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Hutchison Panama ports arm to pay dividends for first time

Hutchison Panama ports arm to pay dividends for first time
Panama Ports Company (PPC), a subsidiary of Hutchison Ports Holdings that manages the terminals of Balboa and Cristobal on the Pacific and Atlantic entrances of the Panama Canal has announced it will pay dividends to the Government of Panama corresponding to year 2014, the first time since it began operations in 1997.

“The board of directors of Panama Ports Co that include members of Panama’s government which is shareholder in the company, has reviewed responsibly [our financial] results, the situation of the company, its debts and investments realised and decided it will pay dividends for 2014 and 2015,” PPC gm Aitor Ibarreche told Seatrade Global.

Panama Ports Co, of all the private ports in Panama, is the only one where the State, is a shareholder with 10% of the company, the remaining 90% are held by Hutchison Ports Panama (HPP).

For the year 2014, dividends to shareholders are calculated at $10m; and are expected to increase approximately to $15m for 2015.

Under Panamanian law, the Panamanian Government receives from all the port concessions a fee per box operated, this is the main payment received by the Panamanian Government, and PPC is the principal contributor to the Panamanian Government in monthly fees for cargo handling services at ports, since it is the largest port operator in the country having moved 3.7m teu in 2013 and 3.9m teu in 2014.

The Government of Panama and Hutchison Ports Panama (HPP) shareholders of PPC, with a view towards increasing the number of containers moved through the ports, and therefore increasing the fees to be received by the State, agreed several years ago to prioritise re-investment in the expansion of port capacity, so that the shipping cargo [that could have gone to ports in other countries] would pass through Panama instead, thereby bringing Panama to world class port terminal status, explained Ibarreche.

This, in turn, made way for the maritime-port complex to become one of the main pillars of Panama’s GDP and overall economic growth. “To date, PPC has invested more than $1.3bn to expand Balboa terminal –considered today as a mega port – and the port of Cristobal. Those key decisions in the growth of both terminals were necessary initiatives to meet the demands of global maritime trade,” said Ibarreche, who took over the management of Panama Ports Co in January 2014.

"Since we assumed the challenge of taking the reins of the company, we set out to improve our relationships with collaborators/employees, customers, and shareholders of course, which includes the Panamanian Government.  It has always been our priority to keep our commitment to our shareholders, even beyond the debts incurred by the large investment in expanding these ports," he said.

 

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