P&O Port Business Is Strong

Peninsular & Oriental Steam Navigation Company Plc (P&O) said its ports business remained robust during the second quarter despite slower growth in world trade. But analysts said P&O's trading update confirmed its ports division's 10 percent internal growth for the quarter on a year ago was still below the company's target annual rate of 16 percent growth for the 12 months to December 31, 2001. P&O's ferries business found conditions tough in the quarter, raising the prospect that some analysts might trim full-year earnings forecasts on the back of less-than-expected ports growth and deteriorating ferries and container markets. "The ports business is showing some robust growth as they would say, but it's undoubtedly slowing and it's below their targets," UBS Warburg analyst Raymond Maguire told Reuters. "Ferry (business) continues to deteriorate and they are losing market share and the major concern for the interim financial results in September is the deteriorating container market," Maguire said. He said the risk for earnings was on the downside, but he put a floor for the share price at about book value of 230 pence. According to Multex Global Estimates, the median of analysts' full year pre-tax profits forecasts is $342 million. UBS Warburg has pegged its P&O pre-tax profits forecast at about 235 million pounds. - (Reuters)