Infrastructure

Raising safety standards in port terminal operations

Over eight years, Macquarie Asset Management helped to raise the safety standards of Ceres Terminals – a leading terminal operator servicing the largest players in the container and cruise markets in North America.

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Sector Infrastructure
Sub-sector Ports
Location North America

Opportunity

In 2015, a Macquarie Asset Management (MAM)-managed fund, Macquarie Infrastructure Partners III (MIP III), acquired a significant minority stake in Ceres Terminals, a stevedoring provider that owned and operated marine container terminals serving cargo vessel operators across North America.

MAM saw an opportunity to transform the business into a long-term port concessions platform. As part of delivering this ambition, MAM supported the business to improve its safety performance through the development of strong governance structures and fostering a culture of continuous safety improvement.

Approach

MIP III acquired the remaining stake in Ceres Terminals in 2019 and increased its efforts in repositioning the company, with an emphasis on enhancing safety measures, driving expansion, and improving the quality and duration of earnings.

Following the transition of MIP III to a 100 per cent owner in Ceres Terminals, MAM supported the implementation of a safety improvement plan which established a Safety Alignment Framework and included hiring a dedicated safety specialist.

Health, Safety, Security, and Environmental (HSSE) Board sub-committees and an incident review committee were also formed to ensure thorough investigations and actionable learnings from any incidents.

To drive safety performance improvements across operations, short-term incentive plans aimed at reducing the Lost Time Injury Frequency Rate (LTIFR)1 were also introduced. This strategic move ensured that the Ceres Terminals leadership team was motivated to implement measures that aligned with benchmarked standards for LTIFR.

MAM further supported Ceres Terminals to engage independent safety consultants to conduct safety audits across all locations. Over a 19-month period, these audits identified several opportunities for safety improvements. These findings helped to refine safety initiatives and priority areas within the safety improvement plan.

During this time MAM was also helping the business evolve its operations to increase the average contract length and secure exclusive contracts with its customers, including concessions with cruise lines.

Outcome

When MAM exited its investment in Ceres Terminals in 2023, the business had generated year-over-year improvements in LTIFR from 2016 through exit in 2023.2

MAM’s investment supported Ceres Terminals' transformation into a leading terminal owner and operator servicing the largest players in the container and cruise markets with significantly enhanced safety metrics.3 This improvement was underpinned by MAM’s extensive safety experience and relationships in the ports sector.

The governance structures implemented, including the HSSE and incident review committees, further embedded a culture of safety and responsibility across the organisation.

Through strategic investments, a commitment to safety, and collaborative efforts with Ceres Terminals’ leadership, MAM played a pivotal role in growing the Ceres Terminals business and redefining its standards of safety, reducing its LTIFR by 72 per cent on exit.4

8-year

investment period

4.3 million

annual container volumes5

13.4 million

annual cruise passengers6

72 per cent

reduction in LTIFR7

Ceres Terminals is an excellent example of how we successfully pursue improvements to the quality, safety and efficiency of operations within our critical infrastructure investments to meet the needs of key stakeholders.”

Karl Kuchel
CEO
Macquarie Infrastructure Partners

  1. Calculated as the number of injuries x 200,000/actual hours worked.
  2. Average annual LTIFR decreased from 5.27 in December 2015 to 1.48 in June 2023. 
  3. Macquarie Asset Management, ‘Macquarie Infrastructure Partners III announces agreement to divest Ceres Terminals’, June 2023.
  4. Average annual LTIFR decreased from 5.27 in December 2015 to 1.48 in June 2023.
  5. As at June 2023.
  6. As at June 2023.
  7. Average annual LTIFR decreased from 5.27 in December 2015 to 1.48 in June 2023. 

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