Another quarter with an outstanding set of results in cruise ports operations with impressive growth in passenger numbers, cruise revenues and cruise EBITDA (adj.for €/$ parity effect)…
Pleasing performance on the commercial ports front with continuing growth in TEU throughput at Port Akdeniz in Q4 2015, strengthening the expectation for awaited recovery and stabilization…
Q4 2015 registers itself as a period with an outstanding financial and operational performance in cruise ports operations; and a pleasing quarter on the commercial ports front with continuing growth in TEU throughput at Port Akdeniz, which started in Q3 2015 after five consecutive quarters of decline. Cruise revenues and cruise EBITDA imply a 4.4% and 6.1% increases, consecutively, in Q4 2015 compared to Q4 2014, when adjusted for €/$ parity effect. On FY 2015 basis, cruise revenues posted c.10% increase (adjusted for the €/$ parity effect), and cruise EBITDA grew by a solid 18% (adjusted for the €/$ parity effect).
GPH reports consolidated revenues of US$105.5mn, and a consolidated EBITDA of US$71.2mn in FY 2015; which translated into 68% consolidated EBITDA margin, indicating 420bps increase YoY. Consolidated EBITDA registered 2% increase; while consolidated revenues indicate c. 5% decline in FY 2015 YoY in US$ terms, yet, when adjusted for the €/$ parity effect, consolidated revenues indicate a 1.2% increase.
GPH continued to expand its passenger base in Q4 2015 considerably, driven by both organic and inorganic growth, despite Q4 being partially a low season period. Even when Valletta Cruise Port acquisition (November 2015) effect is excluded, total passengers posted a remarkable 10% YoY incresase in FY 2015 driven by Creuers, Bodrum, Ege Ports, and Lisbon cruise ports along with tariff increases; while also registering strong margin increases in FY 2015 YoY in all of the cruise ports in the portfolio. The solid 10% YoY organic growth in passenger base well surpasses the global cruise passenger growth rate of 3.2% YoY as well as Mediterranean cruise passenger growth of c.6% in 2015. Nevertheless, when the full year effect of Valletta Cruise Port acquisition, which took place in Q4 2015 is included, total passengers indicate a striking 28% YoY growth in FY 2015.
A c.15% tariff increase has been in place in Lisbon effective 1st July 2015, demonstrating GPH’s commitment to its strategy to adopt rational and optimal pricing at the ports it acquires.
Revenues came out at US$105.4mn in FY 2015, as opposed to US$110.7mn in FY 2014 on a pro-forma basis (pro-forma for FY 2014 effect of Creuers acquisition), indicating a 4.7% decline. The 16% YoY decrease in Eur/US$ parity in FY 2015 compared to FY 2014 put a cap on revenue growth in US$ terms due to the Euro based ports in GPH’s portfolio (Creuers and Adria constitute 32% of revenues); yet, when adjusted for the parity effect (approximately US$1.7mn for Port of Adria, and US$4.9mn for Creuers) total revenues indicate a 1.2% increase, while cruise revenues indicate a strong c.10% increase in constant currencies for FY 2015 YoY.
On the EBITDA front, total segmental EBITDA (including operational companies only, excluding GPH solo expenses) posted 1% increase in FY 2015 compared to FY 2014 on a pro-forma basis. Yet, when adjusted for the parity effect, total segmental EBITDA reveal 6% increase, driven by the solid 18% growth in cruise ports’ EBITDA.
As for leverage, net debt stood at US$253mn as of 2015 YE on a pro-forma basis (2014 pro-forma for Creuers acquisitions and its finacing; 2015 pro-forma for Malta acquisition and its financing); Net Debt / EBITDA declined to 3.3x at 2015 YE from 3.9x at 2014 YE. Additionally, bond leverage covenant stood at 4.3x as of 2015 YE, comfortably below the 5.0x threshold.
Cruise Ports Operations:
GPH registered a significant 10% YoY expansion in its cruise passenger base in 9M 2015 on the back of Creuers, Bodrum, Ege Ports, and Lisbon cruise ports along with tariff increases; consequently registering EBITDA and margin increases in FY 2015 YoY in all of the cruise ports in the portfolio. Cruise EBITDA margin registered 510bps increase YoY, reaching 72.4%.
Creuers’ (including Malaga) revenues increased by 15% in FY 2015 YoY in Eur terms, reaching Eur22.3mn, while EBITDA surged by 25% YoY, reaching Eur 14.9mn in FY 2015, and translating into a 67% EBITDA margin in FY 2015, which indicates a 500bps increase YoY. Nevertheless, due to the 16% YoY decrease in Eur/US$ parity in FY 2015, Creuers’ revenues indicate a 4% decline, and EBITDA indicates a 4% increase in US$ terms.
Ege Port, major cruise port of GPH in Turkey posted US$17.3mn revenues, implying a 6% increase YoY in FY 2015; US$14.2mn EBITDA in FY 2015, indicating a solid 11% YoY increase, and translating into a striking 82% EBITDA margin (as opposed to 78% in FY 2014).
Commercial Ports Operations:
On the commercial front, TEU throughput of Port Akdeniz, which started a positive growth in Q3 2015 after five consecutive quarters of decline due to the stress on marble exports to China, continued to grow in Q4 2015 with an increasing pace at 1.4% YoY, strengthening the expectation for the awaited recovery and stabilization in TEU volumes
The decline in TEU throughput has been driven by the recession in Chinese construction sector and accumulated marble stocks in China; yet, Port Akdeniz has been more resilient to the stress in China compared to Turkey. To illustrate: Turkey’s marble exports to China decreased by 13% in FY 2015, while Port Akdeniz’s marble exports to China declined with a slower pace at 8% in in the same period YoY, leading to 7% decline in TEU throughput at port Akdeniz in FY 2015. (Source: Turkish Statistical Institute)
Container yield increased by 6% in FY 2015 YoY, reaching US$191, continuing to compensate for the sluggish volume to a large extent at Port Akdeniz; accordingly EBITDA margin increased by 300bps, reaching 75% in FY 2015.
Meanwhile, share of imports in full container volume increased from 17% in FY 2014 to 22% in FY 2015, while share of exports declined from 83% to 78% during the same period. Imports are driven by PVC and furniture imports (Antalya is the sole seaport for custom clearance for furniture since November 2014). Moreover, imports (full TEU) posted 26% increase YoY increase in FY 2015.
Port of Bar: Thanks to the 17% volume growth in FY 2015 YoY, total revenues registered 10% YoY increase in Eur terms in FY 2015, reaching Eur7.7mn; while EBITDA registered 3% YoY growth in FY 2015. Again, due to the 16% YoY decrease in Eur/US$ parity in FY 2015, Port of Adria’s’ revenues indicate an 8% decline, while EBITDA indicate an 14% decline in US$ terms.
Container yields came out at US$96/TEU in FY 2015, 49% lower compared to those of Port Akdeniz (US$191/TEU), bringing the weighted average yield to US$174/TEU. The 23% YoY decline in container yield in US$ terms in FY 2015 is mainly attributable to the 16% decrease in Eur/US$ parity in the same period; the decline in Euro terms is 8%.
All in all, commercial EBITDA margin, despite the sluggish volume at Port Akdeniz, was up by 270bps, reaching 67.9% in FY 2015.
- EBRD became a partner of GPH in November 2015, by acquiring post money, primary 10.84% stake in GPH at a consideration of €53.4mn, valuing 100% of the company at €493mn equity value.
- Main shareholder GIH diluted from 100% to 89.16%.
- US$60mn cash injection into GPH
- GPH’s share capital increased from T