PSA’s profit down amid turbulent waters in global trade

Amidst global inflationary pressures and market volatility, Singapore-based port operator PSA International Pte Ltd (PSA) faced a decline in profitability for the fiscal year ending December 31, 2023.

The group handled a 94.8 million Twenty-foot Equivalent Units (TEUs), marking a 4.3% growth compared to the previous year.

PSA Singapore contributed 38.8 million TEUs, and terminals outside Singapore delivered 56.0 million TEUs, showcasing increases of 4.8% and 3.9% respectively.

Nevertheless, the port operator grappled with financial setbacks having reported an 11.2% decline in revenue, reflecting the strain of challenging market conditions and weak trade demand.

Furthermore, PSA recorded a 2.6% decrease in profit from operations and an overall 6.3% reduction in net profit for the year. The overall revenue was S$ 7 billion (USD 5.1 billion), while net profit reached S$1.5 billion.

These figures were attributed, in part, to escalating cost inflation and increased finance expenses, posing significant challenges to PSA’s financial stability.

“2023 was a year of transition amidst global trade uncertainty. Inflation, rising interest rates, tight labour markets, geopolitical tensions, and ongoing wars impeded economic recovery worldwide. The PSA Group faced a challenging and constantly evolving business environment, but we continued to demonstrate resilience and grit while working alongside our customers, partners and stakeholders to navigate the unchartered waters,” Peter Voser, Group Chairman, PSA International, said.

“Although there was a collective push for economic recovery in many developed countries, the global economy remained fraught with volatility in 2023. Despite the challenges around the world which destabilised the outlook for recovery and disrupted supply chains, the PSA Group achieved a new record of handling 94.8 million Twenty-foot Equivalent Units (TEUs) of containers for the year ended 31 December 2023,” Ong Kim Pong, Group CEO, PSA International, said.

“Looking ahead to 2024, PSA will continue to focus on expanding our core business of ports and enabling more agile and resilient supply chains. In the face of uncertainties in the macroeconomic environment, PSA is committed to strengthening its fabric of port networks and supply chain services to support sustainable global trade flows.”

PSA boasts an extensive portfolio comprising over 60 deep-sea, rail, and inland terminals spread across more than 170 locations in 44 countries, with flagship port operations in Singapore and Belgium. Beyond port operations, PSA has also ventured into affiliated businesses, including supply chain management, logistics, marine services, and digital solutions.