HPHT profit falls amid lower container throughput and higher expenses

An aerial view of Singapore’s portAn aerial view of Singapore’s port

Hutchison Port Holdings Trust, or HPHT, reported on Monday that its second-quarter profit attributable to unit holders tumbled 36.8 percent on-year to HK$170 million and it issued a cautious outlook statement amid continued global trade tensions.

Revenue for the quarter ended 30 June slipped 3.6 percent on-year to HK$2.79 billion, the trust manager said in a filing after the market close on Monday.

Interest and other finance costs for the quarter rose 20.1 percent on-year to HK$252 million, mainly on higher HIBOR/ LIBOR applied on the bank loans’ interest rates, it said.

Other operating expenses also rose 15.0 percent on-year in the quarter to HK$156.1 million, mainly on an exchange loss from the revaluation of YICT’s net-yuan-denominated monetary assets, the filing said.

The combined container throughput of terminals at HPHT Kwai Tsing, Hong Kong, or HIT, COSCO-HIT and ACT, decreased by 7.2 percent,  compared with the year-earlier quarter, primarily on the decline in transshipment cargoes, the filing said. The container throughput of Yantian International Container Terminals, YICT, in Shenzhen, fell 4.1 percent compared with the year-earlier quarter, mainly due to a drop in empty cargoes,  partially offset by increase in the U.S. and transshipment cargoes, it said.

For the quarter, average revenue per TEU, or twenty-foot equivalent unit, for Hong Kong was higher on-year, mainly on the write-back of
agency fee provision following the finalisation of tariff negotiation, it said. For China, the average revenue per TEU rose on-year, mainly on yuan appreciation, partially offset by some tariff revisions after merger and acquisition activity between some liners in the latter half of 2017 and an increased transshipment mix, it said.

For the first half, revenue slipped 0.3 percent to HK$5.46 billion, while profit attributable to unit holders fell 27.7 percent to HK$315.4 million, it said.

In its outlook statement, the trust manager said it would be “vigilant and cautious” about the expected cargo volumes this year amid trade and geopolitical tensions, with plans for “strict financial discipline.”

“The level of uncertainty in political and economic relations as it pertains to trade has increased significantly over the course of the year to date and shows little sign of abating,” it said.

But it noted that the impact of any trade-related measures, particularly between the U.S. and China, “cannot readily be quantified” amid uncertainty over their specific nature, extent and timing as well as the impact they may actually have on local and global trade flows.


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