Challenges for the Global Port Industry

Enno KOLL Head of Latin America – PSA

World’s largest port group

64.1 million TEUs in 2015

World’s single largest container terminal

30,000 staff globally

Group revenue of USD$2.7b in 2015

based on equity-weighted throughput

(declared Group throughput)

in Singapore: 30.6 million TEUs in 2015

with over 20,000 direct employs

Who is PSA ?

Over 40 terminals in Asia, Europe, AmericasOf which 32 are Joint Ventures

Buenos AiresARGENTINA

PanamaPANAMÁ

Americas

BuenaventuraCOLOMBIA

Vung TauVIETNAM

SingaporeSINGAPORE

LaemChabang

THAILAND

Southeast Asia

JakartaINDONESIA

IncheonSOUTH

KOREA

KitakyushuJAPAN

BusanSOUTH

KOREA

FuzhouCHINA

TianjinCHINA

GuangzhouCHINA

DalianCHINA

DongguanCHINA

LianyungangCHINA

Northeast Asia

QinzhouCHINA

ZeebruggeBELGIUM

SinesPORTUGAL

AntwerpBELGIUM

GenoaITALY

VeneciaITALY

MersinTURKEY

Europe & Mediterranean

TuticorinINDIA

ChennaiINDIA

KolkataINDIA

DammamSAUDI ARABIA

MumbaiINDIA

KakinadaINDIA

Middle EastSouth Asia

MarielCuba

Buenaventura, Colombia

SPIA

Opening in Q4 2016

Ready for 18k TEU ships

Rodman Pacific, Panama

PSA Panama Int. Terminal

2m TEU capacity H2 2017

Hub of the Pacific

Mariel, Cuba

TCM

40% growth in 2015

800,000TEU capacity

Buenos Aires, Argentina

Exolgan

1.1m TEU capacity

Handling 10k TEU ships

PSA in Latin America

Challenges for the Shipping Industry

• Our market is growing slower

• Global GDP is slowing down, Latin America is shrinking in 2016

• GDP/ TEU multiplier has fallen below 1

• Transshipment index decreases

• Our customers are in trouble

• Larger ships = lower slot cost ? = need to fill them

• Cascading effect into all trades

• Team up, consolidate or …

Challenges for Global Port Operators

• Higher cost per TEU of new capacity installed

• Higher CAPEX specifications

• More capacity needed to cope with peaks

• More players chasing fewer interesting new projects

• New entrants into terminal market

• Few attractive greenfields, more M&A

• Lower margins and higher risks

• Revenues under pressure

• Entire ports at risk => global portfolio management

How do we respond ?

• Future proofing our assets

• Forming the right alliancesPortfolio

• PSA Franchise - superior standards for customers

• Securing the hinterlandProduct

• Applying technology for efficiency

• Embracing changeProcess

Future proofing our assets: Example Antwerp

Future proofing our assets: Example Singapore

• Building out the Pasir Panjang to 15m TEU

• Preparing the 65m TEU future to stay relevant

How do we respond ?

Portfolio

Product

Process

• Future proofing our assets

• Forming the right alliances

• PSA Franchise - superior standards for customers

• Securing the hinterland

• Applying technology for efficiency

• Embracing change

Pacific

Coast

Atlantic Coast

MIT, CCT, PPC

PPC

PSA

-

• Trucking to Atlantic Coast and Colon

• Integrated into customer service offer

• Control of prices, quality, destinations

• A better product than the train

Securing the hinterland: Example Panama

How do we respond ?

Portfolio

Product

Process

• Future proofing our assets

• Forming the right alliances

• PSA Franchise - superior standards for customers

• Securing the hinterland

• Applying technology for efficiency

• Embracing change

Applying technology: Example Singapore - 25 sec gate

and 8000 trucks per day

Average traffic flow of 700 trucks per peak hour

Applying Technology in different areas of the terminal

Automated Guided Vehicles

Embracing change

Millenials 50% of

today’s

jobs obsolete ?

