Announcement
HALFYR: POT: POT Improves Performance as Covid Disruption Continues
08:30am
POT
25/02/2022 08:30
HALFYR
PRICE SENSITIVE
REL: 0830 HRS Port of Tauranga Limited
HALFYR: POT: POT Improves Performance as Covid Disruption Continues
Port of Tauranga Limited (NZX:POT) today reported an increase in profits for
the first six months of the 2022 financial year as it deals with ongoing
cargo volume volatility.
Group Net Profit After Tax for the six months to December 2021 was $56.3
million, a 15.6% increase on the same period the previous year, as cargo
volumes remained steady at 13.0 million tonnes. Container numbers increased
1.5% in volume to 622,271 TEUs .
Highlights and Challenges
For the six months to 31 December 2021:
o Group Net Profit After Tax increased 15.6% to $56.3 million
o Total trade remained steady, decreasing by just under 0.3%
o Imports increased 2.7% to 5.0 million tonnes
o Exports decreased 2.0% to 8.0 million tonnes
o Container volumes increased 1.5% to 622,271 TEUs
o Transhipped containers decreased 21.4% to 143,339 TEUs
o Subsidiary and Associate Company earnings decreased 11.2%
o Log exports decreased 6.1% to nearly 3.1 million tonnes
o Direct dairy exports increased 2.3%
o Direct kiwifruit exports increased 16.0%
o Interim dividend of 6.5 cents per share, an 8.3% increase on the same
period last year.
Port of Tauranga Chair, David Pilkington, said the mid-year financial results
reflected the resilience offered by the Port's diverse portfolio of cargoes
and varied income streams, as well as changes to container mix.
"We are still experiencing disruption across the supply chain and this will
be exacerbated by the Omicron outbreak," said Mr. Pilkington.
"With the support of our service providers and business partners, we have
managed to keep congestion to a minimum and keep cargo moving through this
challenging period."
"Unreliable shipping schedules, constrained capacity in the system and labour
shortages continue to be commonplace."
Mr. Pilkington said the current supply chain challenges made it even more
important to build future resilience for New Zealand. Port of Tauranga has
applied for resource consent to increase capacity by extending its container
berths to the south of the existing wharves.
Detailed planning and consultation for the project began in 2019. It was
disappointing that the project was declined for the Government's shovel-ready
and fast-track resource consent programmes in 2020 and 2021 respectively,
despite no funding being sought from Government. Subsequently, we have
sought direct referral to the Environment Court. The case is now waiting for
a court date.
Mr. Pilkington said the glacial pace of the regulatory process was extremely
frustrating.
"The Resource Management Act processes fail to recognise the critical nature
of this infrastructure project and the Government's unwillingness to expedite
the resource consent is very disappointing," he said.
Port of Tauranga Chief Executive, Leonard Sampson, said the Company continued
to grapple with the global supply chain disruption caused by Covid-19, while
preparing for possible operational disruption should the Omicron outbreak
spread in the Bay of Plenty.
He said shippers were playing their part in helping the Port avoid the
extensive delays experienced in late 2020.
"Importers and exporters have been very cooperative in helping us improve
terminal productivity by ensuring the terminal is not congested by cargo in
storage for excessive periods," said Mr. Sampson.
"Congestion during the traditionally busy month of December was considerably
less than in 2020, in part as KiwiRail were able to reinstate the number of
MetroPort trains to 92 per week from 72 the previous year."
Financial Results
Operating revenue increased 16.7% to $186.0 million due to changes in
container mix and higher per container revenue. Operating expenses increased
17.5% due to increased rail, labour, fuel and electricity costs.
Subsidiary and Associate Company earnings decreased 11.2% overall on the
previous corresponding period, partly due to changes in the Group's
accounting for the Timaru Container Terminal. Coda Group's performance
improved significantly from the previous year and Quality Marshalling also
produced strong financial results.
The Port of Tauranga Board has declared a fully imputed interim dividend of
6.5 cents per share, an 8.3% increase on the previous corresponding period.
Cargo Trends
Log exports decreased 6.1% to nearly 3.1 million tonnes for the six month
period as a result of softening international pricing and strong demand
domestically.
Direct dairy product exports increased 2.3% to just over 1.0 million tonnes.
Dry conditions and high commodity prices were reflected in increases in
fertiliser import volumes of 11.9%. Grain and feed imports increased 22.1% in
volume.
Direct kiwifruit exports increased 16.0% compared with the same six months
the previous year.
Oil product imports decreased 10.4% in volume.
Import demand remains elevated with the number of containers transferred by
rail, to and from Auckland, increasing nearly 21.0%.
Ship visits increased 3.5% to 684 vessels. However, transhipment rates
continue to be suppressed due to limited shipping options, changes to vessel
rotations, delays and congestion.
Outlook
The outlook for the second half of the year is uncertain, as supply chain
remains vulnerable and the full effects of the Omicron outbreak are unknown.
"We believe we have done everything we can to prepare for the inevitable
disruption of a large Covid outbreak. However, the upheaval of widespread
illness and employee isolation requirements is being felt worldwide, not just
in New Zealand," said Mr. Sampson.
Based on the first half performance, full year earnings are expected to be in
the range of $103 million to $110 million (compared with $102.4 million in
the 2021 financial year).
For further details, contact:
Leonard Sampson
Chief Executive
(07) 572 8824
Rochelle Lockley
Communications Manager
021 865 884
End CA:00387930 For:POT Type:HALFYR Time:2022-02-25 08:30:51
Click here
to view related attachments.
