Ports of Auckland posted a 9.5 per cent increase in first-half profit as the country's third-biggest port slashed its maintenance bill, while warning a reduction in routes will weigh on the company's revenue.

Net profit rose to $31.6 million in the six months ended December 31 from $28.9 million a year earlier, the Auckland-based company said in a statement. Revenue fell 2.3 percent to $106.1 million as container volumes shrank 2.8 percent to 474,613 TEUs (twenty-foot equivalent units), and breakbulk and bulk volumes were down 2.8 per cent to 3 million tonnes.

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The port company's employee bill was largely edged up to $29.3 million, and the company said it started a second round of consultation on plans to partially automate the container terminal, with a decision likely in April this year.

Other operating expenses dropped 22 percent to $24 million as repair and maintenance costs almost halved in the period.


"Container shipping lines have been subject to intense competition in the New Zealand market, with significant over-capacity resulting in unsustainable freight rates," chief executive Tony Gibson said.

"This situation is expected to continue into the second half and beyond and will affect our full-year result."

Ports of Auckland has been building a network across the North Island in a bid to reduce costs for exporters using its supply chain. It completed a series of acquisitions with a $23 million purchase of land north of Hamilton. The company today said it was considering extending its network into the South Island.

The port company declared an interim dividend of $25.9 million, up from $25.5 million a year earlier.

Ports of Auckland also said it plans to sell Onehunga port after shifting Holcim cement handling facilities to Waitemata.