Port of Tauranga Announces Change to the Board of Directors

The Chair of Port of Tauranga Limited, David Pilkington, today announced the appointment of a new Director, Alison Andrew, effective 1 April 2018.

Alison is currently Chief Executive of Transpower, having joined in 2014. She has held a number of senior executive roles across various industry sectors, most recently as Global Head of Chemicals for Orica PLC. She has also been a Director for Genesis Energy. Prior to those roles, she held a number of senior roles at Fonterra Cooperative Group and across the Fletcher Challenge Group in Energy, Forests and Paper. Alison has a MBA from Warwick University, and studied Engineering (Chemicals and Materials) at Auckland University.

David Pilkington said “We are extremely pleased to welcome Alison to the Board and believe her vast range of business expertise will add strength to our Board.”

Alison Andrew replaces Bill Baylis who retired on 19 December 2017.

Port of Tauranga Hub Port Role Intensifies

FINANCIAL RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2017

Port of Tauranga continues to grow as an international hub port, resulting in increased trade volumes and profits for the first half of the 2018 financial year.

Highlights

  • Revenue for the six months to 31 December 2017 increased 12.8% to $141.4 million and net profit rose 12.6% to $47.1 million.
  • Total trade increased from 11.0 million tonnes to 12.5 million tonnes for the period, a 13.4% increase.
  • Container volumes grew 15.8% to 590,803 TEUs (twenty foot equivalent units).
  • Transhipped TEUs increased by 47.6% in number.
  • Imports increased 20.7% from 3.9 million tonnes to 4.7 million tonnes.
  • Exports grew 9.4% from 7.1 million tonnes to 7.7 million tonnes, with a large increase in log exports (up 12.5%).
  • Interim dividend of 5.7 cents per share, up 14% on the previous period’s dividend.

Port of Tauranga today announced a half year Net Profit After Tax of $47.1 million, a 12.6% increase on the same period last year, following strong growth in most cargoes.

Half year trade volumes grew 13.4% to 12.5 million tonnes, contributing to a 12.8% increase in revenue to $141.4 million for the six months ending December 2017.

Transhipment volumes, where containers are transferred from one service to another, was up 47.6% on the same period last year when measured by TEUs (twenty foot equivalent units).

Port of Tauranga Chair, David Pilkington, said the impressive results demonstrated the continued consolidation of a “hub and spoke” port network in New Zealand.

“Tauranga serves as a hub for New Zealand shippers looking to quickly and efficiently move cargo to and from North Asia, and South America via big ship services,” said Mr Pilkington.

“Tauranga is the only New Zealand port able to accommodate the larger container ships on these international services.”

Port of Tauranga Chief Executive, Mark Cairns, said the transhipment figures showed just how much New Zealand shippers had come to utilise Tauranga as an international cargo hub.

Growth had accelerated following the September 2016 completion of a major dredging project that was the culmination of a $350 million expansion programme.

“We are delighted by the amount of transhipment occurring from other New Zealand ports, with transhipment volumes having more than trebled for the six month period – the largest increases occurring from the South Island ports and Napier,” said Mr Cairns.

Bulk cargoes are also increasing in volume. Mr Cairns said export growth had been driven by logs, which were in high demand by China and attracting record prices.

Imported cargoes grew significantly, with strong growth in oil products, and grain and feed supplements for the dairy industry.

MetroPort Auckland handled 8.4% more TEUs over the six months, compared with the previous corresponding period. The number of trains between MetroPort and the Tauranga Container Terminal has been increased from 78 to 86 per week to handle the growing volumes.

“We have the capacity to increase train frequency in future as we still have plenty of headroom on the route between Auckland, Hamilton and Tauranga. KiwiRail’s work to build passing loops in recent years has future-proofed our rail capacity,” said Mr Cairns.

Mr Cairns said the Company was now looking to the next phase of growth and scoping the people, plant and processes required to maximise productivity within the Port’s existing footprint. Of its 190 hectares of land, the Port has approximately 40 hectares of land still available for cargo growth.

“We can handle up to three million TEUs annually without any further reclamation, which has been been confirmed in the recent Ernst Young Port Future Study[1]” said Mr Cairns.

“We consider all evidence points to the trend to larger vessels continuing and even accelerating. Port of Tauranga is the only port in New Zealand able to accommodate the big ships and their cargoes.”

The Company has consistently delivered on a strategy of sustainable long term value creation for shareholders.  We recognise that long term value creation necessitates ongoing efforts to enhance our environmental performance as stewards of our natural environment and also recognition of our societal responsibility in how we manage the relationships that we have with our employees, our suppliers and the impacts of our business on the broader community in which we operate.

