Falling cargo volumes, fewer ship visits, and Covid disruptions have grounded Napier Port's half year profit.
Photo: 123rf
Key numbers for the six months ended March compared to a year ago:
- Net profit $9.0m vs $10.6m
- Revenue $50.7m vs $52.6m
- Underlying profit $7.2m vs $10.6m ($1.8m drop in property values)
- Cargo vols 2,513,000 tonnes vs 2.786,000 tonnes
- Forecast full year underlying earnings $38m-$42m
- Interim dividend 2.8 cents a share - unchanged
The lower half year profit reflected Covid related disruptions affecting the shipping lines calling at the port and the producers providing the cargo to be shipped.
Container traffic was down 17 percent and bulk cargo, such as logs, was down nearly 9 percent, while there were more than 40 fewer ship visits and no cruise ship activity, which hit income while inflation and expansion costs raised its expenses.
Chief executive Todd Dawson said shipping schedules were unpredictable, with ships missing visits or being delayed.
"Ships arriving have required larger container exchanges for both us and cargo owners to manage. These factors have been compounded by pandemic-related absences across cargo owners' workforces and adverse local seasonal weather conditions."
Dawson said the disruption was set to continue in the near term at least.
"While we do not expect any immediate easing in the global supply chain challenges, we are confident that - as Covid-19 becomes endemic and the shipping industry gradually adapts to the current trading environment -these pressures will lessen."
However, the port was looking to an improvement with the completion of its new 6 Wharf, which is due to come into operation in late July, while it already had 90 cruise ship visits booked, although it expected some to be cancelled.
"The new wharf opens up growth opportunities and shipping options for cargo owners across the central and lower North Island. It will allow us to accommodate the larger vessels arriving in New Zealand and provide greater flexibility and availability across all our wharves," Dawson said.
"We expect the additional capacity 6 Wharf will deliver to begin to be evident in the new financial year."
The company maintained it full year underlying earnings guidance of between $38m and $42m.