The smell

of the place

Our people

Uber-

ization

Internet

of things

Augmented

reality

Digital

Technology

Big data

analytics / AI

How do we respond ?

Portfolio

Product

Process

• Future proofing our assets

• Forming the right alliances

• PSA Franchise - superior standards for customers

• Securing the hinterland

• Applying technology for efficiency

• Embracing change

Thank you !

18

PANAMA

19

• Berth: 340 m, 14.5 m draft

• Terminal area: 22.5 ha (14 ha developed)

• Equipment: 3 QC, 9 RTG

• Container yard: 1,410 TEU ground slots,

360 reefer plugs

• Avg. GCR: 32+ mph

Time to Miraflores locks: 15 min at entrance to new locks; 30 min from anchorage.

Transshipment hub to South America’s west coast and canal transits

Transshipment to Atlantic by truck

ONE OF LATIN AMERICA’S MOST

PRODUCTIVE TERMINALS

20

GETTING PANAMA READY FOR THE FUTURE

Groundbreaking May 2015

PHASE 2 EXPANSION PROJECT

Progress:

• Advanced Earthworks completed

• Dredging and quay – completion in

2017

• 8 new quay cranes & 12 yard cranes:

delivery 2017

Future quay deckalignment (800m)

Area to be excavated

Area to be dredged

Futurecontainer yard

Excavationworks

Phase 1

PHASE 2 EXPANSION PROGRESS

COLOMBIA

POISED TO BE BEST-IN-CLASS CONTAINER TERMINAL IN BUENAVENTURA

• 4 x 23row QC

• Dedicated, secure and uncongested access road

• 8000m2 warehouse space and space for logistics

• Phase 1:

650,000 TEU

• Future

expansion to

965,000TEU

• Terminal

Opening Q3

2016

Closest port to Bogotá, Medellín, Cali

• 70% of GDP and 50% of the country´s foreign

trade

• 60% of the population

• Main production and consumption centers, as well

as coffee and sugar regions

BUENAVENTURA: GATEWAY TO

COLOMBIA’S GDP

1M TEU LOCAL CARGO

Distance

in kmBuenaventura Cartagena

Santa

Marta

Bogotá 512 1,060 904

Medellín 475 613 807

Cali 165 1,012 1,206

Pereira 263 814 1,008

BUENAVENTURA TERMINALS

• Best access => Vessels up to 18.000 TEU

and 400m length

• 600m berth x 14.5m depth

• Uncongested, secure access road

• Ample land for development

SPR Bun• Inside congested city• Only 2x22 row cranes• 350m of deep draft

APMT• 380m berth • ≈ 300m restricted

maneuvering basin

Pacific

Ocean

Buenaventura

Bay

Access

Channel

700m 300m

SPIA

• Navy & Coast Guard Base

PENINSULA 2013

PENNINSULA 2016

APRIL

2013APRIL

2014

ROAD

QUAY

FEB

2015

JULY

2015

TODAY

TODAY

PROGRESS 2013-2016

SEPTEMBER 2016

SEPTEMBER 2016

Inspection

Building

RTG’s

Reefers

Laden

stacks

Laden

stacks

Berth

access

Gate

CUBA

2013-2016

40% GROWTH TO 330K TEUs

High standards for

efficiency and

service

2016 forecast: 360k

TEUs

Channel Dredging:

For Panamax ready

July 2016

Ideally located for US

Gulf transshipment

MARIEL SPECIAL ECONOMIC

DEVELOPMENT ZONE

New or restored railways

New four-lane highway providing

access to Mariel

Total area available for development in

the context of ZEDM

“Special Development Zone of Mariel” (ZEDM)

has been created to promote, develop and to

manage 465.4 km2 of land for the economic

development in this region.

- Cuba's economy is growing rapidly

(imports grew by 35% in 2015 and

20% so far in 2016)

- Mariel Special Development Zone

under construction (new industries,

job creation, re-exports, etc.)

- US-Cuba relations are working

towards normalization

- Tourism growing at 20% annually.

