19th Dec 2023 16:56
(Alliance News) - Global Ports PLC looks set for further success, said Shore Capital analysts on Tuesday, after the firm swung to profit in its latest half year results.
For the six months ended September 30, the London-based cruise port operator reported pretax profit of USD3.4 million, swung from a USD4.4 million loss the previous year.
Revenue, meanwhile, dropped 11% to USD105.6 million from USD118.3 million, despite passenger numbers jumping 54% to 6.7 million from 4.4 million.
Segmental earnings before interest, tax, depreciation and amortisation also rose 54% to USD67.6 million, while net loss widened to USD8.0 million from USD7.3 million while its loss per share reduced to 8.0 cents from 11.6 cents.
As Shore Capital analysts noted, Mediterranean ports were the largest profit contributor in the second quarter, demonstrating the "broadening geographic spread of the cruise portfolio".
The year-to-date has also been a busy period of development, as Global Ports completed its Nassau investment, extended the concession at the Turkish port, Ege, increased its holding in Barcelona Port Investments to 100%, and signed a 30-year concession for St Lucia.
Shore Capital foresees that the St Lucia and San Juan ports will add an additional 2 million to Global Ports' annual passenger base, with these developments continuing to enhance earnings quality through scale. Further, with Nassau now complete, analysts argued that the firm is "well positioned to fund further new concessions, predominantly through ring-fenced project finance".
Going forward, Global Ports was optimistic about its prospects over next year's season, thanks predominantly to a strong recovery for the global cruise industry following the Covid-19 pandemic.
"Our consolidated and management ports are expected to welcome close to 14 million passengers in the 12 months to 31 March 2025, with passenger volumes rising to exceed 16 million once San Juan Cruise Port and St Lucia Cruise Port join the network," Kutman added. "This will take our annual total passenger volume across all ports...to close to 20 million."
Shore Capital also set a promising outlook for the year ahead.
For financial 2025, analysts expect Ebitda of USD109 million, building to USD117 million in financial 2026. They explained the predication was based on broadly flat passenger numbers, modest yield growth, and flat underlying margins.
"With management guiding to around 14 million passengers next year, and assuming flat revenue yields (port mix) and no change to margin assumptions, we see around a USD5-10 million upside risk to our FY25F EBITDA estimate. We would see our assumptions as conservatively set, especially given the current momentum and make no allowance for gaining future concessions," said Shore Capital.
Shares in Global Ports closed flat at 255.00 pence each on Tuesday in London.
By Holly Beveridge, Alliance News reporter
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