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World Bank Transportation Forum

Strategy & Perspectives From A Private Terminal

Operator, Investor, and Major Carrier

Eugene K. Pentimonti

Vice President Government Affairs

Washington

March 9, 2005

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Source: Drewry

Enter a world of efficiency Page 10

Demand

0

100

200

300

400

500

600

1991 1995 1999 2003 2004 2005 2009

TEU Mill

317 M

359 M

405 M

575 M

97 M

145 M

210 M

The global container port industry is an attractive, high

growth business CAGR(2004 -09)

10%Africa 8%SAM 11%

Middle East 9%

North

America 6%

Europe 7%

Oceania &

Asia 11%

Far East 11%

CAGR: 1991-0411% 2004-0910%

USA/European consumer growth and continued globalization drives strong

Chinese economic growth

Terminal Utilization will increase to 97% in 2009 (from 79% in 2004) unless

further capacity beyond known projects is secured. (Capacity CAGR 2004-09

is 4% versus throughput growth of 10%)

Industry Revenue in 2004 is approx. USD 50 Bil, and increasing to USD 78

Bil in 2009Source: Drewry

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Key Industry Trends

High industry growth due to growing world trade and rate

of containerization

Emergence of global operators

Operator growth via the organic route and portfolio

expansions Increasing consolidation via M&A

Larger ships mean larger and better ports

Focus on productivity and efficiency of operations

Hub terminals

Privatization

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Buenos Aires

Majority shares

Joint ventures

Under development

O&M contract

Onne

Pipavav

Salalah

Pt. SaidAqaba

Pt. Qasim

Douala

Mumbai

Tangier

Tema

Focus Developing World

Potential high growth areas like Africa, India, Middle East accompanied by high risk

Established APM Terminals operations in Nigeria, Egypt, Angola and Cameroon & projects

under implementation in Morocco and Ghana

Established APM Terminals operations in India, Pakistan, Oman, Jordan and Iraq &

projects under implementation in India

Luanda

Al Zubayr

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Investment drivers

Improved trade facilitation (overall logistics and value to

customer)

Distribution infrastructure availability

Identifying potential capacity bottlenecks early

Increasingly long term view in opportunity identification

Focus on high growth areas e.g. India and potentially highgrowth areas e.g. Africa

Common user facilities and independently profitable

ventures

A truly global portfolio, with strategic long term value to

global commerce Creating new capacity in order to alleviate trade

bottlenecks instead of competing for cargo

Cost reduction

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APM Terminals - Strengths

Detailer understanding of trade facilitation and shipping

lines Extensive terminal development and implementation

competencies

A very strong and dedicated work force withentrepreneurial spirit

Well developed and mature human resource development(global/local) programs

Financially strong shareholder

Strong experience with developing and operatingcontainer terminals in developing countries

APM-M brand

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Investment evaluation tools

Long term traffic forecasts with strong focus on sensitivity

analysis

360 degrees risk assessment with strong focus on

political, legal and environmental risk

Financial tools viz. NPV, IRR and Payback with standard

regional benchmark figures

High level evaluation followed by detailed market study

Process Stop-gap to ensure consistency and quality in

project evaluation process

Continuous focus on Corporate Social Responsibility

deliverables

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Lessons From Past Projects

Ports dont belong in middle of city

Assure room for expansion

Containerization spawns growth

Multiplying effect

Distribution effect

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Facilitation Needs from World Bank

Funding of basic infrastructure e.g. breakwaters, quay

walls etc.

Ensuring a fast, fair and transparent tender process

Creating and maintaining a legal framework

Protecting right to peaceful terminal operations and then

ensuring peaceful operations Faster funding process for countries

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Questions?