KUALA LUMPUR: Westports Holdings Bhd’s third quarter net profit rose by 28% to RM203.85mil from a year ago as container throughput improved following a resumption in global economic activities.
It announced on Thursday the earnings rebounded from RM159.23mil a year ago as throughout rose by 6% to 2.93 million twenty-foot-equivalent units (TEUs) as global economic activities resumed after the earlier lockdowns. Both local and transhipment containers saw volume increases.
Its revenue increased by 14.7% to RM528.36mil from RM460.43mil. Earnings per share were 5.98 sen compared with 4.67 sen.
Westports temporarily adopted a payout ratio of 60% to conserve cash as it expects the land reclamation for the multi-billion container terminal expansion to start in 2021.
For the nine months, its net profit rose by 5.5% to RM490.99mil from RM465.45mil a year ago. Revenue increased by 7.7% to RM1.43bil from RM1.33bil.
Westports handled lesser container throughput of 7.73 million TEUs in January-September as container volume and demand was affected by the various forms of lockdown, especially in the previous quarter, to minimise the transmission of the Covid-19.
Westports invested RM213mil in capital expenditure 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, ” it said.
For 3Q and the nine months, Westports said some of the increase was due to construction activities arising from development work on a new liquid bulk jetty and CT9’s new Container Yard Zone Z.
Westports group managing director Datuk Ruben Emir Gnanalingam said Westports container volume declined by 4% in January-September despite a pandemic affected year because the rebound in the 3Q.
He said the rebound was because in 3Q, many countries emerged from the various forms of lockdown arrangements or movement restrictions. Hence, 3Q cushioned the decline during the first six months of the year.
“As we enter into 4Q, 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 2Q, as societies and economies adjust to these movement restrictions, ” he said.
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”.
Did you find this article insightful?
100% readers found this article insightful