The Directors submit their annual report together with the audited financial statements of the Company for the year ended 31 December 2008.
Legal Status
Dublin Port Company is a limited liability company established pursuant
to the Harbours Act, 1996. On 3 March 1997 the Company became the successor
entity to Dublin Port & Docks Board, the former statutory entity
with responsibility for the Port of Dublin. On that date Dublin Port
Company took over the functions and acquired the assets and liabilities
of the predecessor organisation at valuations agreed with the then Minister
for Communications, Marine and Natural Resources. In consideration for
the assets and liabilities, the Company issued share capital in the
amount of €7.648m to the then Minister for Communications, Marine and
Natural Resources.
With effect from 26 July 1997 the Company became the pilotage authority for Dublin Bay.
Responsibility for the Commercial Port Sector was transferred from the Minister for Communications, Marine and Natural Resources to the Minister for Transport with effect from 1 January 2006.
Principal Activities
The business purpose of Dublin Port Company is to facilitate the movement
of goods and passengers, and attendant information flows through the
Port.
The Company provides the infrastructure, facilities, services and hard standing to meet the needs of customers for the efficient transfer of goods and passengers between land and sea transport modes.
Revenue in connection with the provision of these facilities is generated from vessel dues, goods dues, rent and key services provided, such as towage and pilotage.
Going Concern
The Directors are satisfied that the Company has adequate resources to
continue in business for the foreseeable future. For this reason, the
financial statements are prepared on the going concern basis.
Books of Account
The Directors have taken measures to ensure compliance with the Company’s
obligations under S.202 of the Companies Act 1990 with regard to keeping
proper books of account. The measures taken are the use of appropriate
systems and procedures and the employment of competent accounting personnel.
The books of account are kept at the Company’s registered office, Port
Centre, Alexandra Road, Dublin 1.
Business Review
Details of the profit for the year, together with comparative figures
for 2007, are set out in the Profit and Loss Account on
page 23 and
the related notes.
Throughput fell by 4.4% from 30.9 million tonnes in 2007 to 29.6 million tonnes in 2008. Despite this fall in throughput 2008 remained a strong financial year for the Company.
Turnover for the year amounted to €70.6m, a marginal increase on the previous year (2007: €70.5m). Total Operating Costs fell to €43.6m in 2008 from €48.8m in 2007. This was mainly due to lower Exceptional Operating Costs of €5.7m relating to redundancy payments and associated early retirement pension costs.
Operating Profit increased to €27m in 2008 from €21.7m in 2007 resulting in an Operating Margin of 38% (2007: 31%). The underlying Operating Profit Margin, before Exceptional Operating Items, remained strong at 39.8% (2007: 40.5%).
Profit retained for the financial year was €18.4m (2007: €125.5m). The 2008 figure reflects a gain of €1.8m, net of related Capital Gains Tax of €0.4m, arising from the disposal of a site to Dublin City Council in respect of the Waste to Energy facility proposed for the Poolbeg Peninsula. The 2007 figure reflects a gain of €109.2m, relating to profit from the sale of the former IGB site in January 2007, net of costs and related Capital Gains Tax of €26.2m.
The Profit and Loss Reserve increased from €206.4m at 31 December 2007
to €207.9m and Shareholders’ Funds decreased from €221.0m to €219.0m during
the same period.
The Company has a target throughput of 27 million tonnes for 2009. Throughput of 29.6 million tonnes was achieved in 2008, which was 9% down on its target of 32.5 million tonnes.
Environmental Matters
Dublin Port Company has again demonstrated in 2008 its commitment to the
highest environmental performance by achieving not only accreditation
to EcoPorts through PERS certification but also in September it was
awarded ISO14001, the highest international environmental standard.
In July at the C40 World Port Climate Conference Dublin Port Company committed to “Adopt, within its own sphere of responsibility, The World Ports Climate Declaration as a document to guide action to combat global climate change and improve air quality”.
This declaration covers:
• Reduction of greenhouse gas emissions from ocean-going shipping
• Reduction of greenhouse gas emissions from port operations and development
• Reduction of greenhouse gas emissions from hinterland transport
• Enhancement of the use of renewable energy
• Development and auditing of CO2 inventories
In November 2008 Dublin Port Company shared its experience and knowledge on environmental management with participants at the UNCTAD training programme.
Dublin Port Company is active within the sustainability committee of ESPO (European Sea Ports Organisation) and keeps abreast of new technology to ensure it maintains continuous improvement in all its practices.
Resource management is a major focus and water usage in the Port has been driven down considerably through the introduction of new water meters and sectioning the Port into district monitoring areas. Electricity usage has also been reduced through better energy management using new technology, including for example the installation of a wind turbine on the North Bull lighthouse to compliment the solar panels already fitted and the installation of the new lighting controls at No. 1 Terminal which is due for completion in quarter 1 2009. Waste management streaming both in the wider port area as well as offices illustrates that Dublin Port Company with the proactive assistance of its staff lives the reduce, reuse, recycle message.
Through site wide audits Dublin Port Company is raising environmental awareness and performance with all its partners in the estate and is most grateful for their continuing cooperation.
