POSITIVE FIRST-HALF RESULTS FOR ABP’S SOUTH WALES PORTS

POSITIVE FIRST-HALF RESULTS FOR ABP’S SOUTH WALES PORTS

During the first half of the year, Associated British Ports’ (ABP) South Wales Ports – Cardiff, Barry, Newport, Swansea and Port Talbot – saw a 16 per cent rise in total port tonnage handled.This growth in traffic was led by strong coal imports and iron ore volumes handled at Port Talbot for Corus, following a return to full operational capacity for Corus’s steel mill after the refurbishment of its blast furnace No.5.

Other cargoes continue to benefit from ABP’s investment programme including £2.3 million spent at the beginning of the year in acquiring a new fleet of cranes and handling equipment for the South Wales ports.In May, following a £0.6 million investment by ABP, a new state-of-the-art Vessel Traffic Services (VTS) Centre was commissioned, called ‘Severn VTS’.Now, for the first time, all of ABP’s five ports in South Wales are linked to a central VTS system controlled from ABP’s regional headquarters at the Port of Cardiff.

New business wins and investment in the port’s forest-products sector, completed during 2003, are continuing to drive up volumes of forest products handled by the South Wales ports. The substantial growth experienced during the first six months of 2004 comes as ABP prepares to invest a further £0.5 million, which will fund the construction of a new dedicated timber terminal at Cardiff and assist Cardiff Stevedoring to extend an existing facility in order to grow its steel and timber-handling business.

Recently, ABP announced a new 25-year agreement with W E Dowds, backed by a £1.4 million investment in steel-storage facilities at Newport.At Cardiff, a new £1.1million steel-importing facility for Marshall Maritime Services, built on the back of a 10-year agreement, became operational in July.These developments underline ABP’s commitment to strengthening its steel and metals trade in South Wales.

During the first half of the year, the volume of scrap metal handled during this period decreased compared to the same period in 2003.This was due to normal activities at Sims Group’s facility being disrupted by construction works as part of the company’s major expansion programme at Newport.These works are being carried out as part of a new 20-year agreement between ABP and Sims Group – the Australian international metals-recycling company.Once the expansion programme is completed, volumes are expected to grow.Also at Newport, in connection with this project, a £3.5 million investment by ABP in major capital infrastructure works will be completed in September.

The volume of unit load cargo handled by ABP South Wales has also risen.This is attributable to the success of Coastal Container Lines’ weekly services between the Port of Cardiff and Ireland, and a rise in roll-on / roll-off units which were handled, predominantly by Swansea Cork Ferries, during the first six months of 2004.

Dry bulks including sand, gravel and aggregates also saw growth during the first half of the year.

These results are the first that ABP has issued since it announced in May that it had sold its remaining shareholding in the Cardiff Bay Partnership, to Morley Fund Management (Morley), acting on behalf of Norwich Union life fund clients.The sale of ABP’s residual shareholding in the Cardiff Bay Partnership represented the successful conclusion of ABP’s property development activities in Cardiff Bay, allowing the company to focus on its core ports business.

Commenting on the shape of ABP’s ports business in South Wales, John Copping, ABP Port Director, South Wales Ports, said:

“Investing in key trade sectors and strengthening the diverse range of cargos handled across the region is core to the success of our port operations in South Wales.We will always continue to grow our business by working closely with quality customers and this in turn, will bring further growth and prosperity to the local and regional economy.”

An ABP subsidiary based at the Port of Cardiff, UK Dredging (UKD), distinguished itself earlier this year when it was one of the first companies with UK-flagged vessels to be awarded full International Ship and Port Facility Security certification by the
Maritime & Coastguard Agency. The start of 2004 also saw UKD continuing to provide a cost-effective solution to the substantial maintenance-dredging requirements of ABP’s ports.In addition to its in-house operation, UKD markets its services to non-ABP clients. Term-dredging contracts have been awarded to UKD by Forth Ports and the Port of Workington, and UKD’s client base continues to expand through one-off contracts. With repeat business and the capital-dredging works on the Humber earlier this year, UKD’s fleet has been fully utilised in the first half of 2004.

The first half of 2004 also saw UKD continuing to expand successfully its non-dredging activities, with new contracts won in the fields of hydrographic survey and buoy-maintenance works. UKD Sealion, the latest addition to UKD’s fleet, has been active with a new buoy work term contract in South Wales, and has recently completed service contracts for the Port of Mostyn, and for water and energy provider, United Utilities.

1st September 2004

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