MARITIME services provider Harbor Star Shipping Services, Inc. said on Wednesday it plans to spend about $8 million to expand its domestic and international operations.
“In the Philippines we’re almost everywhere already, but we still continue to expand in the domestic market—like we’re opening in Iloilo this year. The tug is coming in July, so [by then], we will start [operations]already,” Harbor Star President Geronimo Bella told reporters on the sidelines of the company’s annual stockholders’ meeting.
Likewise, the company is looking to expand its services north of Manila such as in the Ports of Subic and La Union.
Four tug boats are set to be purchased, which will cost about P8 million to P10 million depending on the age, the company said.
“But we’re trying to keep the costs low,” Bella said.
On the international front, the company is looking for more opportunities to set its footprint in Malaysia, Indonesia and Myanmar.
“We’re in talks with the port authority of Myanmar, a company in Indonesia, and also in Malaysia we’re talking to one power plant who wishes to charter four to six tugs. They are coming here, I think next week, to do some inspection on our tugs,” Bella said.
Part of the company’s capital expenditure for the regional expansion will be sourced from its planned P1 billion follow-on offering in the fourth quarter of this year. The details, however, have yet to be finalized.
The rest of the funding requirement will be sourced from bank loans.
“Part of that P1 billion will also be used for the regional expansion–we’re looking at about P300 million to P400 million,” Bella said.
Harbor Star recently entered into a three-year lighterage service contract with Palau Sea and Air Transport Agency to provide exclusive logistics in transporting construction equipment and materials from the Philippines to Palau, Micronesia and the Marshall Islands. The first shipment is scheduled at the end of May 2017.
“[The lighterage service contract] will result in an additional eight voyages per year for our international tug and barge tandems,” Bella said.
“I am confident that our company has the building blocks needed to continue our growth. We constantly push ourselves to fortify our reputation as a stable and reliable marine services provider,” he added.
Harbor Star is a provider of maritime services including lighterage, towing, salvage, marine repair and maintenance works, as well as commerce and navigation in the carriage of goods and passengers, and international manning, recruitment, contracting and ship and crew management for all types of vessels.