Mersey Docks: Trading Update

RNS Number:2421T Mersey Docks & Harbour Co 15 December 2003
15th December, 2003
THE MERSEY DOCKS AND HARBOUR COMPANY
Trading Update
This trading statement is made in advance of the end of the financial year on 31st December, 2003. The preliminary statement of results for 2003 is expected to be made on Tuesday, 16th March, 2004. At the time of the interim statement in September, 2003, the Board's belief was that the full year outcome would be similar to that of 2002. With the benefit of the results to date, the Board remains confident of that position. Port Operations Division At the Port of Liverpool, container volumes are expected to be well ahead of last year particularly reflecting increased Mediterranean volumes. In the agribulks sector overall throughput will be similar to last year. As reported at the half year Irish Sea ro/ro volumes are down on 2002, but the shortfall has been counterbalanced by the positive revenue impact of the Twelve Quays river terminal. At Medway, steel exports will boost general cargo volumes to record levels and Forest Products will also be marginally up on last year. Fresh produce imports and car imports will show a small decline from 2002. The number of containers handled at Marine Terminals in Dublin has continued to show the strong growth evident at the half year. Heysham will show a satisfactory financial performance in the light of reduced ro/ro volumes. In overall terms the Port Operations Division will match last year's operating profit. Shipping Division The Shipping Division has made progress in a highly competitive market. An encouraging increase in volumes will produce improved results at BG Freightline and Concorde Container Line, with Coastal Container Line improving on its first half performance. Overall, some improvement in the Division's operating profit is expected. Logistics and Road Transport Division The main Roadferry business has made further progress in building up its volumes to take full advantage of the increased capacity available. The tank transport businesses continue to suffer from the market conditions explained at the half year. The Division's operating profit for the year is expected to show a small shortfall on last year. Property Division The Property Division will show results commensurate with those for the first half. At Princes Dock, the developments outlined in the interim statement continue to progress. Further lettings at the new office building have recently been announced and some 30% of the space is now accounted for. Plans for a larger (735 space rather than 575) multi-storey car park are well advanced. The increase in size is in response to the existing and proposed developments and will make more efficient use of the land. Plans for the first residential development at Princes Dock have been submitted to the planning authority by the developer, City Loft Developments. Work continues on revising the Master Plan for the development of the Central Docks site. Summary Overall, trading is in line with expectations. Group operating profit is expected to be somewhat ahead of last year and the increase will enable the Group to deliver a pre tax profit very similar to 2002, notwithstanding a #2 million increase in interest, which principally reflects the cost of the share buy back programme. A further 4,285,000 shares have been bought in for cancellation since the half year making 7,595,000 for the full year, at a cost of #41.3million. Capital expenditure for the year, including leasing of #3.9million, will be approximately #24 million. Cash generation remains strong, and debt at the year-end is expected to be approximately #245 million. Outlook The second half of 2003 has seen tentative signs of improvement in economic conditions and these are reflected in our outlook for 2004. In our Port Operations division, container volumes in Liverpool and Dublin should show continuing growth and we expect some recovery in our ro/ro sector as the near-term uncertainty in the Irish Sea is resolved. The agribulks and fresh produce sectors are expected to be modestly positive, but the outlook for cars is less favourable. Medway should receive a further boost from growing steel exports. The Shipping and Transport divisions also expect to advance in the coming year, and the Property division is likely to benefit from further lettings and some disposal proceeds at Princes Dock. The Board is confident of overall progress and that the recent capital investment programme has provided the capacity to enable the Group to take advantage of the expected upturn. END Enquiries: Mersey Docks Peter Jones or Alastair Findlay 0151 949 6240 Smithfield Anna Rainbow 020 7360 4900 This information is provided by RNS The company news service from the London Stock Exchange END