Lyttelton resumes dividend payments

Port Otago can look forward to some return on its 15.5%, more than $50 million stake in rival Lyttelton Port of Christchurch, which is resuming dividend payments after three and a-half years.

Following the Canterbury earthquakes, hard-hit LPC suspended all dividend payments from late-2010 but, with a pending $450 million settlement from insurers, has resumed dividends.

In reporting its half-year result to December yesterday, LPC chairman Trevor Burt said 2c per share would be paid in March.

Port Otago raided LPC shares in 2007, paying $37 million at the time to form a blocking stake against a planned sale and takeover of LPC, which was subsequently shelved.

Port Otago had, until the dividend suspension, received about $2.7 million.

Yesterday, its 15.5% stake, or 15.85 million shares, were at $3.30 per share worth $52.2 million, while its dividend due next month would be $315,000. LPC's 75% majority shareholder is the Christchurch City Council, which should be in line for about a $2.2 million dividend.

Port Otago chairman Dave Faulkner, who could not be contacted yesterday, inherited the LPC stake, and had maintained it should be considered a long-term holding.

However, his stance softened last month when he said it was ''prudent'' to wait for the half-year report before making any decisions on selling or holding the stake.

Mr Burt said LPC had achieved a ''significant profit'' for the half year, following settlement of its earthquake claims, noting its highest ever container terminal volume, up 9.2%, driven by strong imports and rural sector growth.

The gross insurance claim was $450 million and LPC was scheduled yesterday to receive the balance, after earlier deductibles of $382.7 million.

LPC booked a 6.4% increase on revenue, from $54.1 million to $57.6 million.

Craigs Investment Partners broker Chris Timms said excluding all earthquake-related expenditure, LPC's after-tax profit declined from $8 million a year ago to $6.5 million.

''It's a solid result for LPC, given the tough period it has been through in recent times,'' he said. Port Otago's half-year result is due next month.

- simon.hartley@odt.co.nz

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