par Atlantic Lithium Limited (isin : GB00BD2ZT390)
Trading statement for the twelve months ended 31 March 2023
Global Ports Holding PLC (GPH) Global Ports Holding Plc Trading statement for the twelve months ended 31 March 2023 Global Ports Holding Plc (“GPH” or “Group”), the world’s largest independent cruise port operator, today issues a trading update for the period from 1 April 2022 to 31 March 2023.
Notes
Key Highlights
Balance Sheet At 31 March 2023 IFRS Gross Debt was USD 676.0 million (Ex IFRS-16 Leases Gross Debt: USD 615.9 million), compared to Gross Debt at 31 March 2022 of USD 598.6 million (Ex IFRS-16 Leases Gross Debt: USD 534.7 million). The main drivers for the increase in Gross Debt were the partial drawdown of the growth facility under the Sixth Street loan (USD 38.5 million) to finance the Ege Port concession extension, additional loans and bonds to finance the expected CAPEX for recent European acquisitions (Malta bond, and bank loans at Tarragona Cruise Port and Canary Island Cruise Ports, combined USD 25.4 million), in addition to accrued (PIK) interest under the Sixth Street loan partially offset by scheduled loan amortizations. Net debt Ex IFRS-16 Leases was USD 497.5 million at the end of the Reporting Period compared to USD 435.0 million as at 31 March 2022. At 31 March 2023, GPH had cash and cash equivalents of USD 118.4 million, compared to USD 99.7 million at 31 March 2022. The additional Gross Debt incurred described above had no material impact to Net Debt as the funds remained on balance sheet as cash as at 31.03.2023 and have been invested shortly after the end of the Reporting Period (Ege Extension) or will be invested (debt raised for European expansion). The main driver of the decrease in cash during the Reporting Period was Net Capital expenditure of USD 107.1 million, the majority of which was for the ongoing investment into Nassau Cruise Port, partially offset by operating cash flows of approximately USD 60 million, reflecting the growth in Adjusted EBITDA. Nassau Cruise Port Re-financing Shortly after the end of the Reporting Period, Nassau Cruise Port successfully refinanced its local bond issued in June 2020. The refinancing resulted in an increase in the nominal outstanding amount to USD 145 million (from USD 134.4 million) and a reduction in the fixed coupon to 6.0% (from 8.0%), reducing the annual interest payment by USD 2.0 million. The maturity date of 2040 remains unchanged as does the principle repayment schedule which is ten equal annual payments from June 2031. The bond remains non-recourse to GPH or any other Group entity. Ege Port, Kusadasi Concession Extension Shortly after the end of the Reporting Period GPH was reached an agreement to extend its concession agreement for Ege Port, Kusadasi. The original concession agreement was due to expire in July 2033, and following this extension agreement, the concession will now expire in July 2052. In exchange for the extension of the existing concession agreement, Ege Port has paid an upfront concession fee of TRY 725.4 million (USD 38 million). In addition, Ege Port has committed to invest up to a further 10% of the upfront concession fee within the next 5 years into improving and enhancing the cruise port and retail facilities at the port, and will pay a variable concession fee equal to 5% of its gross revenues during the extension period starting after July 2033. The up-front concession fee payment has been financed by partial utilisation, shortly before the end of the Reporting Period, of the USD 75 million growth facility provided by Sixth Street, previously announced on 24 May 2021 and approved by shareholders on 9 June 2021. As part of the additional draw down with Sixth Street, GPH has issued further warrants to Sixth Street representing additional 2.0% of GPH’s fully diluted share capital (in addition to warrants issued at financial closing in July 2021 equivalent of 9.0% of GPH’s fully diluted share capital). The upfront concession fee has been funded by a capital increase at Ege Port. This capital increase was provided by GPH only, as a result, GPH’s equity stake in Ege Port has increased to 90.5% (from 72.5%). Malta bond issuance Shortly before the end of the Reporting Period, GPH, through a 100% owned SPV in Malta, issued EUR 18.1 million of unsecured bonds due 2030 at the rate of 6.25% per annum. These bonds are guaranteed by GPH, and the proceeds will be used to partially finance GPH’s investment plans for recent cruise port acquisitions in Europe. Subordinated shareholder loans Furthermore, GPH has received additional, long-term funding support from its largest shareholder