Ports of Auckland profit drops 15% on Bledisloe costs, container volumes unexpectedly rise
Sept. 11 (BusinessDesk) - Ports of Auckland posted a 15 percent decline in full-year profit as sales ebbed and the Auckland Council-owned company recognised costs related to the Bledisloe Wharf extension after the resource consents were quashed by the High Court.
Profit was $63.2 million in the 12 months ended June 30, from $74 million a year earlier, the port company said in a statement. Sales fell to $218.3 million from $221.2 million, which it said reflected the sale of its Connlinx unit, which managed the Wiri Freight Hub in South Auckland. Underlying profit fell 3.2 percent to $61.4 million.
Chief executive Tony Gibson said the outlook for the coming year was subdued, given lower dairy prices and the impact of a weaker New Zealand dollar. He expects weaker import trades, slower growth in car volumes and a decline in bulk exports.
The port managed to maintain container volumes in the latest year after the loss of the Maersk Pacific Star service to Port of Tauranga. Container volumes actually rose 0.4 percent to 972,434 TEU (twenty foot equivalent containers). The company remains the country's biggest container port, ahead of Tauranga, which lifted volumes by 12 percent to 851,106 TEUs, helped by its relationship with logistics group Kotahi under which agreed volumes of containers were delivered.
"Our container terminal is the most efficient in Australasia, with record productivity this year," Gibson said. To build on that performance, the company was investigating automation at its container terminal, investing in the facility and has increased the volume of containers moved by rail, he said.
The company is about to commission a scoping study on automation at the container terminal and will make a decision on whether to proceed will be made in early 2016. Rail volumes exceeded 100,000 TEUs while containers moved by truck fell by 53,508, it said.
Capital expenditure rose to $47.9 million in 2015, up from $27.4 million a year earlier.
Ports of Auckland will pay the council a dividend of $41.7 million, down from $66.6 million a year earlier, which was made up of a $50.2 million ordinary dividend and a special payment of $16.4 million.
Car volumes rose 17.4 percent to 243,801 units in the latest year. Total breakbulk tonnage rose 4.4 percent, the company said.
One-time items in the latest year included $7.3 million to cover costs and provisions for the Bledisloe Wharf extensions following the High Court’s decision to over-turn the consents granted by Auckland Council, the company said.
"If the project had certainty, which it no longer has, those costs would not have been expensed," it said. The company said it incurred $4 million of costs related to wharf and building demolition and paid $2.4 million in redundancy payments to workers who left after the settlement of a collective agreement with the Maritime Union. It also recognised a $14.6 million gain from the revaluation of property.