WESTPORTS HOLDINGS BERHAD

Westports RELENTLESS SUPPLY-DRIVEN GROWTH

www.westportsmalaysia.com

Westports

RELENTLESS SUPPLY-DRIVEN GR Westports adopts all inclusive objectives of economic returns, productivity and sustainability RESEARCH BY

2

Joseph Philips

[ DEC 2018 ] BUSINESS EXCELLENCE

ROWTH

BUSINESS EXCELLENCE [ DEC 2018 ]

3

estports Malaysia commenced its business in 1994 with conventional operations. The containership operations commenced later in 1996 with one Container Terminal (“CT”), now known as CT1.

Back then, there was one transhipment port in the region and Malaysia’s imports and exports essentially have to go through Singapore. So, opportunities beckons! By 1997, container terminal expansion was completed and CT2 raised Westports container handling capacity to 3.0m twenty-foot equivalent units (“TEUs”).

Against the backdrop of the then Asian Financial Crisis in 1998, container volume at Westports still continued to grow unabated by double-digit growth rates. CT3 was completed in 2001. With the supply-driven approach towards container terminal expansion, CT4 and subsequently CT5 was completed in 2008.

With the Global Financial Crisis engulfing the world, Westports container volume eased in 2009 by merely 10%. And incidentally, 2009 was also the only year when global container volume experienced a decline.

The double-digit growth resumed in 2010 and necessitated another expansion. CT6 was completed in 2013 and with sustained high levels of utilisation, CT7 started soon thereafter, which was immediately completed by the end of 2014. And within the same month CT7 was completed, it accommodated the then largest container vessel – MV CSCL Globe of 19,100 TEUs. With the emergence of global shipping alliances, where Westports is the regional transhipment hub of choice for Ocean 3, comprised of CMA CGM, United Arab Shipping

W

“Westports still continued to grow unabated by double-digit growth rates”

4

[ DEC 2018 ] BUSINESS EXCELLENCE

WESTPORTS

“Westports has experienced tremendous growth over the two decades with its supply-driven approach towards container terminal expansion” Company and China Shipping Container Lines, the latest expansion commenced early in 2015 to build CT8, which has been contracted to Muhibbah Engineering (M) Bhd. And when CT8 is completed by mid-2017, Westports would have increased its container handling capacity to 13.5m TEUs. It would be equipped with additional container gate for more efficient container traffic movement into and out of the entire port, 15 more units of fuel efficient Rubber Tyred Gantry Cranes (“RTGC”) and also 14 new ship-to-shore Quay Cranes (“QC”).

Sustainability Also Generates Economic Returns Westports has experienced tremendous growth over the two decades with its supplydriven approach towards container terminal expansion. Delivering best-in-class level of service has always been a top priority and this core emphasis has subsequently yielded in favourable economic returns and also adoption of sustainability in the Group’s strategy and investing decisions.

When it comes to investment decisions in container terminal handling equipment, in addition to the required analysis on initial investment outlay, operational and regular maintenance costs, Westports also solicit feedback from its staff and equipment operators – they are the

BUSINESS EXCELLENCE [ DEC 2018 ]

5

ones that ultimately directly contribute to the service levels and world-record productivity that the port achieves.

So, when Westports embarked on its then latest CT6 expansion plans, which was subsequently completed and commissioned into service in March 2013, the Group was then using a fleet of conventional diesel-powered Rubber Tyred Gantry Cranes (“RTGC”). In order to enhance economic returns and productivity levels, new fuel efficient RTGC concepts were evaluated despite the much higher initial investment costs as they all claimed to reduce overall fuel consumption.

Westports ultimately ordered a fleet of Variable Speed (“VS”) RTGC and also Hybrid RTGC from Mitsui-Paceco. And Mitsui-Paceco has been supplying container terminal handling equipment to Westports from the very beginning in 1996. The fleet of new RTGC were all delivered and subsequently fully commissioned into service by mid-2014 for CT6. And when CT7 was completed by the end of 2014, the VS and Hybrid RTGC consisted 27% of Westports total fleet of 157 RTGC. By operating a fleet of RTGC with basically three different power configurations and close monitoring of their performance for more than

“Westports is now able to confirm that the objective of achieving a more favourable economic returns, despite the higher investment outlay”

6

[ DEC 2018 ] BUSINESS EXCELLENCE

WESTPORTS

a year, Westports is now able also the most energy efficient.

Did you know? to confirm that the objective Westports has embarked on of achieving a more favourable its latest terminal expansion, economic returns, despite the CT8, which should be completed 420 units of higher investment outlay, has by the middle of 2017. Being a terminal tractors also enhanced sustainability with publicly listed entity with growing continuously reduced diesel consumption and awareness of its environmental transporting the GHG emissions. footprint, the Group will strive 8.4 million of The VS RTGC has reduced diesel to strike an optimum balance TEUs handled fuel consumption by controlling and all inclusive need between

by Westports the engine speed and matching it generating economic returns with the required container load. required by all shareholders while Meanwhile, the Hybrid RTGC also enhancing sustainability in featured smaller engines and is the Group’s operations. And the complemented with Lithium Ion battery power new RTGC for CT8 are also Mitsui-Paceco’s to reduce fuel consumption and lower emissions. fuel-saving model.

