FY 2007 Annual Report
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Connections The Jacksonville Port Authority 2007 Annual Report About this report the size and scope of this report reflect an effort to minimize its impact on the environment. this report is printed on paper containing FsC certified materials which meet the Forest stewardship Council’s standards for responsible forest management, and post consumer recycled fiber manufactured without the use of chlorine chemistry. in addition this paper carries a Green seal certification which ensures that the mill processes used, including packaging, are environmentally friendly. the ink used for this report is vegetable-based. About JAXport the Jacksonville port Authority (JAXport) is an independent agency responsible for the development of public seaport facilities in Jacksonville, Florida. JAXport owns three cargo facilities, one passenger cruise terminal and an auto ferry service along the st. Johns river: the blount island Marine terminal, the talleyrand Marine terminal, the Dames point Marine terminal, the JAXport Cruise terminal and the st. Johns river Ferry. ourVisioN the vision of the Jacksonville port Authority is to be a major economic engine in Northeast Florida by continuing to be a premier diversified port in the southeastern united states, with connections to all major trade lanes throughout the world. our MissioN the mission of the Jacksonville portAuthority is to contribute to the economic growth and vitality of Northeast Florida by fostering and stimulating commerce through the port of Jacksonville. the mission will be accomplished through the effective and fiscally-responsible planning, development, management and marketing of the port's assets and facilities. Cargo Tonnage Tonnage (in metric tons) (in metric tons) Embarking Cruise Passengers Trading Partners (* Inaugural year of cruise service) CONNECTIONS: Cargo, Cruise, Community As this annual report reflects, JAXPORT is busy creating connections: establishing new routes for sea-going commerce; continuing to fulfill our important role in the cargo supply chain; exceeding customer expectations with our award-winning cruise embarkation service; and staying true to our main mission of providing jobs and opportunity for the Northeast Florida community. Chief among these connections is JAXPORT’s extraordinary access to three interstate highways and three major railroads leading to and from the U.S. heartland and beyond. Cargo imported through JAXPORT is now distributed to every U.S. state except Hawaii. With the expansion of the Panama Canal underway, JAXPORT stands to see unprecedented growth in the next decade thanks to our unique geographic location. We are getting ready to seize this opportunity now. JAXPORT’s newest connection with Asia and Europe, the TraPac Container Terminal at Dames Point, moves closer to completion every day. Construction of the $220 million dedicated terminal for Mitsui O.S.K. Lines, Ltd. (MOL) is well underway and TraPac is set to begin operations at the end of 2008. MOL’s commitment to JAXPORT has spurred other Asian carriers to take a closer look at Jacksonville’s strategic possibilities for their cargo. Again, opportunity is knocking and JAXPORT is making the connections. In JAXPORT’s fourth year of offering cruise service, passengers came from every U.S. state and beyond (Canada and the U.K.) to enjoy a trip aboard the Carnival Celebration. JAXPORT’s Cruise Terminal award-winning embarkation team continues to connect with customers and with Carnival Cruise Lines itself: the cruise giant recently announced plans to homeport a newer, larger vessel here in the fall of 2008. In addition, we remain connected to the beautiful St. Johns River, without which our efforts to be a true economic powerhouse for the region would surely flounder. JAXPORT is committed to balancing the needs of seagoing commerce with the environmental stewardship of this glorious natural resource. In FY 2007, JAXPORT earned nearly $40 million in operating revenues, the seventh consecutive year of record revenues. At the same time, JAXPORT’s operating expenses decreased and operating income grew, all further illustrating the financial health of the JAXPORT organization. Wall Street has shown its recognition of this strength, with two of the nation’s premier rating services recently reaffirming strong financial grades for JAXPORT. As you will see in the pages of this report, JAXPORT’s connections to cargo, cruise, community and global commerce will long continue to reap benefits for our stakeholders and for the people who live and work in Northeast Florida. Tony D. Nelson Frederick R. Ferrin 2007 Chairman Executive Director of the Board Financial Health JAXPORT earned $39.9 million in operating revenues in FY 2007, a four percent increase