Page 29 - ar2011_hi

ANNUAL REPORT 2011 // 27
Growth Strategy
The Trust’s strategic objective is to ensure its industry
leadership position is sustainable. This should provide
unitholders with stable and regular distributions and
long-term DPU growth. To achieve these objectives,
the Trust will implement the following:
Active business and asset management
To stay ahead of the competition and improve throughput
at its ports, the Trust actively plans and implements
initiatives to improve facilities and infrastructure,
customise innovative solutions, provide value-added
services to customers, and maintain close rapport
with key stakeholders. At the same time margins are
kept consistently within targets through enhancing our
throughput mix, improving operational effciency,
and reducing operating costs.
Risk and capital management
Maintaining an optimal capital structure will enable the
Trust to effectively implement growth strategies and
engage in accretive acquisitions that will maximise returns
to unitholders. The Trust also adopts a proactive interest
rate management policy to manage the risk associated
with fuctuations in the interest rate environment.
Development and acquisition
The Trust selectively pursues value-enhancing
development projects and third party acquisition
opportunities. Consolidation and investment opportunities
in the deep-water container port market in the PRD are
promising as expanding trade activity increases demand
for deep-water container ports.
HPH, the world’s top port operator, has granted the Trust
certain rights to participate in, and rights of frst refusal
over, any future deep-water container ports developed or
acquired by HPH in the PRD.
Outlook
With the shadow of Euro-zone debt crisis continuing and
global economic recovery in doubt the market outlook for
2012 is unclear.
Challenges will certainly remain as global consumer
spending growth is weak and demand for manufactured
goods in the US and Europe is lacklustre. However with
the Trust’s market-leading domination of the world’s most
signifcant trade lanes, Europe to Asia and US to Asia,
coupled with its strategic location among the growing
economies of emerging markets, container shipping and
throughput will expand in the long-term. The Chinese
economy also appears to be resilient and there have been
a number of trade-related government policies which
support exporters and manufacturers.
In anticipation of the growth of container shipping through
the PRD the Trust has embarked on organic expansion
projects at HIT and COSCO-HIT and capital infrastructure
works at YICT to provide increased future capacity.
Although the near-term outlook is uncertain, the long-
term position of the Trust as the preferred deep-water
ports operator in the PRD is strong. The management
team will monitor economic trends ceaselessly in 2012 in
order to ensure the Trust reacts accordingly to any change
in global or industry circumstances.