Cargo Trends
Log exports are buoyant on the back of strong demand from China and record prices for top quality logs. Volumes increased 12.5% to 3.3 million tonnes for the six month period.

Other forestry-related exports increased slightly, rising 2.6% to 1.1 million tonnes.

Dairy product exports increased 2.8%, while meat exports rose 17.3% in volume. Steel exports increased 40.9%.

In imports, grain and feed supplements for the dairy industry increased 34.7%. Bulk fertiliser imports grew 3.1% in volume.

Imports of oil products increased 13.5% for the six month period. There were also increases in dry chemicals, bulk liquids and cement.

Cars and other imported vehicles are a growing category for Port of Tauranga, with volumes increasing significantly as compared with the first half of the 2017 financial year.

The total number of containers handled increased 15.8% to 590,803 TEUs.

Ship visits increased to 890 – 15.0% more than the previous corresponding period.

Subsidiary / Associate Companies
PrimePort Timaru had a strong first half on the back of bulk cargo growth, seeing a 36.1% increase in net profit.

Northport’s trade volumes continue to grow.

Recently acquired contracts in new cargoes are starting to bear fruit for Quality Marshalling, with earnings up 28.3% on the previous corresponding period.

Coda Group’s profit declined compared with the previous corresponding period largely due to lower income from reduced empty container handling.

Outlook
Port of Tauranga is on track to handle in excess of 1.2 million TEUs in the year ending 30 June 2018.

Given the strong trading conditions, Port of Tauranga is raising its earnings guidance to between $92 million and $96 million for the 12 months to June 2018. This compares with the Net Profit After Tax of $83.4 million for the year ended 30 June 2017.

For further details, contact:

Mark Cairns
Chief Executive
Port of Tauranga Limited
Ph: 07 572 8829
http://www.port-tauranga.co.nz/category/current-news/

Presentation to Analysts

 
Interim Accounts

About Port of Tauranga:
Port of Tauranga, headquartered in the Bay of Plenty, is New Zealand’s largest port and international freight gateway. It operates wharves in Tauranga, Mount Maunganui and Timaru, as well as MetroPort Auckland, a rail-linked inland port in South Auckland and MetroPort Christchurch, an intermodal freight hub in Rolleston. The Port of Tauranga Group includes: Quality Marshalling (100% ownership), a cargo services company; Coda (50% ownership), a freight logistics group; Northport (50% ownership), the deep water commercial port in Whangarei; PrimePort Timaru (50% ownership), the commercial port in Timaru; Timaru Container Terminal (50.1% ownership), which leases and operates the terminal at Timaru; and PortConnect (50% ownership), an online cargo management system. For more information, please visit www.port-tauranga.co.nz.

[1] Ernst Young (June 2016).  “Consultant’s Report to the Port Future Study”.

Port of Tauranga Announces Retirement of Director

The Chair of Port of Tauranga Limited, David Pilkington, today announced the retirement of Director, Bill Baylis.

David noted that Bill joined the Board in 2006 and during his 11 years as a director has made a very strong contribution to the outstanding growth that the Port has enjoyed over that time.

Nga Matarae Scholarship 2018

The Trustees of Ngā Mātarae Charitable Trust are pleased to offer the Ngā Mātarae Scholarship Programme.

The Trust is a partnership between the Port and Tauranga Iwi with the primary purpose to promote the wellbeing of Te Awanui Tauranga Harbour.

Applicants intending to undertake study in a discipline that will benefit the wellbeing of the harbour and who are descendants of Tauranga Moana iwi (Ngāti Ranginui, Ngāi Te Rangi and Ngāti Pūkenga) are invited to apply.

 Applications closed at midday on Wednesday 24 January 2018

 

 

Port of Tauranga Limited Announces Change to the Board of Directors

The Chair of Port of Tauranga Limited, David Pilkington, today announced the appointment of a new Director, Robert McLeod.

Rob joined the Board of Quayside Holdings Limited in November 2016. Rob is currently on the Board of Sanford Group, and has been a past Board Member of ANZ National Bank, Tainui Group Holdings, Sky City Entertainment Group and Telecom. Rob was Oceania (Australia, New Zealand and Pacific Islands) CEO / Managing Partner for the international accounting practice of Ernst & Young and more latterly as Ernst & Young New Zealand Chair, a position from which he retired on 31 December 2015.

David Pilkington said “We are extremely pleased to welcome Rob to the Board and believe his vast range of business expertise will add strength to our Board.”

