Strong First Quarter Reported by Port Authority

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The Port of Houston Authority is doing exceptionally well compared to the 2012 original budget, as a budget reforecast unveiled on April 24 shows increased revenue and net income projections for the year.

The Port of Houston Authority is doing exceptionally well compared to the 2012 original budget, as a budget reforecast unveiled on April 24 shows increased revenue and net income projections for the year.

Revenues for 2012 are expected to be $232.9 million, an increase of more than $10 million, or about 4.5 percent, versus the Port Commission-approved 2012 budget, noted Leonard D. Waterworth, who was later appointed Executive Director by the Port Commission at its regular April 24 meeting. Waterworth had been interim executive director since January 30, 2012.

While total tonnage at Port Authority facilities, excluding bulk cargo at leased locations, was down 20,000 tons or 0.7 percent for the month of March, Waterworth said, year-to-date tonnage has grown by 986,000 tons or 15 percent.

“This growth is sustained by continued strength in steel tonnage,” Waterworth said.

Steel is up 145,000 tons or 40 percent for the month, and 708,000 tons or 85 percent for 2012. In addition, general cargoes, including bagged goods and windpower equipment, grew substantially, by 355,000 tons or 45 percent for the year. Overall container tonnage declined slightly by 2 percent for the year, although loaded container units grew by 2 percent.

The impact of this positive news was significant – March operating revenues were $19.7 million, up by 3 percent over last year, with year-to-date revenues of $54.4 million – a 9 percent increase over 2011. Year-to-date net income was $10.1 million, a 228 percent increase versus prior year.

The 2012 reforecast also reflects a reduction of $5.4 million in total expenses versus the original budget, resulting in projected net income of $25.2 million and cash flow of $81.3 million for the year.

“This is a very positive report for the first quarter,” Waterworth concluded.

Among other matters, the Port Commission also authorized five-year lease and freight handling agreements with Coastal Cargo of Texas Inc., at the Port Authority’s Care Terminal.

ENGINEERING & REAL ESTATE
(Agenda H-7) The Port Commission approved entering into a five-year lease agreement with Coastal Cargo of Texas Inc. for about 22.13 acres at the Care Terminal at a rental rate of $54,558 per month with a 3 percent annual escalation. The area and rent would respectively increase by 8.63 acres at the then-applicable rental rate on or before January 1, 2014. The Commission also approved a freight-handling assignment agreement with a commitment to handle a guaranteed tonnage amount for a five-year term effective June 1, 2012. Commissioners also approved renewal of the current stevedore license for the duration of the term of the lease agreement and freight-handling assignment agreement, upon satisfaction of license requirements set forth in the latter agreement. Coastal Cargo currently uses the property for storage, staging, crating and packaging of cargo and as an office building, transit shed and truck parking area. Its current lease agreements both expire on May 31, 2012, and the stevedore license expires on Dec. 31, 2012. The Port Authority benefits from the arrangement by collecting rental payments and tariff revenue, including dockage, wharfage, demurrage and other tariff charges.

OPERATIONS
(Agenda K-3 & K-4) The Port Commission approved entering into Marine Terminal Services agreements with Cosco Container Lines Americas Inc. and Hanjin Shipping America LLC, in connection with the recently announced service to Houston. The Port Authority enters into these agreements with its major container carriers, to permit it to properly plan its capital investments and prudently commit and spend public funds. The agreements require carriers to commit for a specific term for their cargoes to move through the region at the Port Authority’s container terminals, while providing volume incentives for using its facilities in connection with such agreements.

CONTACT:    
Bill Hensel, Manager, Corporate Communications
Office: (713) 670-2893, Cell: (832) 452-5776, E-mail: bhensel(at)poha(dot)com

Lisa Ashley, Director, Corporate Communications
Office: (713) 670-2644, Cell: (832) 247-8179, Email: lashley(at)poha(dot)com

About the Port of Houston Authority
The Port of Houston Authority facilitates commerce, navigation and safe waterways promoting sustainable trade and generating economic development for the Houston region, Texas and the nation, while being a model environmental and security steward, and a community-focused and fiscally responsible organization.
For more information, please visit http://www.portofhouston.com.

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Maggi Stewart
Port of Houston Authority
713 670 2834
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