Issue link: https://jocdigital.uberflip.com/i/719220
LOS ANGELES-LONG BEACH TERMINAL OPERATORS SCRAP PROPOSED UNIFORM CHASSIS FEE FOLLOWING INTENSE PUSHBACK from ship- pers, truckers and intermodal equipment providers, terminal operators at the ports of Los Angeles and Long Beach scrapped plans for a proposed uniform fee on chassis enter- ing their facilities. Frustration over the p r o p o s e d $ 5 - p e r - c h a s s i s s e r v i c e f e e spurred equipment-leasing companies, in a show-cause petition to the U.S. Federal Mari- time Commission, to ask regulators to tell terminals to "cease and desist." Although t he uniform fee, which was set to ta ke effect on Sept. 1, has been retracted, indivi- dual terminals will negotiate directly with chassis-leasing companies on compensation for hosting their equipment. PierPass Inc. President John Cushing, who represents the West Coast Marine Terminal Operat- ing Agreement, said those individual nego- tiations are under way. Member companies will likely seek compensation for chassis storage, the use of longshore labor to stack and unstack chassis, and reimbursement for electronic data interchange transmission of data on chassis usage, which the intermo- dal equipment providers use to bill customers. The terminal operating group didn't offer an explanation for its change in tactics. MAERSK REVIEW SPARKS CHATTER OF DAMCO, APMT SPINOFFS MAERSK GROUP'S PLAN to announce results of its ongoing strategic and structural review of group operations at the end of September is fueling further speculation that some of the group's businesses may be sold off. The group booked a profit of $118 million in the second quarter, compared with $1.1 billion a year earlier; Maersk Line reported a net loss of $151 million for the period. Netherlands-based APM Termi- nals, the group's terminal operating arm, also is having a difficult year with second-quarter profit down more than 30 percent year-over- year after a 41 percent drop in profit booked in the first quarter. APMT handled 9.4 million 20-foot-equivalent units in the second quar- ter, representing a year-over-year increase of 2.6 percent, attributed primarily to the acqui- sition of Grup Maritim TCB. Like-for-like throughput increased just 0.2 percent. How- ever, the terminal development and operating business remains a very profitable one, with underlying net income excluding one-time items of $109 million delivered in the second quarter. The benefit APMT brings to Maersk Line's operating margin through lower handling costs, which it estimated give it an EBIT mar- gin advantage of up to 1.5 percent over its rivals, make it less likely the business would be sold off, Alphaliner said. "The symbiotic relation- ship between Maersk Line and APMT suggests that a divestment of the terminal operations should likely be avoided at this stage, especially since the weak state of market weighs heavy on the valuations of APMT and other terminal operators," the analyst said. With an estimated valuation of $1 billion to $1.4 billion, Alphaliner said the divestment of Damco is a more likely outcome of the review, as the sale would improve the balance sheet of the group without impact- ing the liner shipping network. Spotlight 6 THE JOURNAL OF COMMERCE www.joc.com SEPTEMBER 5.2016 6 THE JOURNAL OF COMMERCE www.joc.com