Sailing to glory
A change of direction appeared imminent after Portico (formerly named MMD Shipping Services) had struggled for a decade to get to grips with the changing reality in the shipping industry. The company, which has been active in Portsmouth since the 1980s and was bought by Portsmouth City Council in 2008, was mainly known for being a fruit business, importing bananas and season fruits, but over the past two years, it has worked hard to transform itself into a multimillion cargo handling operation.
The appointment of Mike Sellers as Port Director of Portsmouth International Port and as such, a Board Director for Portico, in January 2017 signalled the shift in the company’s focus. “From the start, I could see lots of opportunities, but we had to change our business plan,” Mike remembers. “There was no long-term strategy or vision for the future whatsoever and we were at a loss of how to adapt to the new market conditions and make the most of the warehousing and stevedoring opportunities that were available.”
For Mike and his senior management team, the remedy was diversification. Being a 100 per cent fruit business had rendered Portico a bit clumsy, so more flexibility in its market offering was to be introduced. Mike comments: “About 12 months ago, we started putting together our business plan. It had to be devised very carefully, because we were a company that had not made a profit in the previous ten years, so we had to prove to the Council that our strategy going forward was sustainable and one that was going to bring return on investment. Understandably, the Council employed the services of consultants who were to assess our plan and, to our satisfaction, it was deemed the best option for the development of the site.”
Following the approval of Portico’s strategy, the company received a financial injection of £15 million over the next ten years in February 2019, also rebranding to take its current name. “The word ‘portico’ has a Greek origin and represents a structure consisting of a roof supported by columns at regular intervals, typically attached as a porch to a building. We found this name to accurately reflect our ambition of being a business that supports Portsmouth’s international trade,” Mike enthuses.
“With the £15 million investment, we are hoping to modernise the port and make it more efficient when it comes to delivering the new types of service we aspire to develop in the coming years,” he continues. “For example, we will demolish a warehouse at Flathouse Quay and build a new, modern cold storage facility in its place with a capacity of 6000 pallets. In addition, we are in the process of demolishing two warehouses at Albert Johnson Quay, as we are looking to enhance our container storage. At the same time, we are making sure that we will increase our pallet storage by over a quarter for our fresh produce business, but this will be positioned further away from the quays, rendering the site’s overall layout a lot more relevant to our current objectives.”
A central theme of Portico’s business plan is the formation of long-term agreements with various operators. With the company remodelling the space it has at its disposal, it is now going to take advantage of its storage and cranage facilities for containers and project cargoes. The first success of this optimisation has been the winning of a contract from MHI Vestas – a Danish-based international manufacturer of wind turbine blades. Marking a striking change in the type of cargo Portico usually handles, the ten-year deal will see the company store and load MHI Vestas’ 82-metre-long blades in its facility, getting involved in the offshore wind farm supply chain for the first time in the business’ history.
“It is exciting to play a role in the offshore industry, with the launch of the new joint government-industry Offshore Wind Sector Deal opening up a host of opportunities for us,” Mike notes. “A third of British electricity is now set to be produced by offshore wind power by 2030, which strengthens the type of business companies like MHI Vestas are involved in, which, in turn, is good news for us and for the city of Portsmouth, as a whole.”
Portsmouth International Port holds the reputation for UK’s best-connected ferry port for a reason. Located just a minute away from the motorway and providing easy access to most routes to France, Spain, and the Channel Islands, its connectivity has created numerous possibilities for local businesses. It is not a surprise, then, that Ferryspeed approached Portico, entrusting the latter with the containers’ lift-on and lift-off on its Channel Islands line. Not neglecting the fresh produce side of the business, Portico has also recently won a contract with international fruit importer Seatrade.
“All these relationships we have been establishing, demonstrate very clearly that our efforts to diversify our activities are already paying off. We are willing to be a true multi-user facility that can handle various types of cargoes and it is pleasing to see the amount of project cargo business we have generated as of late. Previously, these companies would not have even considered Portsmouth as an option, because they thought we were just operating in the fruit business, but this perception is definitely changing,” Mike discusses.
“According to our business plan, we should be a profitable business by 2021 and we are on track to achieving this goal. The plan itself maps out our aspirations for the next 20 years, so it is a long-term vision we are trying to execute. Speaking of our medium-term future, in the next five years, we want to reach a point where we are generating enough of a profit that will enable us to start investing in the business ourselves, rather than just borrowing money and taking loans from Portsmouth City Council.
“Last but not least, we want to grow in a sustainable manner, respecting the environment, and investing in clean- energy machinery. Last year, we purchased electric forklifts for the sum of £1.5 million, and we are currently looking at purchasing zero emission tugmasters, rather than diesel tugboats, thus making our contribution to a cleaner future,” Mike concludes
Provides a range of cargo handling and stevedore services
Secured a £15 million investment for the next ten years
Has recently won several new contracts that will help it diversify the business