Solid half-year result for Port of Tauranga

Total cargo volumes are up at Port of Tauranga, pictured, with a ninth crane ordered and 385m...
Total cargo volumes are up at Port of Tauranga, pictured, with a ninth crane ordered and 385m wharf extension under way. PHOTO: SUPPLIED
Total trade for the country's largest port, Port of Tauranga, has risen almost 9% for its half-year result, with expectations its full-year profit will be at the upper end of a forecast range of $96million-$101million.

Increased logs, meat and kiwifruit volumes contributed to the result, with container numbers also up.

Container transshipments rose, while dairy was "steady''.

Imports rose 5.7% to almost 5million tonnes, and exports rose 10.8% to 8.6million tonnes.

Sales revenue rose 8% to 153million for the six months to December, including a 7% rise to $14.3million from property services, earnings before interest and tax was up 118% to $140.1million and underlying after-tax profit rose 4% to $49million.

Forsyth Barr broker Suzanne Kinnaird said the result was driven by container volumes, up 5%, but helped by transshipments, logs up 12% and kiwifruit export gains above 30%.

"Above-trend cargo growth is the key highlight for Port of Tauranga (POT), but the company's ability to leverage [the] strong cargo growth into accelerated profit growth continues to be a challenge.''

POT earnings growth outlook continued to look "modest'' rather than "strong'', she said.

Crucial transshipments of containers, from vessel to vessel, grew by 18.9% to 174,983 TEUs, (20-foot equivalent containers) more than 20% of the total 621,117 containers, which grew 5.1% overall.

Craigs Investment Partners broker Peter McIntyre said transshipments were a feature in the result and a big part of the level of "outperformance''.

POT would pay a 6c interim dividend, up 5.3%, but Mr McIntyre noted there was no mention of continued special distributions.

"POT has previously said it will undertake a review of capital requirements in the second half,'' he said.

POT chairman David Pilkington said the port was working very well as an international hub for shippers wanting access to large ship container services.

POT's inland freight hub MetroPort Auckland handled a 3.8% container increase to set a seasonal-peak record in cargo transferred by rail to and from Auckland.

POT chief executive Mark Cairns said all evidence pointed to a continuing trend to larger vessels.

A ninth container crane has been ordered and a 385m wharf extension is also under way.

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