CP SHIPS “TO OUTPERFORM COMPETITORS”

CP SHIPS “TO OUTPERFORM COMPETITORS”

CP SHIPS “TO OUTPERFORM COMPETITORS”

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   Canadian Pacific predicted strong future results at CP Ships, the shipping arm of the group that includes Canada Maritime, Cast, Contship Containerlines, Lykes Lines and Australia-New Zealand Direct Line.
   “With our recent acquisitions, restructuring and cost-cutting, CP Ships is poised to outperform our competitors in difficult times and excel as market conditions improve,” said David O’Brien, chairman, president and chief executive officer of CP in a letter to shareholders.
   CP Ships acquired ANZDL in late 1998 and recently announced an agreement to buy the 50-percent share of the Americana Ships joint venture it did not already own from the Transportacion Maritima Mexicana group.
   In January, CP Ships reported a 44-percent drop in its full-year net income for 1999, to C$85 million (US$58 million) from C$151 million in 1998, while operating income decreased by 28 percent, to C$129 million (US$88
million).
   However, CP Ships said that freight rates are expected to improve in many of its trade lanes.
   Commenting on industry trends, O’Brien said that demand in the shipping market is growing, while supply is constrained with fewer new ships being built and a higher proportion of vessels being scrapped.
   After obtaining full ownership of Americana Ships, the container carrying volume of CP Ships will reach about 1.8 million TEUs a year, compared to 1.37 million TEUs carried in 1999, the company said.
   Americana Ships includes the services of TMM Lines and Transportacion Maritima Grancolombiana currently owned by Transportacion Maritima Mexicana.