Global Investment Holding in the form of additional subordinated shareholder loans to finance project expenses for expansion projects, debt service and general corporate purposes. As of the end of the Reporting Period, the total amount of subordinated shareholders loans received from GIH increased to approximately USD 25 million. Operational Review Given the strong performance of the Group and the continued growth in the number of ports in the network, it was decided during the Reporting Period to restructure the group’s financial reporting. GPH will now report by geographic segment, which matches our organisational structure better. Americas GPH's operational performance in the Americas in the Reporting Period includes GPH's two Caribbean ports, Antigua Cruise Port and Nassau Cruise Port. Prince Rupert, Canada, which was added to the network during the Reporting Period, did not welcome its first cruise call until after the end of the Reporting Period. Trading in the Americas region improved strongly, with passenger volumes of 4.4 million for the Reporting Period compared to just 1.5 million in the prior Reporting Period. Nassau Cruise Port benefitted from its proximity to the key home ports in Florida and the cruise lines' near-term desire to operate a higher volume than normal of short cruises in this area at the expense of longer itineraries to other parts of the Caribbean. This decision helped Nassau Cruise Port report a 196% increase in cruise passengers to 3.8 million. Nassau Cruise Port, on some days, is now hosting six cruise ships simultaneously, utilising the new berthing that was created as part of our significant investment into the port. On the 27th of February 2023, the port welcomed a record 28,554 passengers in a single day. Our investment in the transformation of Nassau Cruise Port continued throughout the Reporting Period. Our vision for this iconic port is becoming a reality, and we believe this port will stand as a testament globally to our cruise port and destination development capabilities. Due to the major US cruise lines focussing on short cruises close to the Southern US home ports throughout the Winter 2022/23 cruise season, the recovery rate in passenger volumes at Southern Caribbean cruise ports was less strong. For GPH, this meant Antigua Cruise Port's cruise operations recovered at a slower pace than that experienced by Nassau Cruise Port. Cruise passenger volumes at Antigua Cruise Port of 556k in the Reporting Period were up 135% from the 237k during the prior Reporting Period. Our Americas operations achieved a milestone in the last year with the signing of our first cruise port concession in North America. Signing a 10-year concession, with a 10-year extension option, for Prince Rupert Cruise Port in British Columbia, Canada, is an important step in our continued growth. Prince Rupert Cruise Port is located at the heart of the British Columbian cruise market, just 40 miles from Alaska, one of the largest cruise markets in the world, and ideally placed for cruise itineraries to and from the key homeports in the region: Seattle and Vancouver. Prince Rupert Cruise Port is expected to welcome nearly 80,000 passengers over the 2023 Alaskan summer cruise season. The port has the infrastructure and capability to handle larger ships, and GPH expects to drive a significant increase in passenger volumes in the years ahead. In August 2022, GPH signed a 30-year concession agreement for San Juan Cruise Port, Puerto Rico. In October 2022, a Memorandum of Understanding was signed for a 30-year concession, with a 10-year extension option, for the cruise port of St Lucia. We expect to welcome these ports into our network during the fiscal year 2024 Reporting Period. West Med & Atlantic GPH's operational performance for the West Med & Atlantic region includes our Spanish ports Barcelona, Fuerteventura, Lanzarote, Las Palmas, Malaga, Tarragona and Vigo, as well as Kalundborg, Denmark, and the equity pick-up contribution from Lisbon and Singapore. Alicante Cruise Port will start to contribute in the 2024 Reporting Period. Overall passenger volumes were 2.9 million, an increase of 450% compared to the comparable Reporting Period. This strong performance was despite the fact that, at the start of the Reporting Period, the recovery in passenger volumes in this region was negatively impacted by the uncertainty around the omicron variant during the important 2022 booking season and the lower onboard capacity limits set by the cruise lines as they ramped up operations. The easing of travel restrictions as the Reporting Period progressed led to increased cruise activity across