South Port pleased by $4.6m profit

South Port New Zealand has posted a net profit after tax of $4.6 million for the first six months of the financial year.

The Bluff Harbour port company’s chairman, Rex Chapman, said considering recent market conditions it was a pleasing start to the financial year. The half-year period ended on December 31.

‘‘Bulk cargoes, particularly logs and fertiliser, came under pressure due to market conditions and inclement weather patterns respectively. This was balanced out by a strong performance in the cold-storage operation as a result of recent capital investments allowing an increase to blast-freezing capacity.’’

The key factors related to the interim result included particularly wet conditions in the region that resulted in lower than expected volumes of inbound fertiliser.

High log prices in China also led to an oversupply of softwood into the market, which was exacerbated by a bark beetle infestation in Europe that pushed large volumes of spruce logs into the market.

The two factors led to a reduction of log exports through the port.

Port chief executive Nigel Gear said: ‘‘The recent outbreak of the coronavirus has sent ripples through the international marketplace, impacting tourism and trade.

‘‘There is a fair amount of uncertainty as to the level of impact ... Our expectations are that all other cargoes will track close to budget with potential upside in containers and cold-storage activities, although the recent flood event in rural Southland and Otago may impact volumes.’’

Gear said total cargo activity was 1.687 million tonnes compared with 1.772 million tonnes in the prioryear interim period, a reduction in cargo flows of 85,000 tonnes.

South Port estimates that its fullyear earnings should be between $8.2m and $8.7m, slightly lower than the $9.79m posted in 2019.

The company has declared a fully imputed interim dividend of 7.5 cents a share, the same as 2019, payable on March 4.