In a filing with Bursa Malaysia today, the group said the 21% increase was due to the corporate tax rate reverting to 24% following the one-off prosperity tax in Q1 FY2022.

The prosperity tax was a one-off tax measure introduced by the federal government in the 2022 budget.

Companies with a chargeable income above RM100 million were taxed at a rate of 33% instead of the usual 24% corporate tax rate.

Westports’ profit before tax for Q1 FY2023 declined 5% to RM237 million compared to the previous year, which the group said was due to the reduction in container value-added services revenue.

Operational revenue dropped 3% to RM503 million compared to RM516.3 million in Q1 FY2022.

“This decline was primarily due to the lower value-added services, in particular storage revenue,” the Bursa filing said.

In a separate statement, Westports managing director Ruben Emir Gnanalingam noted that the one-off prosperity tax in 2022 provided a lower base in the previous reporting period, which was reflected in this quarter’s improved performance.

“As such, Westports is able to report an improved profit after tax of RM184 million for Q1 FY2023 despite recording a lower profit before tax,” Ruben said.

The largest listed port operator in the country said the container segment contributed 86% to total revenue with a throughput volume of 2.55 million twenty-foot equivalent units (TEUs) this quarter.

Ruben said Westports handled more transhipment and gateway containers – the latter amounted to 1.03 million TEUs – despite inflationary pressures and slowing economic momentum in many economies.

“The domestic economy exhibited resilience as export-oriented sectors have benefitted from increased competitiveness while certain segments have benefitted from regionalisation and foreign direct investments,” Ruben said.

“Intra-Asia has continued to underpin the company’s throughput volume as it constituted 63% of the total container volume handled,” he said.

Despite the promising quarterly performance, Ruben pointed out that the company faced increased costs which had dampened its profitability.

Manpower cost has increased, even without a higher headcount, in order to incorporate higher salaries and allowances paid to all staff members, he said.

There was also a notable increase in electricity cost as the national utility company had implemented the current imbalance cost pass-through (ICPT) effective Jan 1, 2023, which increased the tariff rate from 3.7 sen per kWh to 20 sen per kWh.

“These key factors contributed to a lower profit before tax of RM237 million for Q1 FY2023,” he said.

Meanwhile, the group’s conventional segment saw improved throughput as they cater to growth in non-bunker fuel and liquid storage requirements.

“The completed liquid bulk terminal 5 recorded active utilisation, so we have embarked on building liquid bulk terminal 4A, scheduled to be completed by the end of 2023,” Ruben added.

Moving ahead, the group expects an overall uptrend in decarbonisation cost as it implements more initiatives to achieve its commitment to net-zero carbon emissions by 2050.