Rise in containers lifts port's profit

Port of Tauranga has reported net profit up 8.2 per cent to $42.6 million on largely unchanged revenue, with strong growth in container volumes, for the six months to December 31, 2014.

And in an expansion of its relationship with Fonterra-controlled freight and logistics company Kotahi, the port has announced a new joint venture, Coda Group, aimed at creating more efficient internal freight pathways. Coda will combine Kotahi's Dairy Transport Logistics with the port's subsidiary Tapper Transport, its container packing and unpacking facility MetroPack and its 37.5 per cent shareholding in container repair and storage business, MetroBox.

"I see Coda as a really positive development in terms of optimising the supply chain," port chief executive Mark Cairns told the Bay of Plenty Times. "There's a significant amount of empty container moves we think we can take out and ensure the trains and trucks are running full both ways. It's certainly a start to aggregating more cargo across Tauranga and getting ready for the big ships."

Mr Cairns added that the board had approved putting the deep dredging contracts out to tender.

Kotahi chief executive Chris Greenough said Coda was the next step in the preparation for the introduction of larger ships to New Zealand, and addressed the domestic supply chain inefficiencies highlighted in the recently released Ministry of Transport Future Freight Scenarios report.

"These inefficiencies need to be addressed and it will only be through players in the industry working together that sustainable cost savings can be achieved," said Mr Greenough.

The port's board declared a fully imputed six-month dividend of 22 cents per share, up 4.8 per cent on last year's interim dividend. Revenue was $136.3 million, largely unchanged from the $137.1 million in the first half of 2014, with growth in container volumes and dairy and meat exports for the most part off-setting the impact of a drop in log volumes.

Chairman David Pilkington described the result as strong, despite the drop-off in log exports, and said the 2014 alliance with Kotahi was already driving increased freight volumes through the port.

First half export volumes dropped by 5.9 per cent overall to 6.4 million tonnes, largely due to a fall in log export volumes, which were down 17 per cent. However, the port handled 426,512 TEUs, up 11.9 per cent on the prior year, while total cargo volumes increased 1.2 per cent to 10 million tonnes.

Mr Cairns said he expected container volumes to continue to increase in the next six months.