FINANCIAL RESULTS ANNOUNCEMENT – WESTPORTS HANDLED CONTAINER VOLUME OF 7.7 MILLION TWENTY-FOOT EQUIVALENT UNITS (“TEUS”) IN FIRST 9 MONTHS OF 2020
Kuala Lumpur, 26 November 2020
Westports Holdings Berhad (“Westports” or the “Company”) has announced its financial results for the 3rd Quarter of 2020 and the 9-month ended on 30 September 2020. At the top-line, the Company’s total revenue improved to RM1.43 billion for the nine-month period. Some of the increase was attributable to construction activities arising from development work on a new liquid bulk jetty and CT9’s new Container Yard Zone Z. At the bottom line, after tax provision of RM156 million or an effective tax rate of 24%, Westports reported a Profit After Tax of RM491 million.
Datuk Ruben Emir Gnanalingam, Group Managing Director of Westports, shared that “Westports container volume declined by 4% for the first nine months of 2020 despite a pandemic affected year because the rebound in the 3rd Quarter, after many countries emerged from the various forms of lockdown arrangements or movement restrictions, has cushioned the decline during the first six months of the year. As we enter into the 4th Quarter of 2020, many regions and cities have reimposed various forms of lockdown again. However, we cautiously expect a less adverse impact from the latest lockdown, compared to the 2nd Quarter of 2020, as societies and economies adjust to these movement restrictions”.
Datuk Ruben cautioned that “the long-tail effects of COVID-19 is altering global consumption and economic activities as the world adjusts to a “new normal”. The secondary redistributive effects on society by the pandemic is a reminder that the importance of social contribution to the community and the less-advantaged is more needed than ever. Towards that end, the Company will be channelling assistance and greater engagement with the community through Westports Foundation in 2021”.
The Group Managing Director concluded that “The momentary pause in the relentless volume growth in recent years has provided Westports time to evaluate, plan and strategise for the next phase of growth. This ranges from ongoing process improvements to streamline remote or electronic processing and to prepare and plan for the mega Container Terminal expansion from CT10 to CT17. Westports is committed to reinforcing Port Klang as one of the main transhipment hubs in South East Asia for international container shipping alliances”.
Westports handled lesser container throughput of 7.73 million TEUs during the first nine months of 2020 as container volume and demand was affected by the various forms of lockdown, especially in the previous quarter, to minimise the transmission of the coronavirus disease (“COVID-19”).
Container throughput improved in the Third Quarter of 2020 with a 6% growth to 2.93 million TEUs as global economic activities resumed after the earlier lockdowns. Both local and transhipment containers saw volume increases.
Westports invested RM213 million in capital expenditure during the first nine months of 2020 to enhance its container and conventional operational capabilities despite a lower level of container throughput. The added investments will support the long-term growth of the Company and also Port Klang.
For the first nine months of 2020, after tax provision of RM156 million or an effective tax rate of 24%, Westports reported a Profit After Tax of RM491 million.
Westports has temporarily adopted a payout ratio of 60% to conserve cash as it expects the land reclamation for the multi-billion Container Terminal expansion to commence in 2021. The Company paid its first interim ordinary dividend amounting to RM172.2 million in August 2020. The second interim ordinary dividend usually to be paid in March of the following year.
Westports has achieved a new container volume record by handling 23,183 TEUs on one vessel, the 400-metre CMA CGM Antoine de Saint Exupery, when she called at Westports in the first week of November 2020 during her regular eastbound FAL 1 service. Westports deployed 9 Ship-To-Shore Cranes in the record-breaking 46-hour operations.
Westports has contributed a total of RM2.6 million for COVID-19 related assistance to hospitals and the surrounding community. For 2021, the Company will be undertaking its contribution to the community through the Westports Foundation.