HPH Trust ports see 7% decline in box throughput in first nine months

HIT Terminals

In the year-to-date September 2016, HPH Trust’s deep-water ports handled 7% less containers than during the same period last year. Box throughput fell 4% at Yantian International Container Terminal. Combined throughput at the Hong Kong facilities of HIT, Cosco-HIT and ACT sank 11%.

HPH Trust said outbound cargoes to the US and Europe showed a slight upward trend during the nine months under review. US trade rebounded in the third quarter compared to the second but the EU trade recovery slowed in the third quarter. YICT’s throughput dropped in the first nine months of 2016, due to the adverse impact of a decrease in empty and transhipment cargoes. The drop in HIT’s throughput was accredited to weaker intra-Asia and transhipment cargoes.

Revenue for the period also fell 7% to HK$9.55bn, a fall of HK$623.3m, compared to the first nine months of 2015. Net income, on the other hand, rose 2% to HK$2.24bn, HK$52.6m above last year’s total.

However, the favourable result was only achieved off the back of HIT’s rent and rates refund in 2016 and additional depreciation due to the change of an accounting estimate in 2015. Without the benefit of this inorganic boost the year-to-date September 2016 net profit would have been 12% below last year.


Looking ahead HPH said that growth in the US economy was likley to be blunted by a European malaise:

“Outbound cargoes to US showed a mild rebound in the third quarter of 2016 after a weak performance in the second quarter. US economy is regaining its growth momentum and economic activity has increased at a faster pace. On the other hand, the growth in outbound cargoes to Europe slowed down in the third quarter of 2016. Weak consumer sentiment, high unemployment rate and the knock-on effects from Brexitcontinue to affect its economic recovery and the pickup of the European trade.

“Other than the economic performance of the US and Europe, HPH Trust’s performance has also affected by the outcomes of structural changes occurring in the container shipping industry. The service rationalisation of various global shipping alliances has negatively impacted the transshipment volume of both HIT and YICT over the past few quarters,” HPH Trust said.

HPH Trust added that, given the soft trade outlook, management remains cautious on the expected cargo volumes for 2016 and will continue to focus on cost cutting.


Commenting on the results, Drewry Maritime Financial Research said: “We believe volumes have been moving from ports in Hong Kong and East Shenzhen to neighbouring ports of Guangzhou-Nansha and Shenzhen Chiwan. China Merchants Port Holdings at Shenzhen Chiwan reported throughput increases in the third quarter of 2016, while port volumes at Guangzhou-Nansha surged 9.5% year-on-year in July and August 2016.

“While HPH Trust’s average revenue yield per teu changed marginally in the quarter, the spare capacity from soft transhipment volumes meant that inflation in costs would cut deeper on profits.

“Structural decline in Hong Kong’s transhipment volume is likely to continue, while Yantian offers a glimmer of hope as local authorities have been promoting trade in the city’s eastern zone,” the analyst concluded.

Be the first to comment

Leave a Reply

Your email address will not be published.


5 × 6 =