our West Med & Atlantic region. Call volumes, particularly at Barcelona, the largest port in the Mediterranean, were strong and by the end of 2022 season close to 2019 levels. However, occupancy rates, which rose steadily throughout the Reporting Period, remained below industry norms. The major cruise lines expect occupancy to reach 100%+ ahead of the summer season 2023. Barcelona Cruise Port welcomed Valiant Lady for its inaugural season, and we provided our new Integrated Services Package to the ship throughout the season. Kalundborg Cruise Port, Denmark, marked a milestone during the Reporting Period when it welcomed AIDAnova, the largest ship to ever call at the port. The West Med & Atlantic network grew its cruise port footprint further during the Reporting Period. At the beginning of the Reporting Period, Tarragona Cruise Port joined the network after we signed a 12-year concession with a 6-year extension option. This port recently underwent a EUR 30 million investment into the port infrastructure by the port authority, including a new cruise pier and the provision of shore power. Under the terms of the concession agreement, GPH will invest into building a new state-of-the-art modular cruise terminal expected to cost around EUR 5.5 million, which will utilise solar power to ensure the sustainable provision of the terminal's energy needs. We added three new ports to the network when GPH's 80:20 joint venture with a local partner signed concession agreements for three ports in the Canary Islands: Las Palmas Cruise Port (40 years), Lanzarote Cruise Port (20 years) and Fuerteventura Cruise Port (20 years). As part of the agreements, the joint venture will invest approximately EUR 40 million into constructing a new cruise terminal in Las Palmas and modular terminal facilities in Lanzarote and Fuerteventura. These three cruise ports handled 1.5 million cruise passenger movements in 2019, compared to 0.8 million passengers handled since the takeover late in 2022, a period which was characterized by the recovery towards pre-pandemic levels, ramp-up phase by GPH and only partially covered the main winter season. Shortly before the end of Reporting Period, we added Alicante Cruise Port, Spain, when we a 15-year cruise port concession with the same partner and the same joint venture structure as in the Canary Island. Central Med Our Central Med region includes Valletta Cruise Port, Malta, GPH's four Italian ports (Cagliari, Catania, Crotone and Taranto) and the equity pick-up contribution from La Goulette, Tunisia and Venice Cruise Port, Italy. Trading in this region was similar to that experienced in the West Med & Atlantic region, with cruise calls rising strongly compared to the prior Reporting Period but with lower than-normal occupancy levels. Although, like with the West Med, occupancy levels rose as the Reporting Period progressed. The Central Med region, driven by Valletta Cruise Port, GPH's largest port in this region, welcomed 1.0 million passengers in the Reporting Period, a significant increase from the 328k passengers welcomed in the comparable period but 26% lower than the 1.4m welcomed in the 12 months to March 2020. The work to complete the EUR 49.9 million Grand Harbour clean air project in Valletta is progressing well. Infrastructure Malta and Transport Malta are funding this project, which includes a EUR 37 million investment to provide shore power to five cruise ship quays and is expected to complete shortly. We were delighted when Valletta Cruise Port was awarded "World's Best Cruise Terminal for Sustainability" by the World Cruise Awards. Elsewhere, we extended the concession at Cagliari, at no cost, by two years and Taranto Cruise Port was awarded Destination of the Year at the Seatrade Cruise Awards. We were delighted when La Goulette Cruise Port, welcomed the return of cruise passengers during the Reporting Period. After a seven-year break, this was an important moment for La Goulette Cruise Port, the country of Tunisia and all of our local stakeholders. East Med & Adriatic GPH's East Med & Adriatic operations include the flagship Turkish port Ege Port in Kusadasi, as well as Bodrum Cruise Port, Turkiye and Zadar Cruise Port, Croatia. In this region, the impact on passenger volumes of lower than-normal occupancy levels was outshone by the significant increase in cruise calls compared to the comparable Report Period. Passenger numbers in the East Med & Adriatic region were 905k, a significant increase from the 21k welcomed last fiscal year and the 351k in the 12 months to March 2020. This strong recovery in passenger volumes was driven by the performance of our