As much as 50 per cent of revenue rides on Monday's outcome of legal battle The $6.5 billion River Trade Terminal (RTT) could turn its first profit within three years if operating costs are cut and it is allowed to continue to serve vessels that deliver goods from south China's prolific factories to Asian markets, according to its top executive. The company on Monday will reach the final leg of its two-year legal battle with the government over its right to serve ocean-going vessels, a valuable and growing source of revenue for the firm. Its new general manager, Paul Wong Hok-leung, yesterday said that win or lose, the RTT's business model would change to be more in line with the low-margin business it is in and the low overheads of its rivals. 'One of my key goals is a substantial re-engineering, in simple terms substantial cost reduction,' Mr Wong said. 'But there's no doubt having the right to handle vessels from the intra-Asia trades would help me build a hub quicker, and turn around the company.' The government insists the provisions of the RTT's nine-year-old land grant restrict it to handling cargo shipped to and from the Pearl River Delta. It moved about 2.6 million boxes of cargo across its 49 berths last year, 900,000 of which were from the type of ocean-going vessels the government says is in contravention of the RTT lease. As its tariffs for handling intra-Asia cargo are on average double those for the river trade, as much as 50 per cent of RTT's annual revenue may rest on the two-day trial at the Court of Final Appeal. 'On Monday, if the court says I cannot [handle intra-Asia vessels], I will stick to my job, positive that we can still operate on a break-even basis,' Mr Wong said. 'If I am allowed to do a small volume [of intra-Asia trade] - one million teu [20-ft equivalent boxes] - within 30 months, the RTT will turn a profit.' Mr Wong declined to reveal how much money the RTT lost last year, saying it was 'more than many, many millions'. Shareholder provisions in 2002 and 2003 annual reports indicate the company lost at least $450 million in those years. Part of the problem, he said, was the fragmented nature of the river trade business made it difficult to market the RTT, which he said was the best facility of its kind in Asia. 'Because of the dispute, the RTT's marketing efforts have been undermined,' he said. 'The quickest way to turn the RTT into a hub for river trade is to target the intra-Asia vessels plying it. 'If I can market from that angle, it would be a far more effective way to create a hub [for the river trade]. It is the right way.' While the RTT has increased the amount of cargo it handles every year since its 1998 launch, it has largely failed to live up to its original billing when it was awarded to a RTT consortium which included Hutchison, Sun Hung Kai, Jardine Matheson, Cosco Pacific and the Bank of China (International). Tired of the endless cash calls, Cosco and the BOC sold their 10 per cent stakes in the past two years. Many industry watchers are beginning to see the RTT as a lost opportunity for Hong Kong, with ports across the border increasingly turning their attention to the promising river trade. The 10 billion yuan new international port at Nansha is one of several south China facilities looking to the river for additional revenue. 'Hong Kong is at the southern tip of the Pearl River Delta, Nansha is almost the geographical centre,' Mr Wong said. 'If the RTT does not attract the critical mass it needs to become a river trade hub in three years, we are in serious trouble.'