Containers and cargo of primary produce across the wharves
of Port Chalmers, pictured, provided owner the Otago
Regional Council with a near-record $12 million dividend
yesterday. Photo by Stephen Jaquiery.
One of Port Otago's best trading years has prompted
another near-record total dividend of $12 million to 100% owner
the Otago Regional Council, after posting its $14.6 million
after-tax profit for the year to June.
Logs, refrigerated cargoes, apples and the dairy sector
supplied multiple boosts to Port Otago, with container trade
up 13% and conventional cargo tonnage across its wharves
remaining at 1.3 million tonnes.
The $12 million dividend, of $7 million ordinary and $5
million special dividends, follows $11.75 million last year
and $12.25 the year before - both results included boosts
from special dividends. The ORC has received more than $126
million in dividends from Port Otago since 1990.
In presenting Port Otago's annual report to the ORC
yesterday, chairman Dave Faulkner said the port had achieved
an ''outstanding'' result, including record log volumes at
720,000 tonnes, a 13% increase to 195,000 of TEUs (20-foot
equivalent container units) and the group's $14.6 million
''On a global basis, competition between shipping lines is
intense, with every opportunity to reduce costs being
taken,'' Mr Faulkner said.
He highlighted exports of refrigerated TEUs, containing meat,
fish, apples, cheese and butter products was up 30%.
''Logging is in one of its most continuous up booms, because
of demand from overseas,'' Mr Faulkner said.
He was pleased with the completion of several projects,
including the $2.9 million oil wharf upgrade, replacement of
the crane rail on the wharf for $1.8 million and opening of
the $5 million 40,000sq m warehouse in Sawyers Bay, at
present 100% used for the dairy industry. The site still has
space for another 4000sq m shed.
Also as part of readying for bigger ships by dredging, Port
Otago's new $11 million tug was yesterday publicly named the
Taiaroa, with its delivery scheduled for August next year.
Mr Plunket said Taiaroa had special significance for Otakou
Runaka, chief Matenga Taiaroa having been a prominent Kai
Tahu leader at Otakou.
Group revenue for the year totalled $78 million, with an
increase from port operations to $65.3 million and property
rental income up at $12.7 million.
While Mr Faulkner said Port Otago booked a ''headline'' $38.1
million after-tax profit, that was boosted by an unrealised
(non-cash) gain in property valuations of subsidiary Chalmers
Property, which when stripped out, left the group profit at
The unrealised contribution of Chalmers, and also unrealised
$13.5 million increase in the value of Port Otago's shares in
Lyttelton Port of Christchurch, were booked as increasing
total assets from $397.1 million to $443 million.
Chalmers Properties saw rental income up 1% to $12.7 million,
with before-tax profit up 2% at $9.8 million.
Of the $23.5 million revaluation increase, the bulk was $18.2
million from the Dunedin portfolio, $4.5 million from
Auckland and $800,000 from land in Hamilton.
Mr Faulkner said Chalmers had contracts for future sales in
Hamilton and Auckland, the latter being selling of one
property and purchase of another.
Councillor Gerry Eckhoff asked for an explanation of the
''extraordinary'' $23.5 million revaluation contribution of
Chalmers, noted as a ''distortion'', to an ''otherwise good
result'', by councillor Sam Neill.
Mr Faulkner said earlier valuations had been done ''block by
block'' of properties, but a new valuer had undertaken a more
accurate''building by building'' analysis. He said rents
would not be hiked on the basis of the increased valuations,
which in some years had been down.
Councillor Michael Deaker asked what Port of Tauranga's
having taken a $20 million, 50% stake in Timaru's Prime Port
meant for Port Otago.
Mr Faulkner said the purchase had caught Port Otago, and the
rest of the port sector, ''by surprise'', and while likely
good for PrimePort, few understood Tauranga's strategy.
He remained confident Port Otago could still get its share of
dairy exports from Fonterra's nearby Clandeboye plant, which
is about 10,000 TEUs.