P&O Ports lifts group results at P&O

P&O Ports lifts group results at P&O    Stronger profits from port activities and the ending of losses at the P&O Nedlloyd joint venture allowed Peninsular & Oriental Steam Navigation Co. to return to profit in 2003, with a '50 million ($89 million) net result for the year.
   This marks a recovery from the net loss of '180 million reported by P&O in 2002.
   Group revenue decreased 8 percent last year to '4.1 billion ($7.4 billion) from '4.5 billion after the disposal of P&O’s contract logistics business.
   Group operating profit rose 45 percent to '175 million ($313 million) in 2003 from '121 million in 2002.
   P&O Ports continued to be the main contributor to the group’s profits. The ports arm made an operating gain of '129 million ($230 million) in 2003 up from '117 million in the previous year.
   P&O’s share of the operating result of P&O Nedlloyd for 2003 was a profit of '18 million ($32 million) as compared to a deficit of '86 million in 2002.
   P&O’s cold logistics arm increased its operating profit 33 percent in 2003, to '16 million ($29 million), from '12 million in 2002.
   However, P&O’s ferries division suffered a '40-million operating loss in 2003, as compared to a deficit of '13 million in the previous year.
   Exceptional items at P&O in 2003 were also more favorable than in the previous year.
   P&O Ports, seen as the star division of the P&O group, increased its revenue 19 percent last year to '945 million ($1.7 billion).
   On an equity-adjusted basis, P&O Ports raised its worldwide container throughput 27 percent in 2003 to 11.3 million TEUs from 8.9 million TEUs in 2002. Of the 27-percent growth, 20 percent was due to organic growth and the balance to additional terminals. During 2003, P&O Ports invested some '350 million ($625 million), mainly in the high growth Asian region, through both acquisitions and expansion.
   P&O Ports’ container terminal throughput in Asia rose 24 percent to 4.6 million TEUs in 2003.
   “Strong volume growth was achieved across almost all terminals, particularly in China, but also in India despite Mumbai operating at close to full capacity,” P&O said, commenting on its Asian port activities. In China, additional capacity at Shekou phase II came on stream in August and further capacity has been introduced at the start of 2004.
   P&O Ports’ box volume in the Americas rose 44 percent in 2003 to 1.8 million TEUs, after the company acquired terminals in Vancouver on the Canadian West Coast.
   The P&O group said it expects to continue to invest about '200 million ($357 million) a year in the ports business.
   “The company is continuing to reallocate capital to its strongest growth areas, primarily through property disposals and continued investment in ports,” it said. Once P&O has sold its 50-percent share in P&O Nedlloyd, the port division will account for about two thirds of the group's operating profit, P&O predicted.