Logistics

Zone

Industrial

Development

Access Channel Works

July 2016: Panamax

2017: Neo-Panamax

LOCATION IN MARIEL BAY

35

Phase 1

800,000 TEU capacity

700m berth, 4 QC

28Ha, 1,140 plugs

Future Expansion

3m TEU capacity

2,400m berth, 24 QC

95Ha, 2,500 plugs

Ideal location for US Gulf

transshipmentHUB LOCATION

- Deep draft and infrastructure

- Congestion free;

- Best timing and reliability;

- Connection with other main

routes;

- 11m local population

SavannahTampa

MobileNew Orleans

Houston

Progreso

Kingston Caucedo

MiamiBahamas

Long Beach/ LA

Port Everglades

Cartagena

Panama

Chicago

Charleston

Oakland

Tacoma

Veracruz

Altamira

Tuxpan

New York

Norfolk

Mariel

2 days,

13 hrs.

-Deep draft and infrastructure

-Congestion free;

-Best timing and reliability;

-Connection with other main

routes;

-11m local population

ARGENTINA

ARGENTINA

BEST LOCATION IN

BUENOS AIRES

8km

LARGEST TERMINAL IN

ARGENTINA

Container Yard

36Ha – 27,500 Teus capacity (static)

Pre Gate

Parking area

2.2 Ha

Empty Container depot

8,300 Teus capacity (static)

Main featuresBerths: 3 berths (2 Post Panamax; 1 Panamax) 1,150 meters

Reefer plugs: 1,200

Draft: 1 berth with 12.3m & 2 berths with 10m

Quay cranes: 7 (1 x 21 rows + 2 x 20 + 2 x 19 + 2 x 17) + 3 x 13rows

444 mts

39

Co

nta

iner

Su

pp

ply

Ch

ain • Port Operations

• Container Freight Station (CFS)

• Multimodal transportation

• Trucking

• 3PL Logistic services

• Distribution

• World Class Warehouse lease

EXOLGAN can offer complete logistics packages (port services + 3PL)

to the cargo jointly with its Shipping Lines clients.

ADDED VALUE THROUGH

SUPPLY CHAIN

2016

2008

2012

Expansion Empty

Area

PNA Offices

Fuel Station

Expansion Car Park

New alignment

lightning

New Access Road

New Lighting Poles

1.5-hectare full ctn. Yard

Relocation of the Sand Companies

Expansion South

Channel

Reefers Racks

4-hectare full ctn.

Yard

New Gate-In

M&R Warehouse

M&R Expansion

Internal Truck

Parking

New Infirmary

Relocation of Houses

2009

2010

3 New Reefer Full Racks

Relocation of Sand Companies

Improvement of existing pavement

New Berth 3 (360 mts)

Turning Basin Expansion project

26 Yard Tractors

TOS Navis N4

Cy Yard Expansion ( 5 Ha)

VGM Ready by June 2016

16 New yard tractor

E seals

TERMINAL ENHANCEMENT PLAN

(2008-2016)

CURRENT STATUS

830K Teu Capacity

7 Super Post Panamax QC available

Two 10K Teu Vessels simultaneous

operations

10K Teus Vessel Productivity: +120 bmph

38,000 Teus monthly throughput vs 58,000

in 2013 (55% CY capacity)

• Berth & equipment to operate two mega

vessels simultaneously and berth-on-

arrival with superior regional vessel

productivity (+120 mph)

• Culture of cooperation and customer

service

• Superior location – further enhanced

with new off dock area

• Continued expansion to capacity of ca

2.5 M TEU capacity with 4 berths

• Added value services through our

logistics and warehousing companies

EXOLGAN IN 2016

43

25 Ha

Main Highway

Exolgan

New Area: 25 Hectares

- 2 Km from Exolgan - MT Storage (10 Ha)

- Direct Access to Main Highway - CFS & Logistics Activities (7 Ha)

- Import / Export Truck Parking) (8 Ha)