Smooth sailing for port shareholders
Planning for the long term has paid off for Port of Tauranga, which posted a record-breaking profit for the year to June 30.
The port reported annual revenue of $255.9 million, up 4.2 per cent, and a net profit after tax of $83.4m, up 7.9 per cent.
Chief executive Mark Cairns said 2017 was a ‘‘record-breaking year’’ for the port, thanks to the completion of a $350m expansion and dredging programme to widen the channel to allow large container ships to enter the port.
Weeks after the expansion was completed, 325-metre and larger container ships from Maersk starting arriving, capable of carrying 11,500 containers.
Tauranga is now New Zealand’s only ‘‘big ship capable’’ port.
‘‘We hit 1 million TEU [20-foot equivalent unit] containers this year and were the first port in New Zealand to break through that milestone,’’ Cairns said.
‘‘It shows we have engaged the long-term relationships with exporters and this is showing good earnings growth.’’
Trading increased 10.3 per cent, up to 22.2 million tonnes a year.
Exports increased 8 per cent to 14.2 million tonnes while imports increased 13.7 per cent to 8 million tonnes.
Cairns said the growth of the port meant big things not just for shareholders, but for Tauranga, which was also enjoying an expansion with new buildings being planned in the city.
‘‘Our growth reflects the city’s growth. Tauranga has the highest GDP growth at 7.7 per cent and there have been studies that the Port of Tauranga contributes about 43 per cent of the region’s GDP,’’ Cairns siad.
Plans to further increase its returns are under way.
‘‘We expect cargo and earnings growth to continue. There is still ample capacity to handle increasing volume, with considerable scope to expand within the port’s current footprint,’’ Cairns said.
Port of Tauranga remains in a strong financial position, with net debt as at June 30 of $374.8m, compared with $308.4m at the same time a year ago.
‘‘Our focus now is to continue to optimise productivity, remove waste from the supply chain and work with our partners to plan ahead,’’ Cairns said.
Guidance on full-year earnings for the 2018 financial year will be provided at the annual shareholder meeting on October 19.