PSE Circular for Brokers No. 233-98

February 27, 1998 PSE CIRCULAR FOR BROKERS NO. 233-98 SEC FORM 11-C CURRENT REPORT UNDER SECTION-11 OF THE REVISED SECURITIES ACT (RSA) AND RSA RULE 11(a)-1(b)(3) THEREUNDER 1. Date of report 26 February 1998 2. SEC Identification Number 147212 3. BIR Tax Identification Number 000-323-228 4. Registrant International Container Terminal Services, Inc. 5. Country of Incorporation Philippines 6. Industry Classification Code 7. Address of principal office ICTSI Administration Building, MICT South Access Road, North Harbour, Manila Postal Code: 1012 8. Registrant's telephone number (632) 245-4101 9. Securities registered pursuant to Sections 4 and 8 of the RSA Titles of class Number of shares outstanding Common shares 1,367,968,875 shares 10. Item number reported herein: Item 9 Other Events : Unaudited consolidated year-end results of operations Based on unaudited consolidated financial statements for the period ended 31 December 1997, ICTSI posted revenues of P2.7 billion and total net income of P299 million in 1997. The revenue growth of 6 per cent. from last year's P2.55 billion was primarily attributed to a 6.4 per cent increase in volume handled at the MICT, from 848,017 TEUs in 1996 to 901,881 TEUs in 1997. The estimated after-tax earnings for the year of P299 million is 37 per cent lower than last year's P475 million. Total net income included income generated at the MICT, ICTSI's share in the net equity of its foreign operations in Argentina and Mexico and adjustments to reflect the recent peso: USdollar exchange rate depreciation. Terminal 5 in Buenos Aires, Argentina handled 236,700 TEUs, while the specialized container terminal in Veracruz, Mexico handled 287,600 TEUs during the year. Total income generated from the company's subsidiaries amounted to approximately P254.7 million, 240% higher than the P75 million booked last year. Item 10 Finance Statements/Exhibits The unaudited interim consolidated financial statements of the Company are filed as part of this Form 11-C on pages 3 to 5. Pursuant to the requirements of the Revised Securities Act, the registrant has duly caused this report to be signed on its behalf by the undersigned hereto duly authorized. INTERNATIONAL CONTAINER TERMINAL SERVICES, INC. By: (SGD.) ROGELIO C. SALAZAR President INTERNATIONAL CONTAINER TERMINAL SERVICES, INC . STATEMENTS OF INCOME AND RETAINED EARNINGS (Unaudited Consolidated) (in PhP000) Twelve Months Ended Quarter Ended December 31 1997 1996 1997 1996 GROSS REVENUES 2,701,235 2,547,435 679,971 637,366 LESS: PPA Fees 781,593 658,036 217,982 168,127 NET REVENUES 1,919,642 1,889,399 461,989 469,239 Administrative and Operating Expenses 1,215,647 1,088,928 331,663 245,418 PROFIT FROM OPERATIONS 703,996 800,471 130,326 223,821 OTHER INCOME (CHARGE) Interest Net (301,703) (207,112) (120,358) (38,101) Others (101,909) 149 (94,128) (13,151) Equity in net earnings-foreign subsidiaries 254,720 74,594 120,192 30,408 (148,892) (132,369) (94,294) (20,844) Profit before extraordinary items 555,104 668,102 36,032 202,977 Extraordinary items: Unrealized foreign exchange loss (80,889) (8,478) Realized foreign exchange gain/(loss) (3,955) (40,493) Loss on extinguishment of debt (64,127) Cost of labor restructuring (15,150) Profit after extraordinary items 390,982 668,102 (12,939) 202,977 Provision for income tax 91,608 193,367 (11,356) 56,782 NET PROFIT AFTER TAX 299,374 474,735 (1,583) 146,195 Retained Earnings Beginning 1,125,081 936,639 966,843 1,265,179 Transfer of revaluation increment 2,619 2,619 655 2,619 Stock Dividend's (464,120) (288,912) (2,960) (288,912) Retained Earnings End 962,955 1,125,081 962,955 1,125,081 INTERNATIONAL CONTAINER TERMINAL SERVICES, INC . STATEMENTS OF CASH FLOWS (Unaudited Consolidated) (in Php 000) Year Ended Quarter Ended December 31 1997 1996 1997 CASH FLOWS FROM OPERATING ACTIVITIES Net income 299,375 474,735 (1,583) Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 396,510 285,576 52,597 Provision for contingencies (4,000) (4,000) Loss on extinguishment of long-term debt 64,127 (34,531) Loss on sale of marketable equity securities 15,918 (6,118) Provision for (benefit from) deferred income tax (86,079) 16,820 (67,877) Gain on sale of property and equipment 24,515 49,819 Others 112,768 112,768 Equity in net losses (earnings) of investees (254,709) (74,594) (120,181) Changes in assets and liabilities: Decrease (increase) in: Accounts receivable Trade 16,042 (56,610) (2,612) Spare parts and supplies (104,022) (646) (69,120) Prepaid expenses and other current assets (223,258) (333,227) 31,514 Increase (decrease) in: Accounts payable and accrued expenses 242,318 18,672 236,811 Income tax payable 52,866 (6,184) 46,394 Net cash provided by operating activities 552,370 318,424 229,999 CASH FLOWS FROM INVESTING ACTIVITIES Additions to: Investments in shares of stock (816,358) (13,479) (662,267) Property and equipment (814,113) (909,717) (401,241) Increase in other assets (960,748) (354,241) (371,002) Net cash used in investing activities (2,591,220) (1,277,437) (1,434,510) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from: Short-term borrowings 1,034,193 1,113,415 565,492 Long-term borrowings 3,774,300 279,883 15,089 Issuance of stocks 52,198 17,015 37,512 Payments of: Short-term borrowings (600,679) (875,852) (485,404) Long-term borrowings (1,561,470) (183,071) 5,708 Increase in minority interest 18,855 18,855 Net cash provided by (used in) financing activities 2,717,397 351,390 157,252 Effect of Exchange Rate Changes on Cash/Cash Equivalents 590,152 592,366 NET-INCREASE(DECREASE) IN CASH AND CASH EQUIVALENTS 1,268,698 (607,623) (454,893) CASH AND CASH EQUIVALENTS, BEGINNING 177,087 754,227 1,900,677 CASH AND CASH EQUIVALENTS, END 1,445,785 146,604 1,445,785 INTERNATIONAL CONTAINER TERMINAL SERVICES INC . BALANCE SHEETS (Unaudited Consolidated) (in PhP 000) For year ended Dec 31, 1997 For year ended Dec 31, 1996 ASSETS Current Assets Cash and cash equivalents 1,445,785 177,087 Accounts receivable 214,725 230,767 Spare parts and supplies 223,574 119,552 Prepaid expenses and other current assets Total Current Assets 2,370,817 893,139 Investments in Shares of Stock 2,667,353 1,102,865 Property and Equipment net 5,038,432 4,117,686 Other Assets net 2,566,852 642,184 TOTAL ASSETS 12,643,455 6,755,874 LIABILITIES AND EQUITY Current Liabilities Loans payable 778,569 562,014 Accounts payable and accrued expenses 451,398 291,828 Income tax payable 64,815 40,274 Current portion of long-term debt 687,966 314,530 Total Current Liabilities 1,962,747 1,208,646 Long-Term Liabilities (net of current portion) 7,072,981 2,910,512 Deferred Income Tax 46,109 46,110 Deferred Credits 30,610 Minority Interest 141,355 122,500 Subscription Payable 48,139 Stockholders' Equity Capital stock 1,367,969 858,780 Additional paid-in capital 2,473,528 2,062,704 Revaluation increment 16,584 19,202 Share in translation adjustment 59,677 (28,355) Retained earnings 982,954 1,125,081 Shares held by a subsidiary (1,559,199) (1,569,306) Total Stockholders' Equity 3,321,512 2,455,106 TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY 12,643,455 6,755,874