Q1 2017 Trading Statement

RNS Number : 0048I

Global Ports Holding PLC

14 June 2017

 

GLOBAL PORTS HOLDING Plc ANNOUNCEMENT

 The CEO Mr. Emre SAYIN and the senior management of Global Ports Holding Plc will hold a conference call with equity investors and analyst to discuss Q1 2017 results on June 14, 2017 at 10:00 UK. Below are the details for conference call.

ITFS List for Participant Connection / Participant Pin Code: 88565008#

UK:	[phone]
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Austria:	[phone]
France:	[phone]
Germany:	[phone]
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Netherlands:	+ 31 107138194
Italy:	[phone]
Portugal:	[phone]
UAE:	800035702760
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The purpose of this announcement is to update equity investors that Global Ports Holding Plc's ("GPH Plc" or "Group") 100% subsidiary Global Liman İşletmeleri A.Ş. ("GPH AS") has released its IFRS financials as of 31.03.2017, and that GPH AS' financials represent the Group's operational performance. GPH Plc was incorporated in preparation for the IPO, and it has conducted no business prior to completion of the IPO. All numbers reported in this announcement are GPH AS' IFRS financials as of 31.03.2017. GPH Plc will report its IFRS financials for the first time for the period ending 30.06.2017. Please note that there is no difference between GPH Plc and GPH AS in terms of operational performance for Q1-2017.

Global Ports Holding Plc

Q1 2017 Trading Statement

Q1 2017 results in line with management expectations in a traditionally quiet period of the year                   
 

Key Financials & KPI Highlights

	Q1 2016	Q1 2017	YoY Change
Passengers ('000 PAX) 3	256.0	314.8	22.9%
General & Bulk Cargo ('000 tons)	446.4	485.2	8.7%
Throughput ('000 TEU)	52.2	48.8	-6.6%
Revenue (US$ mn)	18.5	18.2	-1.7%
Cruise Revenue (US$ mn) 1	4.5	4.5	-0.3%
Commercial Revenue (US$ mn)	14.1	13.8	-2.1%
Segmental EBITDA (US$ mn) 2	10.9	11.4	4.9%
Segmental EBITDA Margin	58.7%	62.6%	+390bps
Cruise EBITDA (US$ mn)	1.7	1.6	-3.9%
Cruise Margin	37.6%	36.2%	-140bps
Commercial EBITDA (US$ mn)	9.2	9.8	6.5%
Commercial Margin	65.4%	71.1%	+570bps
1 Revenue allocated to cruise segment includes sum of revenues of cruise ports excluding Singapore and Lisbon
2 Segmental EBITDA figures indicate only operational companies; excludes GPH solo expenses
3 Passenger numbers refer to consolidation perimeter, hence excluding equity pick-up entities Venice, Lisbon and Singapore

Global Ports Holding Plc ("GPH Plc" or "Group"), the world's largest independent cruise port operator, today issues a trading update for the period from 1 January to 31 March 2017.

Due to the seasonal nature of the business, the first quarter of the year is always the least busy period for both the cruise and the commercial divisions of GPH Plc, and as such does not inform the trend for the full year. However, the Group is pleased to confirm that financial performance for Q1 2017 is in line with management's expectations, as set out at its recent Initial Public Offering on the London Stock Exchange.

Q1 Highlights:

·     22.9% growth in cruise passengers (of which 12.1% was organic growth, the inorganic growth was due to first-time consolidation of small Italian ports), with good growth across the majority of ports slightly offset by continuing challenges in our Turkish ports.

·     Took opportunity of the quieter cruise period to renovate the shopping mall in Ege Port with a small impact on revenue and EBITDA.

·     Good growth in our commercial ports with general & bulk cargo up by 8.7% YoY to 485.2k tons, offset by a small decrease in container volumes which were impacted by low seasonality.

·     In our quietest quarter, total consolidated revenues were broadly flat (-1.7% YoY) at USD 18.2mn.

·     However, segmental EBITDA rose 4.9% to USD 11.4mn with an improved margin of 62.6% vs. 58.7% in Q1 2016 as efficiency and FX benefits in our Commercial operations more than offset the impact of marginally lower revenue.

Outlook & current trading

Trading since quarter close has been strong with continued good growth in cruise passengers and container volumes. As a result, we remain confident of delivering on our expectations for the full year. 

Mehmet Kutman, Chairman and Co-Founder said;

"We are pleased with this set of results, which are our first as a publicly-listed company. As the world's largest independent cruise port operator, by number of ports and passengers, we enjoy a first mover advantage in this sector and have significant growth opportunities. We will continue to deliver on our ambitious plans to expand our existing footprint of 14 ports in eight countries, through acquisitions across Europe, the Caribbean and Asia."

Emre Sayın, Chief Executive Officer said;                                          

"I am delighted to have successfully completed the IPO of GPH and particularly welcome our new shareholders as we embark on the next stage in GPH's exciting growth strategy.

