Westports Holdings Berhad (“Westports”) would like to provide an update on our container volume achieved for the five-month period ended 31 May 2017. This is to ensure fair disclosure and thorough public dissemination to all shareholders and stakeholders as in accordance to international best practices and Bursa Malaysia Securities Berhad Main Market Listing Requirements.
Westports achieved 1% growth in container volume to 2.4 million twenty-foot equivalent units (“TEUs”) for the first quarter ended 31 March 2017. In the same Quarterly Financial Report, we had indicated in the 'Current Year's Prospects' that we target to maintain similar container throughput as that achieved in 2016.
We would like to disclose that for the month of April 2017 to May 2017, we have recorded lower volume than originally expected. Westports handled 3.95 million TEUs for the five-month period ending in May, which is lower by 3% when compared to the corresponding period last year. Please also note that the corresponding quarter last year was a record quarter and the fastest growing period for us in 2016.
We had originally expected to still grow our volume this quarter due to an increased amount of transitional moves or ad hoc calls as a result of the changes in shipping alliances. However, these did not materialise as planned due to the fact that competition for these volumes were intense.
The realignment of the container shipping industry from 1 April 2017 saw the phasing-out of previous services under the Ocean 3 Alliance (“O3”), CKYHE and G6 and the gradual phasing-in of services under the new Ocean Alliance and THE Alliance. The first vessel call at Westports under the Ocean Alliance was on 6 April 2017.
Under O3, our services were more spread out across the regions. In Ocean Alliance and THE Alliance, most of the 12 services that would be calling at Westports are more eastbound-focused services than westbound services. The vessels for these services will need to sail from the East, such as China, towards their final destinations in the West, such as Europe, and then back to the East again and they will call at Westports only on the backhaul segment of their voyage. Due to the number of weeks sailing from the East to the West and then only back to the East, Westports terminal would only handle some of these vessels’ container requirements in the latter part of May or even June 2017.
With the more moderate container throughput, we now expect the year’s overall container volume to be lower than the previous year by a single-digit percentage.
On a separate note, the container volume mix is more favourable as there is stronger growth momentum of higher yielding laden gateway boxes. The overall container terminal utilisation has now shifted to more optimum levels that would facilitate Westports’ focus on enhancing its service quality levels, improved efficiency and also productivity levels. Meanwhile, the capacity expansion at CT 8 Phase 2 and CT 9 Phase 1 would also accommodate the resumption of volume growth after the current recalibration process within the container shipping industry.
Westports will disclose the overall container volume for the six-month period ending 30 June 2017 when the Quarterly Financial Report for the second quarter is announced by the end of July 2017.
This announcement is dated 1 June 2017.
About Westports Holdings Berhad
Westports Holdings Berhad was listed on the Main Market of Bursa Malaysia Securities Berhad on 18 October 2013 and is the largest listed port operator in Malaysia. Westports is strategically located in Port Klang along the Straits of Malacca. The Company is involved in container and conventional cargo handling as well as providing a wide range of port services, including marine, rental and other ancillary services.
Important notice
This document contains certain forward-looking statements with respect to Westports’ financial condition, results of operations and business, and management’s strategy, plans and objectives of Westports. These statements include without limitation, those that express forecasts, expectations and projections such as forecasts, expectations and projections in relation to new products and services, revenue, profit, cash flow, operational metrics etc. These statements (and all other forward-looking statements, contained in this document) are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond Westports’ control, are difficult to predict and could cause actual results to differ materially from those expressed or implied or forecast in the forward-looking statements.
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