ICTSI 1H income up 35%

August 16, 1999 PSE CIRCULAR FOR BROKERS NO. 2033-99 August 13, 1999 PRESS RELEASE ICTSI 1H income up 35% International Container Terminal Services, Inc. (ICTSI) posted consolidated net income of PhP251.4 million in the first half of the year, up 35 per cent from 1998 1H net income of PhP186 million. Net income increased primarily because of the improved performance from the Manila International Container Terminal (MICT) and from most of the terminals managed by ICTSI International Holdings Corp. (IIHC). IIHC holds ICTSI's interests in its overseas operations. Consolidated net income for the second quarter increased by 31 percent, from PhP138.6 million in 1998 to PhP182.2 million in 1999. In the first half of the year, consolidated volumes grew by 15 per cent, from 704,480 TEUs in 1998 to 806,541 TEUs in 1999. Volumes handled at the MICT increased by 15 per cent, from 354,121 TEUs to 405,807 TEUs. Volumes from IIHC consolidated subsidiaries increased by 14 per cent, from 360,359 TEUs in 1998 to 400,734 TEUs in 1999. IIHC subsidiary Internacional de Contenedores Asociados de Veracruz, S. A. de C. V. (ICAVE) in Mexico handled 192,705 TEUs, up 18 percent from 163,497 TEUs. Another subsidiary, International Ports Services Co. Ltd. (IPS), in Saudi Arabia handled 201,291 TEUs, up eight percent from 186,862 TEUs, Ensenada International Terminal, S. A. de C. V. (EIT) in Mexico, another subsidiary, handled 6,738 TEUs. EIT began operating only in the first half of this year. On a quarterly basis, consolidated volumes increased by 20 percent, from 361,466 TEUs in 1998 to 435,157 in 1999. MICT volumes grew by 24 percent, from 176,561 TEUs to 218,225 TEUs. IIHC volumes also grew by 17 percent, from 184,905 TEUs to 216,932 TEUs. IIHC volumes include volumes from ICAVE of 100,658 TEUs, from IPS of 111,211 TEUs, and from EIT of 5,063 TEUs. cdt As a result of rising volumes, ICTSI's consolidated gross revenues in the first half increased by 22 percent, from PhP2.8 billion in 1998 to PhP3.5 billion in 1999. Aside from local subsidiaries, revenue contributions came from the MICT of PhP1.5 billion, up 24 per cent from PhP1.2 billion; and from IIHC of PhP1.9 billion, up 21 percent from PhP1.6 billion. MICT's revenues were bolstered by a 10 per cent increase in arrastre effected in January this year. Another 10 per cent increase was effected in June this year. IIHC revenues came from ICAVE of PhP1.1 billion, up 23 per cent from PhP879 million; from IPS of PhP746 million, up seven per cent from PhP697 million; and from EIT of PhP33 million. Consolidated revenues for the second quarter rose by 16 per cent, from PhP1.5 billion in 1998 to PhP1.8 billion in 1999. MICT revenues increased by 24 per cent from PhP617.9 million to PhP832 million. IIHC revenues grew by five per cent, from PhP912.4 million to PhP956.8 million. Consolidated administrative and operating expenses for the first half increased by 14 per cent, from PhP1.4 billion in 1998 to PhP1.5 billion in 1999. MICT expenses decreased by four per cent, from PhP691.4 million to PhP666 million. On the other hand, IIHC expenses increased by 30 per cent, from PhP668 million to PhP870 million. On a quarterly basis, consolidated administrative and operating expenses increased by 14 per cent, from PhP667 million in 1998 to PhP762 million. MICT expenses by nine per cent, from PhP331 million to PhP359 million. IIHC expenses grew by 20 per cent, from PhP363 million to PhP425 million. Equity in net earnings for the first half from Buenos Aires Container Terminal Services, S. A. (BACTSSA) in Argentina and Karachi International Container Terminal Ltd. (KICT) in Pakistan decreased by 67 per cent, from PhP43.3 million to PhP14.4 million in 1999. The decline is attributable to IIHC's share in KICTs startup losses of PhP27.4 million, and to BACTSSA's decreased income contribution of PhP41.8 million, a result of the economic slowdown being experienced in Argentina. On a quarterly basis, equity in net earnings from BACTSSA and KICT translated to a loss of PhP3.96 from earnings of PhP16.7 million. For the quarter in review, IIHC's share in KICT's startup losses amounted to PhP12.8 million. On the other hand, BACTSSA's earnings declined from PhP15.9 million to PhP8.8 million. During the same period, BACTSSA handled 59,876 TEUs.