By Ken Nagy, CFA
On May 16, 2013 Grupo TMM (GTMAY) the Mexican intermodal transportation and logistics Company, released results for its first quarter ended March 31, 2013.
Maritime remains the dominant division at Grupo TMM. The Company's offshore business continued with high utilization and Ports and Terminals reported increased auto exports at Acapulco, particularly South America bound, as well as higher volumes at maintenance and repair.
As a result, Grupo’s consolidated revenue for the first quarter fiscal 2013 was strong at $837.0 million pesos, improving year over year by $27.9 million pesos, from $809.1 million pesos for the comparable quarter of 2012.
The improvement in year over year sales for the segment was primarily due to a 7.9 percent revenue increase at offshore, as a result of higher average daily tariffs, to having two additional vessels in the fleet and to improved utilization, which grew from 92.4 percent in the 2012 first quarter to 95.7 percent in the 2013 reported quarter. Additionally, parcel tanker revenue improved 26.1 percent year over year due to higher volumes, and harbor towage revenue grew 9.3 percent due to an improved revenue mix attributable to the Liquefied Natural Gas, or LNG, services.
Grupo’s Maritime revenue for the first quarter improved nearly 5 percent or by $25.6 million pesos year over year to $554.5 million pesos.
Maritime operating profit for the quarter increased 16.8 percent year over year as a result of revenue increases at offshore and harbor tugs. Operating margin increased to 20.8 percent from 18.6 percent in the 2012 first quarter.
Also worth noting is that Maritime's EBITDA for the 2013 first quarter grew 9.2 percent to $257.4 million pesos compared to $235.8 million pesos in the 2012 first quarter. Likewise, EBITDA margin at Maritime improved in the 2013 first quarter to 46.4 percent compared to 44.6 percent in the 2012 first quarter.
Excluding other income net in both reported periods, consolidated operating profit in the 2013 first quarter was $35.9 million pesos, improving 13.6 percent from $31.6 million pesos in the 2012 first quarter. Other income net was $10.5 million pesos in the 2013 first quarter and mainly included $5.9 million pesos in cash dividends from affiliates and $1.6 million pesos in net tax recoveries. In the 2012 first quarter, other income net of $27.5 million pesos included $28.7 million pesos in cash dividends from affiliates, offset by a $1.3 million peso reserve for expenses associated with an arbitrage at the Maritime division.
Consolidated EBITDA in the 2013 first quarter was $203.7 million pesos compared to $213.6 million pesos in the 2012 first quarter.
The Ports and Terminals segment continued its trend of revenue growth, improving by $20.9 million pesos to $97.7 million pesos. Likewise, the Ports and Terminals segment’s operating profit during the 2013 first quarter increased 37.9 percent compared to the 2012 first quarter, largely due to profit improvements at Acapulco and at maintenance and repair, specifically at the Veracruz, Manzanillo and Altamira facilities.
As of March 31, 2013, TMM's total net debt was $9,891.7 million pesos. The Company paid approximately $395.0 million pesos of its Trust Certificates debt, including a capital prepayment of $5.0 million pesos. Of Grupo TMM’s total debt, only $239.1 million pesos or 2.4 percent is short term. This compares to $332.6 million pesos or 3.1 percent of total debt being short term as of December 31, 2012.
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- Consumer Discretionary