Employee Matters
Building on achievements to date in improving organisational effectiveness
and capabilities the Company commenced significant reviews of key areas
of Company operations during 2008. These reviews are due for completion
in 2009.
The Company will continue to focus on enhancing organisational capabilities throughout 2009 through significant initiatives in the areas of Training & Development, Health & Safety and Equality & Inclusion reviews.
Principal Risks and Uncertainties
Dublin Port’s unitised trade has grown by an average of 5.5% per annum
over the last 10 years. The principal risk inhibiting the Company’s
continued growth and ability to facilitate the movement of goods and
passengers arises from the potential shortage of operational capacity.
In this regard the Company has put forward its plan to address the capacity
shortfall and awaits a decision on its foreshore application made to
the Minister in March 2002 in relation to its proposal to expand the
Port at the North Eastern perimeter. The Company’s proposal to expand
the Port at the North Eastern perimeter qualifies to be considered under
the Strategic Infrastructure legislation and a detailed planning application
and Environmental Impact Statement was submitted to an Bord Pleanála
in August 2008. At the time of writing of the Annual Report a date had
not been set for an oral hearing. It is anticipated that this will take
place in May 2009.
As evidenced by the fall in trade in the latter half of 2008 and continuing into 2009 the Company is exposed, through the normal course of its operations, to the impact of an economic slowdown on port activities.
Financial Risk Management
The Company’s operations expose it to a variety of financial risks that
include foreign exchange risk, interest rate risk, credit risk and liquidity
and cash flow risk. Policies to protect the Company from financial risks
are kept under regular review. The Directors have not delegated the
responsibility of monitoring financial risk management to a sub-committee
of the Board. The Policies are set out by the Board of Directors and
are implemented by the Company’s Finance Department.
Foreign Exchange Risk:
The Company transacts the majority of its business in Euro and therefore
has limited exposure to foreign currency movement.
The Company also borrows directly in Euro.
Interest Rate Risk:
In order to manage the Company’s exposure to significant adverse interest
rate movements, the Company has a policy of maintaining a minimum of
60 per cent (2007: 60 per cent) of its debt at fixed interest rates.
In order to achieve this objective, the Company has in place interest
rate swap/cap agreements.
Credit Risk:
The Company is exposed to credit risk in the course of trading and to
manage this risk it carries out appropriate credit checks on potential
customers and trades only with recognised creditworthy third parties.
Liquidity and Cash Flow Risk:
The Company maintains a mix of short and medium term debt finance to ensure
sufficient funds are available for planned capital investment. At the
end of 2008 the Company had in place un-drawn committed facilities of
€9 million. The Company’s policy is to hold minimal levels of surplus
cash and where surplus cash balances are available these are invested
on a short-term basis in low-risk cash deposits. The Company is in discussions
with its lenders in relation to rescheduling and extending the existing
facilities and is satisfied on the basis of these discussions that such
facilities will be forthcoming.
Post Balance Sheet Events
There have been no events between the Balance Sheet date and the date
on which the financial statements were approved by the Board.
Future Developments
The Company has a budgeted Capital Investment Programme of €28m for 2009.
The planned Capital Investment Programme includes:
• Berth 50 Development;
• New Tugs;
• Aggregate Berth;
• Graving Dock Infill;
• Caissons
Results and Dividends
The Company’s profit for the financial year amounted to €23.5m. The Directors’
allocations and recommendations in respect of this amount were as follows:
| €’000 | |
| Interim Dividend of €0.441 per share paid | 5,108 |
| Increase in Profit Retained | 18,391 |
| Profit for the Financial Year | 23,499 |
The Directors do not propose to declare a final dividend.
Directors’ and Secretary’s Interests
The Directors and Secretary and their families had no beneficial interest
in the share capital of the Company at 31 December 2008 and 2007.
There were no contracts or arrangements of any significance in relation
to the Company’s business or that of its related Company
in which the Directors and Secretary of the Company or their families
had any interest, as defined in the Companies Act, 1990.
Joint Venture
Details of our interest in a Joint Venture are set out in note
11 to the
financial statements.
Prompt Payments Act
It is Company policy to pay suppliers in accordance with the terms of
the European Communities (Late Payments in Commercial Transactions)
Regulations, 2002 and the Prompt Payments of Accounts Act, 1997.
To this end, the Company’s payment routines are designed to provide reasonable assurance against material non-compliance with the terms of the Regulations. The standard credit period is 30 days unless otherwise specified in contractual arrangements. Substantially all payments by number and value were made within the appropriate credit period as required. Consequently, the Directors are satisfied that the Company has complied with the requirements of the Act.
Directors
The names of the persons who were Directors at any time during the year
ended 31 December 2008 are set out below. Unless otherwise indicated
they served as Directors for the entire year.
J Burke
E Connellan
P Bourke
C Bryce
K Humphreys
T Hussey
B W Kerr
J Kiersey
P Magner
J Moore
C Rochfort
T Stafford
Auditors
The auditors, PricewaterhouseCoopers, were re-appointed in accordance
with section 160(2) of the Companies Act, 1963.
On Behalf of the Board
BW Kerr
E Connellan
26 March 2009