A Quick Introduction To Westports Holdings Bhd, A Malaysia-Based Blue Chip Company

Westports Holdings Bhd (KLSE: 5246.KL) is a port operator listed on the Malaysian stock exchange.

The company handles shipping containers and bulk cargo flowing through its port in Klang. Westports also provides a range of services such as marine services, rental services and other ancillary services.

For Singapore investors, the port operator might be as well known as other Malaysian blue chips such as Malayan Banking Berhad (KLSE: 1155.KL) or Nestle (Malaysia) Berhad (KLSE: 4707.KL).

With that in mind, I will like to start with a quick introduction to Westports.

Starting with the basics

Westports is located in Port Klang. It is one of the three main ports in the Straits of Malacca that handles gateway and transhipment container cargo. The Klang port has the advantage of natural deep water berths which allows it to accommodate large vessels.

In 2016, Westports’ container business handled 9.9 million TEUs (twenty-foot equivalent units). Based on that, the port operator had a 76% market share in Port Klang, 18% in the Straits of Malacca and 10% in South East Asia for 2016.

In addition, Westports’ conventional terminal handled 11.8 million tonnes of bulk cargo in 2016, representing 62% market share of conventional cargo handled in Port Klang. The cargo comprises of mixed steel, steel coil, animal feed, edible products, palm oil, petroleum products and more.

Sprinkle in some numbers

In my view, no introduction is complete without financial numbers.

As such, I would like to share some key metrics about Westports to give investors a more rounded view of the company.

First off, let’s look at the topline. From 2012 to 2016, Westport grew its revenue from RM 1.49 billion to RM 2.04 billion, up 36.9%.

Next, the company grew its profit attributable to shareholders from RM 359 million in 2012 to RM 637 million in 2016, up by 77.4% during the period. At the same time, earnings per share (EPS) grew at a slower rate of 55.8%, up from 12 sen in 2012 to 18.7 sen in 2016.

Shareholders who held Westports shares have also benefitted from dividends. Interestingly, the dividend payout ratio remained at around 75% over the five year period above. Given that EPS has risen by 55.8% during the period, DPS (dividend per share) was also up from nine sen in 2012 to 14 sen in 2016.

Foolish takeaway

In all, Westport is an important port operator in Malaysia, and the Straits of Malacca. It might be well worth the investor’s time to dig deeper, as the company has been growing its revenue and profits over the years.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. The Motley Fool Singapore has recommended shares of Nestle Malaysia. Motley Fool Singapore contributor Lawrence Nga doesn’t own shares in any companies mentioned.