Turkish ports. In 2017, our Turkish ports suffered a sharp drop in passenger numbers due to geo-political issues. In early calendar year 2020, bookings from the cruise lines indicated that Ege Port would report a strong recovery in passenger volume numbers. Unfortunately, the onset of the Covid-19 pandemic meant this expected recovery did not materialise. Despite the lower-than-normal occupancy levels across the industry in the Reporting Period, the pent-up demand to return to cruising to Turkish ports drove the strong performance in the East Med & Adriatic region. During the Reporting Period, Ege Port, Kusadasi welcomed Odyssey of the Seas, the largest ever cruise ship to call at a Turkish port. Zadar hosted a record four ships simultaneously. These achievements further underpin the expected growth across the industry in terms of the number of cruise ships in the global cruise fleet and the size of those ships. On the 6th of February 2023, an earthquake in east of Turkiye caused significant damage to buildings and infrastructure and caused a humanitarian crisis. The earthquake had no impact to our Turkish cruise ports or the communities they are located in, but we opened our cruise ports in Turkiye to help support the relief efforts. The ports were utilised as logistics centers and provided temporary accommodation for some of the victims. In all of our destinations, we set up an earthquake relief campaign in collaboration with local and international NGOs at our ports. Other Our Other reporting segment includes our commercial port Port of Adria, Montenegro, our management agreement for Ha Long Cruise Port, Vietnam and the contribution from our new Port Services Businesses. Our Port Services are services aimed at enhancing cruise passengers' overall experience in the port and destination. Our services include Destination and Shoreside Services such as Guest Information Centers and Transportation services, crew services, Area & Terminal management services such as Retail and Duty-Free shops and food and beverage outlets and Crew Services such as catering and transportation services for crew and crew lounges. We are focused on growing our Port Services at GPH-operated cruise ports and ports operated by third parties. During the Reporting Period, we provided a range of Port Services to Virgin Voyages' ships at Spanish ports. At Barcelona, we provided and managed an encompassing range of services directly or via third parties, including stevedoring, port agency and crew services. We also provide services at our ports in Málaga and Lisbon and an additional four non-GPH Spanish ports. This agreement is an exciting development and an important first step in our ambitions to grow our Port Services revenues. As a result of the change to our financial reporting, we no longer report Port of Adria’s performance separately, reflecting our strategic focus on cruise operations and the fact Port of Adria’s EBITDA contribution to the Group is small. Trading at Port of Adria was stable during the Reporting Period with single-digit growth in EBITDA. The Board of Global Ports Holding continues to consider its options regarding Port of Adria, including its potential sale. Outlook The scheduled launch of new cruise ships in the year ahead means the number of available berths across the global cruise fleet will reach all-time highs in 2024, and when combined with industry occupancy rates reaching pre-Covid-19 levels, the industry will be propelled to exciting new highs. Industry booking patterns have been rebuilt to market norms over the last 12 months, and all major cruise lines have reported record booking trends for 2023. Looking further into the future, long-established demand and supply trends in the cruise industry have re-established themselves as key drivers of cruise industry growth. According to Cruise Industry News, by the end of 2027, passenger capacity in the cruise industry is forecast to grow to over 40 million, a growth rate of 45% from pre-covid levels. The medium to long-term demand trends have been largely unaffected by Covid-19. The growing appetite for leisure travel, if anything, has perhaps been increased by Covid-19. The introduction of so many new classes of cruise ships in such a short time reflects the industry's drive to continue attracting new customers. Before Covid,-19, it was a requirement for many cruise ports to invest significantly in their infrastructure to meet the needs of the growing number of cruise ships and the growing size of cruise ships as well as the increased demand from passengers for an improved cruise port experience. Those requirements have re-emerged e |