Lyttelton Port has no ‘clear view’ on earthquake claim bill
By Paul McBeth
Dec. 3 (BusinessDesk) – Lyttelton Port Co., South Island’s biggest port, has no clear view on the value of its claim for damages from September’s 7.1 magnitude earthquake.
Chief executive Peter Davie said the damage to the port was “extensive” and it is working closely with insurers to assess the cost and figure out the next steps. He downplayed media reports that the media the bill could be between $50 million and $200 million.
“The company wishes to advise that it does not have a clear view at present on the value of the claim,” Davie said in a statement. “Due to accounting requirements in the recognition and timing of insurance proceeds and the related expenditure, the impact on the profit is extremely difficult to forecast at this time.”
The earthquake scuppered a proposed merger with Port of Otago, as the Lyttelton operator was forced to focus on repairs. It could be several years before the foundation earth, which is reclaimed land, settles down from its agitated state.
Davie has previously said he expected the insurance bill to be more than $50 million.
The company has had a “very strong start to the year” with both profit and revenue in the first five months “significantly ahead” of the same period a year ago, he said.
The port forecast underlying earnings of at least $10 million in the 2011 financial year.
The shares were unchanged at $2.25 and have dropped 6.3% this year.