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NO INTERIM DIVIDEND AS PROFIT TUMBLES, REVEALS SWISSPORT - FINANCIAL-24

In Summary
The ground handling company said in its un-audited financial results yesterday that it registered a 12 per cent drop in revenue during the first half of the current year, attributing the fall to reduction in the volume of cargo handled.

Dar es Salaam. Investors with Swiss port Tanzania will not receive an interim dividend from the company’s operations during the first half of the current year as profits have dropped, the company has announced.

The ground handling company said in its unaudited financial results yesterday that it registered a 12 per cent drop in revenue during the first half of the current year, attributing the fall to reduction in the volume of cargo handled.

The statement, signed by board chairman Mark Skinner, chief executive officer Mrisho Yassin and chief finance officer Robert Kimambo, said Swissport registered Sh26.109 billion in total revenue during the first half of this year compared to Sh29.472 billion garnered during a similar period last year.

It states that flight frequencies during the first half of 2017 were 10 per cent lower than during a similar period. This resulted into a seven per cent fall in the volume of cargo handled by the company.

As such, actual profit for the period dropped by 27 per cent to reach Sh6.271 billion from Sh8.644 billion that was registered between January and June 2016.

This happened during a period when Swissport was also making scheduled periodic payments (amortisation) for the costs associated with the construction of its new cargo import facility at the Julius Nyerere International Airport (JNIA).

“Despite a decrease in revenue, operating costs remained the same as prior year, mainly due to the amortisation of the new cargo import facility which has largely offset savings made year to date,” the statement reads.

The company spent a total of Sh26.5 billion on the new cargo facility, which, coupled with investment in new equipment, necessitated the board to declare no interim dividend.

“Due to significant spending made on the cargo facility as well as continued investment in new equipment and technology in 2017, the board has decided not to declare interim dividend and to use the funds to support further investment in operating equipment and financing maturing obligations,” the statement reads.

Though Swissport says it managed to retain its customer portfolio, the year also saw the coming of a new operator at the JNIA that ostensibly ended the company’s (Swissport’s) monopoly over the business.

Nas-Dar Airco -- a joint venture of Kuwait-based Nas and Airco Companies of Tanzania -- was launched last year to become the second ground handling service provider at the port.

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