over FY 2006 ($38.5 million) and the port’s seventh consecutive year of record revenues. Operating expenses decreased to $25 million, down from $28 million the previous year. Operating income grew to $14.5 million, up 38 percent from $10.5 million in FY 2006. These financial results reflect JAXPORT’s solid year operationally. Total cargo shipped through JAXPORT facilities decreased slightly to 8,309,201 tons in FY 2007, a four percent decrease from last year’s record 8,696,543 tons. A total of 129,838 passengers embarked on cruise ships departing the JAXPORT Cruise Terminal, up slightly from the 128,463 embarkations in 2006. In 2007, Moody’s Investors Service assigned JAXPORT a financial rating of “A2” while Fitch Ratings assigned JAXPORT a rating of “A.” Both agencies noted JAXPORT’s competitive position as a container port, its status as one of the nation’s largest vehicle processing centers, and its diverse revenue streams supported by long-term contracts with private tenants. JAXPORT’s current major capital construction project is a new cargo facility now being built in Northeast Jacksonville for Mitsui O.S.K. Lines, Ltd. and the company’s terminal operating arm, TraPac. In addition, JAXPORT has budgeted approximately $172 million for other capital projects in FY 2008 to include the potential acquisition of property for further terminal development. Fort Caroline Elementary School students took home small plants to nurture following a JAXPORT sponsored tree planting ceremony to beautify the school grounds. The children came away understanding the role of trees and plants in a healthy environment. Our busy Talleyrand Marine Terminal contributes to JAXPORT's positive impact on the economic vitality of the entire Northeast Florida region, handling containerized and breakbulk cargoes, imported automobiles and liquid bulk commodities. Connecting with the Economy There is no denying that JAXPORT is a crucial component of the area’s present economic vitality and future growth. According to figures compiled by the Pennsylvania-based consulting firm Martin Associates, Jacksonville’s seaport generates the following impact for Northeast Florida: • Nearly 50,000 direct and indirect area jobs, everything from longshoremen, truck drivers and warehouse workers to engineering specialists, legal consultants, maintenance workers and hundreds of similar support positions. Approximately 7,000 of these positions are held by employees of private firms operating directly at port terminals. An additional 43,000 jobs are held by area workers throughout Northeast Florida who support those directly employed at port facilities. • Almost $3 billion in economic impact annually for Northeast Florida. This includes $1.3 billion of personal wages paid by port- related companies and re-spending by workers; $743 million in business revenue generated by port-related companies; $258 million generated in U.S. Customs revenue; $239 million in local purchases made by port-related businesses; and $119 million paid in state and local taxes by port businesses. A separate economic impact study shows that the cruise industry supports more than 400 jobs in Northeast Florida and more than $40 million in annual economic impact. Jobs at the JAXPORT Cruise Terminal include those handling luggage, customer service, parking and security, as well as jobs generated in the community to support passengers and crew members, such as ground transportation and hospitality. In addition, the construction of the TraPac Container Terminal at Dames Point has spurred demand for commercial real estate and warehouse space. Citing Jacksonville’s outstanding intermodal connections and worldwide ocean carrier services, several companies are building and opening new warehousing and distribution center facilities in Jacksonville. Cargo Highlights In FY 2007, JAXPORT facilities handled 8,309,201 tons of cargo, a four percent decrease from the FY 2006 8,696,543 tons. This small decrease comes after three straight years of record cargo tonnage and six consecutive years of cargo growth. JAXPORT remains the nation’s second busiest vehicle handling port and 12th busiest container port. JAXPORT experienced gains in two of its four cargo types in 2007: the shipment of vehicles and other Ro/Ro cargoes – primarily passenger cars, trucks and heavy equipment – grew by 4 percent, with 614,647 units moving through JAXPORT. Bulk cargoes – including crushed limestone and other aggregates – grew to 2.3 million tons, reflecting a two percent increase. Breakbulk cargoes – which include lumber, paper, steel, poultry and other non-containerized commodities – fell four percent to 1.2 million tons. Meanwhile, containerized cargoes – primarily consumer goods – fell 11 percent to 3.6 million tons, or 710,073 container units (measured in 20-foot equivalent