Trading statement of twelve months to 31 March 2022
Global Ports Holding PLC (GPH)
Global Ports Holding Plc Trading Statement for the twelve months to 31 March 2022 Global Ports Holding Plc (“GPH” or “Group”), the world’s largest independent cruise port operator, today issues a trading update with its unaudited preliminary financials for the period from 1 April 2021 to 31 March 2022.
Key Highlights
Cruise
Commercial
Balance Sheet At 31 March 2022, IFRS gross debt was $597.7m (Ex IFRS-16 Finance Leases Gross Debt: $534.9m), compared to gross debt at 31 March 2021 of $548.9m (Ex IFRS-16 Finance Leases Gross Debt: $483.0m). Net debt Ex IFRS-16 finance leases was $435.2m compared to $312.4m as at 31 March 2021. At 31 March 2022, GPH had cash and cash equivalents of $99.7m, compared to $170.6m at 31 March 2021. The net debt increase of $122.8m in the period was primarily driven by (i) capital expenditure of $95.8m, with $91.2m of this spent on our continued investment into the transformation of Nassau Cruise Port, (ii) the net effect of the Eurobond refinancing, in particular, the use of the high level of available cash as of 31 March 2021 as a result of the sale of Port Akdeniz in January 2021 in such Eurobond refinancing, and (iii) additional indebtedness at Nassau Cruise Port to finance the investment commitment there. During the period, GPH entered into a five-year, senior secured loan agreement for up to $261.3m with Sixth Street, a leading global investment firm. The loan agreement provides for two term loan facilities, an initial five-year term facility of $186.3m and an additional five-year growth facility of up to $75.0m. The latter will be key to the continued success of our growth strategy. The first enabled the early repayment in July 2021 of the $250m 8.125% senior secured Eurobond due November 2021 (together with proceeds from the sale of Port Akdeniz). Other developments Despite the significant impact of Covid-19 on the cruise industry and our cruise operations, we have continued to deliver on our strategic growth ambitions. In the fourth quarter, we were awarded a 12-year concession, with a 6-year extension option, to manage the services for cruise passengers at Tarragona Cruise Port, Spain. This agreement follows the recent addition of GPH’s first cruise port in Northern Europe, with Kalundborg Cruise Port, Denmark joining the PGH network under a 20-year agreement and signing a 20-year concession agreement at Taranto Cruise Port, Italy, as well as being awarded preferred bidder status to Global Ports Canary Islands S.L., an 80:20 joint venture between GPH and our local partner Sepcan S.L., to operate three cruise port concessions in the Canary Islands. After the year-end, GPH announced that Emre Sayin, Chief Executive Officer, is stepping down from his role to pursue new business opportunities. Emre is expected to leave Global Ports Holding by the 26th May 2022. Mehmet Kutman, Co-Founder and Executive Chairman of GPH, will take on the Chief Executive Officer role as the business continues its path of recovery from the Covid-19 pandemic. Outlook Long term, the outlook for the cruise industry continues to be positive. The passenger capacity of the industry is forecasted to grow by 45% by 2027, from 2019 levels. Driven by the 75 cruise ships currently in the cruise ship order book and due for delivery by 2027. This growth in the number of ships and the size of ships means that many cruise ports will need to invest in their infrastructure in order to be able to accommodate the new ships. There is no better example of this type of investment than GPH’s significant investments into Antigua Cruise Port and Nassau Cruise Port. Despite the impact of the Covid-19 pandemic on GPH and the cruise industry, our investment to increase the capacity of these ports and transform the passenger experience has largely continued as planned over the last two years. Since taking over these two ports just before the pandemic in late 2019, GPH has invested over $200m in CAPEX; this demonstrates the commitment of GPH and our partners to our ports and destinations. Our strategic ambition to grow the number of cruise ports in the network remains a key focus for the board and management. Despite the unprecedented nature of the Covid-19 crisis and its significant impact on our business, we have continued to grow the number of cruise ports in our network. Since the onset of the crisis, we have announced agreements to add eight new cruise ports to the portfolio, a significant achievement in any period. This success stands as a testament to the strength of our operational capabilities and the appeal of our global expertise and operating model to a fragmented global growth industry. In the near term, since the end of the first quarter of the financial year, there has been a strong month-on-month acceleration in cruise calls and passenger volumes across our network. This acceleration primarily reflects the continued easing of travel restrictions, the continued strong underlying demand from consumers to return to cruising and the continued increase in fleet deployment from the major cruise lines to match the easing of restrictions and consumer demand. Activity levels are expected to continue to rise across the cruise industry, with 100% fleet re-deployment by the cruise lines expected during the summer of 2022. This continued positive momentum can be seen in our cruise calls for the three months to March 2022. On a like-for-like basis, calls were just three calls lower than in the same period in 2019, with Antigua and Nassau Cruise Port both welcoming more ships in March 2022 than in March 2019. Concerns around the Omicron variant negatively impacted occupancy levels. However, this impact has proven temporary, with occupancy levels rising strongly throughout the three months to the end of March 2022. In its recent quarterly results statement, Royal Caribbean declared that occupancy levels for the three months to March 2022 were 59%, with a load factor for March of 68%. With booking volumes for March and April significantly higher than in the same period in 2019, Royal Caribbean now expect occupancy levels to exceed 100% by the end of the calendar year. With cruise calls set to rise, occupancy levels will be key to our financial performance in the year to March 2023 and recent trends and industry expectations in this regard are very supportive.
Notes
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ISIN: | GB00BD2ZT390 |
Category Code: | TST |
TIDM: | GPH |
LEI Code: | 213800BMNG6351VR5X06 |
Sequence No.: | 160806 |
EQS News ID: | 1348955 |
End of Announcement | EQS News Service |
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