KEY POINTS:
Port of Tauranga Ltd has reported an annual net profit up 22.4 per cent to $38 million, despite losing most of the North Island business of shipping giant Maersk Line during the year.
Maersk announced its preference for Auckland over Tauranga in November.
Releasing the annual figures today,
Port of Tauranga chairman John Parker said the result was particularly pleasing given "our half-year uncertainty with Maersk's decision to concentrate its North Island hub on Auckland".
The rise in net profits for the year to June 30 came on revenue up 14.6 per cent to $140.3 million.
Removing gains from non-recurring transactions, normalised operating profit was up 28.6 per cent to $37.1m, the port said.
A final dividend of 14 cents per ordinary share is to be paid, bringing the total for the year to 22c, 10 per cent higher than a year earlier.
Mr Parker said the company's balance sheet was strong with a debt to debt plus equity ratio of 22.7 per cent and an interest cover of five times.
Therefore, a fully imputed special dividend of 10c was also being declared, he said.
Group earnings before interest, tax, depreciation and amortisation (ebitda) were up 14 per cent to $79.8m.
At this early stage, it was difficult to accurately predict trade flows for the coming year, but based on early trading, the company was expecting to continue to deliver year on year earnings growth, Mr Parker said.
Chief executive Mark Cairns said trade for the year was up 3 per cent to 12.647 million tonnes.
Container volumes increased 10 per cent to 466,235 TEUs (20 foot equivalents).
MetroPort, the inland container terminal in South Auckland operated in partnership with Toll Rail, was handling 138,000 TEUs a year -- up 16.4 per cent on the previous year.
"We have experienced a promising recovery in the forestry sector with log exports increasing 5 per cent, sawn timber exports increasing 16 per cent, and paper products increasing 3 per cent," Mr Cairns said.
But dairy exports declined 65,000 tonnes as a result of the Maersk decision to hub on Auckland.
Coal imports were also down 20 per cent to 935,000 tonnes in line with expectations associated with the commissioning of the new gas-fired turbine at Genesis' Huntly electricity plant.
Kiwifruit exports were down 6 per cent, largely due to high onshore fruit losses attributable to a variety of quality issues last season, he said.
The current season export harvest, which straddled two financial years, was expected to increase by 14 million trays, or 18 per cent, from last year's crop.
Mr Cairns said fertiliser base imports were up 28 per cent, along with palm kernel and grain imports -- up 11 per cent on last year.
Oil product imports grew 6 per cent, and the sector was expected to grow further as businesses moved off Wynyard Wharf in Auckland.
Meanwhile, Port of Tauranga said it had bought the Norske Skog facility on Totara St -- a 2ha warehouse on 7.7ha of land and one of the last remaining large blocks of land served by rail close to the port.
Adjoining 17.5ha already owned by the port, the acquisition created a 25.2ha block of port land with direct access to the Mt Maunganui wharves.
"This substantial block of land gives the port greater capacity for growth through the ability to provide opportunities for importers and exporters of bulk products," Mr Cairns said.
A project team had also been investigating the widening and dredging of harbour channels to cater for 5000 to 7000 TEU vessels, expected to be the next class of container ship trading in New Zealand waters.
Mr Parker said third party costs of $1.2m had been incurred evaluating a merger initially proposed by Ports of Auckland.
"It was clear to both the Port of Tauranga and the Ports of Auckland that a merger would provide substantial financial gains, largely in efficiencies, and these gains would have been shared with customers and shareholders.
"There would also be considerable benefits to New Zealand. Naturally we are disappointed that for undisclosed reasons Auckland Regional Holdings have chosen not to proceed," Mr Parker said.
"The issue of port rationalisation will not go away. In a country with a population the size of Melbourne, to have 10 ports vying to be export ports is an expensive extravagance.
"It is expensive in terms of port infrastructure and efficiencies, as well as costing taxpayers excessive sums in roading and port-focused rail links.
"Fewer ports would see fewer trucks on the road, more rail and coastal shipping and less pollution. It is going to happen, but as we have experienced, there will be impediments along the way."
- NZPA
