Westports Holdings Bhd posted a set of impressive results for its latest quarter, shrugging off the impact of the Middle East conflict with a combination of port tariff hikes and administrative cost reductions.
The port operator’s net profit for its second quarter ended June 30 (Q2 FY2026) jumped 56% to RM360.9 million from RM231.63 million a year ago while revenue rose 25% to RM866.89 million.
For the first half (H1) of FY2026, its net profit increased by 51% to RM687.4 million from RM454.09 million a year earlier while revenue rose 34% to RM1.76 billion, according to its bourse filing yesterday.
Container volume fell 1% in H1 to 5.51 million twenty-foot equivalent units (TEUs) while fuel cost, which accounts for about 21% of its total direct expenses, surged about 40% from a year earlier.
Most research houses kept their “buy”” calls on Westports as its results beat expectations despite the elevated fuel costs triggered by the US-Israel attacks on Iran in late February.
RHB Research said Westports’s H1 results “surprised on the upside” despite the full impact of the Middle East conflict.
“Stronger-than-expected tariffs more than offset the surge in fuel costs and softer throughput from the Middle East.
“We remain constructive on the stock despite the recent share price rally, riding on encouraging macro data as we expect a stronger second half,” it said in a note today.
RHB reaffirmed its “buy” call and raised its target price (TP) to RM8.20 from RM7.49 previously.
The research house noted that yard density remains healthy at 80% in July, with two new container yards expected to contribute an additional 500,000 TEUs capacity per year.
The Westports 2 expansion remains on track, with the first 300m wharf at container terminal 10 scheduled to commence operations by Q3 2028, it added.
Westports recorded 11.3 million TEUs in container throughput in 2025, surpassing the previous record set in 2024.
Hong Leong Investment Bank noted the group’s first half earnings growth was primarily driven by the 10% tariff hike in January 2026 and 15% hike in July 2025.
“We continue to expect sustained earnings growth, supported by resilient container volumes and a further 5% tariff hike scheduled to take effect on Jan 1, 2027,” it added.
The bank maintained its “buy” call and kept its TP unchanged at RM7.15.
Maybank Investment Bank said Westports’s outperformance was “likely driven by the recent tariff hike and higher value-added services, which more than offset cost inflation”.
It maintained its “buy” recommendation and raised its TP to RM7.66.
At the time of writing, Westports’s shares were six sen or 0.9% higher at RM6.75, giving it a market capitalisation of RM23.2 billion. The stock is up 19% year to date.
