNL and MHCPSI; partially tapered by the increase in cash operating expenses. Excluding the contribution of new terminals, EBITDA would have increased by 27 percent. Concurrently, EBITDA margin increased to 61 percent in 2021 from 58 percent in 2020.
Consolidated financing charges and other expenses decreased 47 percent to US$170.54 million in 2021 from US$320.69 million in 2020 mainly due to lower impairment charges on non-financial assets and non-recurring charges associated with the prepayment of loan facilities at VICT totaling US$16.74 million in 2021 compared to the impairment charges on concession rights of TECPLATA and other nonfinancial assets in 2020 of US$180.31 million. This was partially offset by higher interest and financing charges on borrowings primarily due to the issuance US$400 million and US$300 million senior notes in June 2020 and November 2021, respectively; and the consolidation of the outstanding loan of the Group’s new terminal in the Philippines, MHCPSI.
Capital expenditures, excluding capitalized borrowing costs, in 2021 amounted to US$165.00 million. These were mainly for ongoing expansions at Manila International Container Terminal (MICT) in the Philippines, acquisition of port facilities and equipment at ICTSNL in Nigeria, other expansionary works at the company’s terminals in Democratic Republic of Congo, Australia and Mexico; and infrastructure and equipment upgrades in Ecuador. The Group’s capital expenditure budget for 2022 is approximately US$330.00 million. This will be utilized mainly for the payment of the concession extension upfront fees at Madagascar International Container Terminal Services Ltd. (MICTSL) in Madagascar; ongoing expansion at IDRC in Matadi, Democratic Republic of Congo; expansion projects at VICT in Melbourne, Australia and Contecon Manzanillo S.A. de C.V. (CMSA) in Manzanillo, Mexico which are both operating at very high utilization levels; Berth 8 expansion project at MICT in Manila, Philippines; equipment acquisitions and upgrades; and for various maintenance requirements.
ICTSI is a leading global developer, manager and operator of container terminals in the 50,000 to 3.5 million TEU/year range. ICTSI operates in six continents and continues to pursue container terminal opportunities around the world.
ABOUT INTERNATIONAL CONTAINER TERMINAL SERVICES, INC.
Headquartered and established in 1988 in Manila, Philippines, International Container Terminal Services, Inc. is in the business of port development, management and operations. ICTSI’s portfolio of terminals and projects are located in developed and emerging market economies in the Asia Pacific, the Americas, and Europe, the Middle East and Africa. Independent with no shipping or consignee-related interests, ICTSI works and transacts transparently with all stakeholders of the supply chain. ICTSI continues to receive global acclaim for its public-private partnerships, which are focused on sustainable development, and supported by corporate social responsibility initiatives.