The Hybrid RTGC cost the most but because it While cranes do the heavy lifting, the can recover and convert the kinetic energy into workhorse shuttling the containers between electric energy and stored inside the batteries the container yard and the berthed vessels when hoisting down the container, hence, it is are the terminal tractors. With 420 units of

BUSINESS EXCELLENCE [ DEC 2018 ]

7

terminal tractors continuously transporting the 8.4 million of TEUs handled by Westports in 2014, even the most robust machines are susceptible to wear-and-tear. Balancing between operating and maintenance cost, performance-reliability and fuel consumption and emissions, the terminal tractors are replaced after seven to eight years.

Additionally, Westports’ latest fleet of terminal tractors are designed to run on Euro 5 grade diesel. By the end of 2015, Westports will use Euro 5 grade diesel for its newer terminal

8

[ DEC 2018 ] BUSINESS EXCELLENCE

tractors. This fuel has a sulphur content of only 10 parts per million (ppm), compared to 500 ppm for current Euro 2M diesel available domestically. The new formulation would reduce emissions of harmful pollutants while improving the longevity of the diesel engines.

While terminal handling equipment may be the obvious area for efficiency gain and cost reduction, Terminal Lighting is another area as Westports is a truly 24x7x365 port that operates all year round. Westports embarked on implementing energy efficient terminal

WESTPORTS

“To minimize water pipe leakages and the loss of water, Westports now uses HDPE (High Density Polyethylene)�

lighting by adopting prismatic lens technology in 2011. The premise of prismatic lens allows for more focussed spread of light to the ground level while requiring lesser 315W bulb capacity compared to previous 1,000W High Pressure Sodium bulbs. Energy savings of 68% per lamp is achieved. For building lighting, Westports converted incandescent lamps at two of its Administration buildings to LED types in 2014.

LEDs uses between 40% and 50% less power over similar incandescent lights whilst providing similar brightness and has a longer lifespan.

BUSINESS EXCELLENCE [ DEC 2018 ]

9

10

[ DEC 2018 ] BUSINESS EXCELLENCE

WESTPORTS

“Westports is located on an island and occupying 535-hectare of land, it is probably the largest organisation on Pulau Indah”

Unlike electricity that is a key input for the port’s operations, water consumption is less but nevertheless too precious to be wasted.

To minimize water pipe leakages and the loss of water, Westports now uses HDPE (High Density Polyethylene) pipe to replace corroded iron pipes at the wharf areas. This lengthened pipes’ lifespan up to 50 years from iron pipes’ typical 15 years while eliminating corrosion and water leakages. Starting in 2014, all iron pipes would gradually be replaced by HDPE type.

Ruben Emir Gnanalingam, the Chief Executive Officer of Westports, shared, “Westports journey into sustainability started before we even became a publicly listed company in October 2013 as we had already obtained the ISO14001 and OHSAS18001 certifications by then. Our top priority of delivering bestin-class level of service remains undiminished even as we incorporate sustainability into the organisation practises. We now view the objectives of achieving record productivity service levels, generating favourable economic returns and also reducing energy and resources consumption – are all mutually compatible and also necessary. With innovation and the adoption of new technologies, this all inclusive perspective is leading us to adopt more green management practices and be able to contribute towards environmental sustainability as well”.

opportunities for more than 4,300 Malaysians.

Over 21 years, Westports has transformed the island’s natural swamp lands and sands into a regional container transhipment and multi-cargo seaport terminal. And today, approximately 40% of Westports’ employees are Pulau Indah residents.

The unique pre-eminent role on the island also created unique opportunities for Westports as CSR initiatives mostly focused on the island itself and its communities.

Westports is now sponsoring all the schools on Pulau Indah under a Trust School Program to improve the quality of students’ learning and teaching effectiveness, thus enhancing overall students’ educational performance.

The sponsorship amounted to RM6 million and improvements have been noticeable with positive feedback received.

Other island-focussed CSR contributions that directly engages with the communities are poverty eradication such as providing financial assistance to the less privileged; refurbishment of community facilities such as schools and mosque; and the provision of medical, safety and security services not only to the port but also to all the island residents

by Westports’ port police.

WESTPORTS

Unique CSR Opportunities On The Island Westports is located on an island and occupying 535-hectare of land, it is probably the largest organisation on Pulau Indah (which means ‘beautiful island’), creating employment

 603 - 6209 0888  info@westportsmalaysia.com www.westportsmalaysia.com

BUSINESS EXCELLENCE [ DEC 2018 ]

11

Westports  603 - 6209 0888  info@westportsmalaysia.com www.westportsmalaysia.com

Produced by: www.bus-ex.com