Shows a profit its first in 3 years

TIDE TURNING AT THE PORT MPA

February 05, 1992|By Liz Atwood

Thanks to drastic cuts in expenses and a small increase in revenue during the first half of its fiscal year, the Maryland Port Administration has pulled itself out of the red to post its first profit in three years.

But cargo figures released yesterday showed that despite signs of a turnaround, Maryland's public terminals continued to lose ground to Virginia ports and have a long way to go to regain the business they have lost in the past three years.

In 1991, 5.15 million tons of cargo passed through the port, up 0.4 percent from 5.13 million tons in 1990, a year so dismal that the port administrator at the time, Brendan W. "Bud" O'Malley, called it "a year to be forgotten."

Port officials sought yesterday to put a positive light on the figures.

"Although the total increase certainly was not overwhelming, the fact that we were able to show any upturn in this recessionary economy is significant," said Adrian Teel, executive director of the MPA. "We've righted the ship."

Mr. Teel had promised to have the port operating profitably in the fiscal year that will end June 30, 1993, but his goal apparently has been reached early, with a $368,000 profit during the first half of this fiscal year.

After the MPA posted a $2.8 million deficit in the last fiscal year, Mr. Teel started severe cost-containment measures, including a 15 percent reduction in the work force.

"We believe we have turned the corner financially," said Mr. Teel, who took over at the port last June.

The fiscal 1993 budget projections call for a profit of $779,000.

Cargo tonnage fell 11 percent in 1990, partly because of the recession, two strikes and the loss of three cargo lines. In 1989, the MPA also reported a bad year, in large part because of a prolonged dispute with longshoremen over jobs at the port's dockside rail yard, which opened in the fall of 1988.

At its peak in 1980, 6.1 million tons of general cargo passed through the port. General cargo includes containers, autos, heavy equipment, machinery and boats, but does not include oil, coal or grain.

Mr. Teel said that despite successes in wooing new lines to the port and securing long-term agreements from some important customers, cargo volume remained virtually unchanged because of the recession and the loss of Hapag-Lloyd AG, one of the port's largest lines.

The biggest increase in tonnage was in steel, which was up 53.4 percent, to 237,519 tons from 154,837 tons. Farm and construction equipment was up 6.8 percent, and automobile tonnage increased 3.6 percent. The increase in cargo tonnage LTC resulted mainly from a 15 percent increase in exports, to 2.7 million tons in 1991.

William F. Treacy, chief economist with MNC Financial Inc., said exports remained strong in 1991 because of growing markets in Germany and Japan, and because the weak dollar made U.S. products less expensive and thus more attractive to overseas customers.

The figures released yesterday also showed that the $250 million Seagirt Marine Terminal is starting to attract business to the port. In 1991, its first full year of operation, 1.1 million tons passed through the container-cargo handling facility.

Mr. Teel has had little success in wooing business away from the ports' archrival Virginia ports. Those ports handled a record 7.6 million tons of general cargo in 1991, 6 percent more than in the previous year. It was the ninth consecutive year of improvement for the Virginia ports.

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