Dublin Port Company today published its 2008 Annual Results and trading figures for the first half of 2009 which show that Dublin Port Company continues to perform strongly despite the downturn with sustained profitability and increased dividend payment to its shareholder on the back of rigorous management of its cost base. The company remains committed and well placed to continue its capital investment programme to ensure that Ireland’s premier port is prepared to deal with renewed growth in the economy.
Highlights:
2008
January – June 2009
Despite a more challenging economic environment, trade at Europe’s seventh largest RoRo port, Dublin Port, was less than 5% off its historic throughput high of 30 million tonnes in 2007 and the out turn was in line with guidance given at the half year trading update last year. A key factor in lower trade volumes was a reduction in the unitised trade sectors Roll-on-Roll-off and Lift-on-Lift-off (RoRo and LoLo) which accounts for 80% of throughput. In 2008, RoRo and LoLo throughput fell by 4% and 9% respectively. Dublin Port continues to be Ireland’s port of choice and has grown market share again driven by its low cost model, choice of eight competing terminals and the benefits of its location at the heart of Ireland’s largest market.
Operating profit increased by 25% in 2007 to €26.7 million despite turnover remaining broadly in line with the previous year. The company continued its rigorous focus on reducing its cost base to ensure that is plays its role in helping to drive national competitiveness. This focus has ensured that vessel and goods dues to the unitised sector (80% of trade) remain 10% lower in nominal terms than twenty years ago. 2008 also saw the seventh consecutive year of payroll reduction with a 5.4% decrease which makes the wage bill 35% lower than it was in 2001. While there was a 1.4% increase in overall operating expenses to €42.5 million. When the 10% increase in City Rates and bi-annual dredging is excluded, non-pay costs were, in fact, 3% lower.
On the tourism side of the business, ferry passengers declined during the year, however even with the decline passenger numbers are still ahead of 2005 and 2006 levels. The cruise sector continued to grow with 83 cruises visiting in Dublin Port 2008.
As part of its ongoing commitment to ensure Dublin Port increases efficiencies at the port, the company invested €26.6m in infrastructural improvements including the construction of Ireland’s largest service station, which provides refuelling and associated facilities for port customers. The company remains committed to a capital investment programme with half a billion euro earmarked over the next ten years including our Dublin Gateway proposal to provide additional capacity for larger vessels. This proposal is currently in a planning process with An Bord Pleanala.
The company’s pension fund continues to meet the minimum funding standard, following significant investment in the fund since 1997 and the implementation of an appropriate funding strategy, matching assets to the liability profile of a very mature fund.
The first half of this year has seen a 15.7% fall in trade levels on the same period last year with a fall of 13% in turnover. The focus on efficiency continues with the 8th consecutive reduction in the company’s payroll and this together with other cost management measures has ensured that operating profit was less than 5% lower than the same period last year. However, notwithstanding the downturn Dublin Port is still handling four times the level of trade as it did fifteen years ago. We continued to invest in the port’s infrastructure with the first phase this year’s €20 million capital spend and the company also paid an interim dividend of €5.3 million to its shareholder last month.
The first half of 2009 saw an increase in ferry passenger numbers of 7.6%. This is a welcome boost for the economy as ferry passengers tend to stay longer, spend more and travel further into the country than airline passengers. Our commitment to the cruise sector has again delivered great results in securing Dublin’s first of three “turnaround” cruises this year. A turnaround cruise is one where a cruise starts in Dublin and generates even greater revenue for the city as passengers finishing on the cruise are likely to stay in Dublin longer than a port of call. Also, those joining the cruise in Dublin will stay in the city and spend in the local shops before embarking on their cruise.
Commenting at the launch of the 2008 Annual Report and 2009 H1 trading update, Mr. Enda Connellan, Chief Executive of Dublin Port Company, said: “I am pleased to report an exceptionally strong performance during the year which provided many challenges, not only for us, but the economy as a whole. Dublin Port Company’s operating profit grew by 25% on a similar turnover as the previous year. Our dividend to our shareholder increased by 22% and we were in a position to invest almost €27 million in port infrastructure.
Dublin Port Company has done a huge amount of work to help contribute to national competitiveness by introducing competition within the port and addressing our own cost base. Our pension funding position remains strong and continues to exceed the minimum funding standard prescribed by the 1990 Pensions Act. Even with trade volumes falling in 2009 with a resultant fall in revenue, Dublin Port Company remains profitable and will continue to pay a dividend to its shareholder.
As a company it is well placed to see through the current economic challenges and provide the necessary investment that will help drive the real trading economy when growth returns.”
Date Published: Tuesday 28. of July 2009