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Steady Growth Continues for ABP

Associated British Ports (ABP), operator of 21 ports around the UK, has reported its underlying UK ports and transport operating profit for 2005 up 3% to £151.3m and underlying group profit before taxation up 2% to £132.3m, translating to a 6% rise in the dividend for shareholders.

During 2005, cargo volumes handled by the group's UK ports rose by 4.3% to 134.8m tons, a continuation of the consistent growth achieved in recent years with a strategy of targeted investment generating new business by securing long-term contracts with customers. Six new long-term customer contracts were won last year, with the group committing £20m of new revenue related capital expenditure. This includes £15m for expansion of the Humber International Terminal, the extension of which is on schedule for completion in the second quarter of this year. The total £59.5m investment in a second deepwater terminal will create a specialist coal importing facility to meet demand from the country's electricity supply industry.

Also on Humberside, an £8.8m programme to upgrade and expand container handling equipment at ABP Exxtor Terminal at Immingham was completed in September, with the delivery of a 40 ton gantry crane and two RTGs boosting box handling capacity by more than 90%. Also at Immingham, a £600,000 investment in a tug mooring facility is due to become operational next month, backed by a 17 year agreement with Adsteam Humber Ltd.

Elsewhere within the ABP stable, the Ports of Hull and Goole reported strong growth in container traffic, aggregates, cement volumes and coal imports. In December the group received final planning approval for its £30-35m shortsea riverside container terminal development at the Port of Hull. This new facility could be operational by the end of 2007.

Although revenue fell by 1.1% at the Port of Southampton due to a decrease in container volumes, the cruise business flourished with 234 vessel calls and a record 702,000 passengers through the port, a rise of some 32%. Revenues rose by 7.5% at ABP's South Wales Ports on the back of strong growth in coal imports and increased volumes for iron ore imports.

Looking ahead, ABP sees the potential for further development opportunities on the Humber and is looking at developing a shortsea coal terminal at Hull which would require an investment of between £55m and £110m depending on the operator. Subject to government approval and customer demand, this facility could become operational in 2009.

MJ Information No: 21636

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