Kingston Wharves unfazed by COVID - To invest in tech, security
Chairman of Kingston Wharves Limited, KWL, Jeffrey Hall says the port company’s capital base and liquidity are strong, and is confident they can sustain all core operations for the likely duration of the worst effects of the COVID-19 pandemic.
At the onset of the crisis, which has been affecting Jamaica since March, Kingston Wharves activated its business continuity plan to facilitate the ongoing effective functioning of the port terminal and logistics centres as critical channels for the movement of essential cargo, including food and medical supplies.
“We have supported the plan with the rollout of technology to facilitate digital transactions by customers and to allow many of our team members to work remotely or on flexi-time,” Hall told KWL shareholders at their annual general meeting, held at Newport West in Kingston on Thursday. The meeting was also streamed live for persons who were unable to be physically present.
Kingston Wharves CEO Mark Williams also reported that the port company, in operation for 75 years, would be accelerating a programme to digitalise the services.
“The world, even post COVID, has seen an area where focus is on technology and we want to be at the forefront of that,” said Williams, who succeeded Grantley Stephenson in January.
“We continue to roll out several e-payment platforms for our customers,” he said.
In outlining some of KWL’s strategic plans, he said that even amid the pandemic, the company is about to spend in excess of $1 billion to ensure that the terminal is COVID-resilient and ready for the next 75 years.
KWL will also be spending in excess of US$2 million, he added, to ensure that the terminal and its environment have a robust internationally accepted security system.
“We’ll be spending on CCTV, surveillance coverage, access control, and ensuring that the credentials that are related to security in and around Kingston Wharves meet the highest international standards,” the chief executive told the AGM.
“We want to expand and leverage the strong balance sheet that we have to expand the footprint into nearby territories,” he said, referring to but not specifying acquisition opportunities that the company foresees.
“We also want to diversify our cargo type. What COVID-19 has taught us is that we need to ensure that the business isn’t concentrated in any cargo type,” he said.
Last year, Kingston Wharves made a profit of $2.64 billion, up from $1.97 billion in 2018.
The company closed the March quarter with a narrow gain in revenue to nearly $1.88 billion, and big spike in quarterly profit, from $458 million to $562 million. Still, KWL said in that report that it was not yet in a position to proffer an assessment of the virus’ impact on the business.
Williams said on Thursday that the company’s balance sheet was strong. Against $32 billion of assets, the company has just $1.7 billion of long-term borrowings and $2 billion of current liabilities.
“We are not deterred by COVID-19,” said Williams. “We have put the plans in place and we want to leave you with the assurance that this Kingston Wharves ship remains steady.”
Hall said the impact of COVID-19 on tourism and other industries in Jamaica, and elsewhere in the Caribbean, will adversely affect consumer and business confidence, as well as the level of international trade handled at Kingston Wharves’ terminal and within its logistics business.
However, he said, the company remained confident that its capacity to handle a range of specialised cargo types on behalf of a diverse and multinational customer base would serve to mitigate some of that fallout.
“KWL remains optimistic about the long-term, structural soundness and competitiveness of our core business, notwithstanding the immediate negative impact of the coronavirus pandemic on the global economy,” he said.