Ports of Auckland net profit down 30pc

Ports of Auckland’s net profit dropped 30 per cent to $53.9 million in the June year, which the company put down to port disruption while it installs automated straddle carriers, the loss of a service, and a decline in car imports.

As earlier advised, the company opted to not pay a final dividend to its owner, Auckland Council, as part of a plan to pay out just 20 per cent of its net profit, down from the normal 80 per cent.

The lower dividend plan would allow the company to maintain its debt to equity ratio of 39 per cent while it continues to invest heavily in the port.

Ports of Auckland’s $100m project, which involves driverless straddle carriers at its northern berth, is expected to go live in February.

An interim dividend of $18.6m was paid compared with $51.1m in the previous corresponding period.

For the 2020 and 2021 financial years, the port anticipates paying a dividend of 20 per cent of after-tax profits in order to fund the investment programme.

Coalition government partner NZ First has called for shifting the port to Northland.

Chief executive Tony Gibson, in announcing the result, took a swipe at politicians and others who advocate such a move.

“Our issue is that every time a politician talks about moving the port, it undermines the business and value,” he said.

“We know that we have lost business because of politics.”

In its annual report, chair Liz Coutts said Ports of Auckland and its location continues to be a hot topic.

“Such speculation is unsettling for staff and customers alike and we hope the next 12 months will provide some resolution of the topic with the conclusion of the Government’s Upper North Island Supply Chain Study,” she wrote. “Whatever the outcome, it is clear that moving a port is a large and expensive job that will take decades,” Coutts said.

The port said container volumes were down 3.5 per cent to 939,680 TEU (20ft equivalent units).

Car and light commercial vehicle volumes were by down 14 per cent to 255,252 units. Non-car bulk and breakbulk volumes rose 7.4 per cent to 3.7m tonnes.

Chief executive Tony Gibson said it had been a “challenging” year, marred by the death of an employee in a straddle carrier accident.

Gibson said the port had completed most of the infrastructure work for the automation project.

“Once automation is live and the peak of investment has passed, we will again be able to deliver a higher return and dividend level,” he said.

Gibson told the Weekend Herald it was a good result under the circumstances. “We are rebuilding while still operating, so there is a of disruption and a shortage of capacity,” he said.

It is the first port in the world to install automated straddle carriers while still functioning as a port.