In what is traditionally the quietest quarter for us I am pleased that we have continued to grow passenger numbers organically and that we are starting to see the benefits of further efficiencies in our commercial business. Progress since the end of the quarter is also strong across the business which gives me increased confidence that we will meet our expectations for the full year"

Operational Review

Revenues broadly in line with Q1 2016 …

§ Total consolidated revenues were USD 18.2mn in Q1 2017, broadly flat (-1.7%) on Q1 2016, and impacted slightly by continued challenging conditions in our Turkish Ports as well as renovation works in Ege Port's shopping mall. However, these works have been completed prior to this year's main season

o  Adjusted for the effect of renovation works in Ege Port's shopping mall, total revenues in Q1 2017 were slightly higher than last year's.

§ Total cruise revenues remained largely flat YoY, with a positive contribution from passenger growth, offset by renovation works at Ege Port's shopping mall along with the depreciation in the €/$ parity and less contribution from other revenue streams (i.e. commercial berthing). Also, calls during the first quarter benefit from winter rates which are discounted and lead to lower revenues growth compared to passenger growth.

§ Total commercial revenues were USD 13.8mn in Q1 2017, down 2.1% YoY, due to lower revenue contribution from Port of Adria.

… while EBITDA and EBITDA margin improved

§ Total segmental EBITDA was USD 11.4mn in Q1 2017, up 4.9% on Q1 2016, with a 360bps improvement in margin (62.6% Q1 2017 vs. 58.7% Q1 2016).

o  When adjusting for the effect of the renovation works in Ege Port's shopping mall consolidated EBITDA was up by 7.4% YoY translating into 540bps improvement in EBITDA margin, which stood at a solid 64.1%.

§ Cruise EBITDA was USD 1.6mn in Q1 2017, down 3.9% on Q1 2016, with a margin of 36.2% (37.6% in Q1 2016). 

o  The decline in the cruise segment's operational profitability is mainly attributable to the negative contribution from Ege Ports in Turkey due to renovation works in the shopping mall. Ege Ports normally operates at 75%-80% EBITDA margin (FY 2016 EBITDA Margin of Ege Ports was 77%).

o  When adjusting for the Ege Port's shopping mall renovation impact, Cruise EBITDA grew 12.7% YoY with a 490bps improvement in margin (42.5% Q1 2017 vs. 37.6% Q1 2016).

§ Commercial EBITDA was USD 9.8mn in Q1 2017, up 6.5% on Q1 2016, translating into c.570bps improvement in EBITDA margin.

o  The improvement was driven by a favorable currency environment, increases in TEU yields at Port Akdeniz, and increased efficiency at Port of Adria thanks to the continued investments in equipment and the social program of 2016

Solid Balance Sheet

§ Net debt at 31.03.2017 increased to USD293mn from USD284mn at 2016YE due to capex.

o  Capital expenditures amounted to USD 6.7mn in Q1 2017, relating to the completion of the modernization program at Port of Adria (investment in equipment and machinery), as well as renovation works in Ege Port's shopping mall.

§ Gross Debt at 31.03.2017 equals USD 346mn. The Leverage Ratio as per GPH's Eurobond (excluding Unrestricted Subsidiaries) stood at 4.4x as of 31.03.2017, comfortably below the covenant of 5.0x.

CONTACT

For investor and analyst enquiries:

Global Ports Holding, Investor Relations

Asli Su Ata, Head of Investor Relations

Ismail Ozer, Investor Relations Analyst

Telephone: [phone]

Email: [e-mail]

For media enquiries:

Brunswick Group LLP    Azadeh Varzi   Imran Jina   Telephone: [phone]    Email: [e-mail]

APPENDIX

Please note that the numbers below are GPH AS IFRS financials as of 31.03.2017, and differences may arise between GPH AS and GPH Plc numbers on Balance Sheet and below-EBITDA items.

Summary Income Statement

US$m	Q1 2016	Q1 2017	Q1 2017
Consolidated statement of comprehensive income data
Revenue	18.5	18.2	-1.7%
Operating Expenses	(20.0)	(18.7)	-6.6%
Depreciation and Amortization	(10.1)	(10.1)	0.1%
Other Operating Income	0.1	0.6	659.9%
Other Operating Expense	(1.2)	(1.3)	13.9%
Operating profit	(2.5)	(1.1)	-55.5%
Finance Income	6.6	5.6	-15.3%
Finance Expenses	(11.5)	(10.7)	-7.5%
Profit before income tax	(7.0)	(5.7)	-7.5%
Income tax expense	0.8	0.9	10.1%
Profit for the year	(6.2)	(4.9)	-21.1%
Other financial data (USD millions actual)
EBITDA	9.9	10.3	4.6%
EBITDA margin	53.2%	56.5%	+330bps

Summary Balance Sheet

US$m	2016	31.03.2017
Consolidated statement of financial position data (USD millions)
Cash and cash equivalents	44.3	38.8
Total current assets	111.9	105.4
Total assets	699.9	704.4
Total debt (including obligations under financing leases)	342.7	346.3
Net debt (including obligations under financing leases)	298.4	307.5
Total equity	222.5	201.5
of which retained earnings	43.6	12.5

Summary Cash Flow Statement

US$m	Q1 2016	Q1 2017
Consolidated cash flow statement data (USD millions)
Net cash provided by operating activities	9.5	8.1
of which generated from operations	8.6	9.7
of which net working capital	0.9	(1.6)
Net cash (used in) / produced from investing activities	(7.0)	(5.9)
Net cash (used in) / produced from financing activities	(34.5)	(4.4)

 

END

 

 

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