30 Aug 2012

Port of Tauranga reports record $73m profit

9:05 am on 30 August 2012

Port of Tauranga's full year profit has surged by more than a quarter to a record $73.5 million, boosted by higher cargo volumes.

The profit tops the company's own forecast in February of $69 - $72 million.

Total cargo volumes rose by one fifth, with log volumes up 11%, dairy exports more than doubled and container traffic rose by 35%.

Chief executive Mark Cairns says the company estimates about a third of the additional container volume was as a result of a protracted industrial dispute at Ports of Auckland. Volumes peaked in March at 81% above the previous year's levels.

The port's record profit contrasts with its Auckland rival's loss of $11.9 million.

Although the company benefitted from the Port of Auckland's dispute, Mr Cairns says there has also been an 88% increase in the volume of the trans-shipment business, which business involves transferring containers from one ship to another.

He says that's a key indicator of Tauranga's emergence as a hub for New Zealand.

Mr Cairns declined to give a profit forecast for the year ahead but says there are signs of growth.

Investment plans

The company is to invest over the next three years in exapanding its infrastructure, which it says will secure its position as the country's main international trading hub.

Mr Cairns says the company plans to use more of its 72 hectares of land, and is extending its Sulphur Point wharves as well as increasing capacity at its terminal as part of its infrastructure programme.

He says the company spent $39 million last year and it has a very significant capital expansion programme of $180 million over the next three years.

"So it's really keeping up with that growth and having the port in a position over the next 10 - 20 years that we can cater for our exporters' growth".

The company, which is 55% owned by a local council, will pay a dividend of 27 cents a share compared with 11 cents a year ago.

Meanwhile, Lyttleton Port of Christchurch made an earthquake-adjusted profit after tax of $17 million for the year to June. The result is an increase of 40% on last year.