Port of Tauranga announces 25% drop in first-half profit

12:51 pm on 23 February 2024
Port of Tauranga.

Port of Tauranga. Photo: Supplied / Port of Tauranga

The headline in this story has been corrected to Tauranga and is not Auckland as originally stated.

The country's biggest port has had a 25 percent fall in its first-half profit as cargo volumes dropped markedly and fewer ships visited, knocking its revenue.

Key numbers for the six months ended December compared with a year ago:

  • Net profit $47.2m vs $62.7m
  • Revenue $200m vs $211.9m
  • Cargo vols 11.6m tonnes vs 12.7m tonnes
  • Forecast FY earnings $95m-$107m vs actual $117.1m
  • Interim dividend 6 cents per share vs 6.8 cps

The port's cargo volumes were dented by a 23 percent fall in imports and a 16 percent fall in the number of containers handled.

A rise in the export of logs from the early harvesting of cyclone damaged trees just offset slides in kiwifruit and dairy exports.

But a sharp fall in import volumes was put down variously to a weaker economy denting demand, and the Port of Auckland capturing more business.

Chief executive Leonard Sampson said it had warned last year of a slowdown and the headwinds affecting past six months would likely continue.

"We've seen the impact of a slower domestic economy, and reducing demand affecting import volumes. We've also had issues with reduced coastal shipping, and we have had some significant cost inflation from increased rail costs for moving imports to the Auckland market."

He accepted Port of Auckland had also taken business from it after resolving performance, safety and management problems.

Revenue was also dented by reduced income from the storage of containers now that global shipping schedules had been returning to normal, and the end of the coastal shipping service by Maersk had meant fewer containers being transhipped.

Sampson expected mixed conditions for the remainder of the year, but was also confident in the prospects and opportunities offered by the recently opened Ruakura inland port in Waikato.

"From an import point of view it will be challenging, the domestic economy is on a knife edge, but we expect a stronger export season this year, especially for kiwifruit."

The port has received Environment Court approval for a new container berth at Sulphur Point, but Sampson said the court had ordered more work on some issues, including engagement with tangata whenua, which he expected to take up to the end of the year.

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