Mersey Docks remains cautious on 2002

Mersey Docks, the Liverpool ports operator, reported a small increase in profits blaming tough market conditions. The company, which issued a profits warning in December and made 40 staff redundant, said the group had performed “satisfactorily” in a year which saw “progressive deterioration in global conditions”. In the 12 months to December 31, Britain’s second largest port operator reported an increase in pre-tax profits of 4.9 per cent to £55.6m ($79.1m) against £53m in 2000, while turnover rose by 14 per cent to £262m. The sale of the group’s Port of Liverpool building produced exceptional profit of £4.2m. Earnings per share rose 6.2 per cent to 46.8p, with a final dividend of 14p up 7.9 per cent.
Gordon Waddell, chairman, said the outlook on international trade remained cautious, but said some commentators pointed to a recovery in the final quarter. “Our continuing focus on cost reduction combined with increased efforts to attract new business should allow further progress to be made this year,” he said.
Peter Jones, chief executive officer, said investment in container operations equipment in the Liverpool port had produced considerable productivity improvements and the company’s labour contractor had reduced staff by 10 per cent as a result. He said there were various other cost reduction plans in place including a programme with PowerGen to reduce environmental levies. “Our operations are under continuous review. There are no plans for further redundancies, but it’s not out of the question,” he said. “We’re fairly cautious, but confident that there will be progress. There’s going to be a recovery, but I wouldn’t want to put my money on when it will happen.”
The group said that in its port operations division, several cargo areas including general cargo, forest and liquid cargo experienced a drop in volume from 2000. Operations in Liverpool also suffered from adverse weather conditions in the second half of the year and reported a 3 per cent drop in volume, which it said was the result of weaker Irish sea shipments and a sharp fall in North Atlantic trade in the final quarter.
The group’s shipping division, which consists of three lines – Coastal Container, BG Freight and Concorde Container – all faced “highly competitive” market conditions, but were trading profitably after the closure of Coastal Container’s Dublin terminal.
Meanwhile Mersey Docks’ recently acquired transport division, formerly operated by the Imari group, reported a modest full-year profit of £1.6m following its purchase in July 2000. The group said, however, that its tank transport business had a particularly tough year due to an “erratic” and over-supplied market.
In early trade shares in Mersey Docks were trading down 2.41 per cent at 485p.