Rob McLeod replaces Quayside representative Michael Smith who retires, with effect from 31 October 2017.
David Pilkington said “Michael has made an excellent contribution to the Board over his 16 year term.”

For further details, contact:
David Pilkington
Chair
Ph:  021 609 635

Port of Tauranga Sees Strong Quarterly Growth on Back of Increase in Trade

Port of Tauranga today reported first quarter trade volume growth of 15% on the previous corresponding period.

Overall container numbers grew 26%, due to a significant increase in transhipment (containers transferred from one ship to another at Tauranga) in the three months to 30 September 2017. Log volumes increased by 13% compared with the same period last year.

Port of Tauranga Chairman, David Pilkington, says the first quarter results are further proof that Tauranga has cemented its role as New Zealand’s hub port.

“The trend to larger ships, and those ships making Tauranga their only Australasian call, has led to a significant increase in transhipment,” he says.

“Transhipment of cargo from other New Zealand ports to Tauranga has quadrupled in the past year.”

The largest container vessels to ever visit New Zealand have been able to call at Tauranga since the September 2016 completion of a major dredging project and $350 million expansion programme.

Mr Pilkington says the (unaudited) Group Net Profit After Tax is up 15% on the prior corresponding period.

“Based on the first quarter’s performance, and notwithstanding any significant market changes, we expect full year earnings to be between $88 and $92 million,” Mr Pilkington says. This compares with Net Profit After Tax of $83.4 million for the year ended 30 June 2017.

Port of Tauranga Chief Executive, Mark Cairns, says the Port has ample headroom to handle increasing volumes. Of its 190 hectares of land, the Port has approximately 40 hectares of land still available for cargo growth.

“This will allow us to handle around three million TEUs (twenty foot equivalent units) without any further reclamation,” he says.

For further details, please contact:

Mark Cairns, Chief Executive

Port of Tauranga Limited

Ph: 07 572 8829

http://www.port-tauranga.co.nz/category/current-news/

Chairman’s Address Chief Executive’s Address Annual Meeting Presentation

 

A Year of Records for Port of Tauranga

FINANCIAL RESULTS FOR THE YEAR TO 30 JUNE 2017

Port of Tauranga is confirmed as New Zealand’s largest, fastest growing and most productive port as container volumes increase 13.8% to a record of nearly 1.1 million TEU[1]; ships with a capacity of between 7,500 and 11,500 TEUs calling weekly following channel deepening

Highlights:

  • Annual container volumes exceed one million TEUs – a first for a New Zealand port
  • Total trade increases 10.3% to a record 22.2 million tonnes
  • Net Profit After Tax for the year to 30 June 2017 rises 7.9% to $83.4 million
  • Annual revenue rises 4.2% to $255.9 million
  • Port of Tauranga becomes the only New Zealand port to be “big ship capable”
  • Exports increased 8.0% to 14.2 million tonnes, while imports grew 13.7% to 8.0 million tonnes
  • A final ordinary dividend of 6.2 cents per share brings the total ordinary dividend to 11.2 cents per share – a 5.7% increase on the previous year.  In addition, a special dividend of 5 cents per share will be paid, bringing the total dividends for the year to 16.2 cents per share.

New Zealand’s busiest port, Port of Tauranga Limited (NZX.POT), today announced record annual earnings as freight volumes increased across all major cargoes.

Net Profit After Tax for the year to 30 June 2017 rose 7.9% to $83.4 million, from $77.3 million the previous year. The result was lifted by a 13.8% increase in container volumes to a record 1,085,987 TEU, as well as growth in log, dairy products and oil imports.  Subsidiary and Associate companies performed well with NPAT up 4.8% to $14.645 million.

Annual revenue rose 4.2% to $255.9 million, up from $245.5 million, while EBITDA increased 6.4%, from $143.2 million last year to $152.4 million this year.

Port land was revalued during the year increasing by $63 million reflecting the increase in land values over the last two years.

Port of Tauranga Chair, David Pilkington, said the results were a satisfying culmination to the Company’s $350 million expansion programme, which included a major harbour dredging project to widen and deepen shipping channels to accommodate larger ships.

“It’s been a monumental year,” Mr Pilkington said. “The successful completion of our dredging project in September was a turning point, as bigger vessels were able to call in New Zealand for the first time.”

“As soon as the dredging was finished, larger vessels were introduced on Tauranga-only port calls,” he said.

Vessels with nominal capacities of between 7,500 and 11,500 TEU now regularly call on a weekly basis, compared to a pre-dredging maximum of 4,500 TEU ships.

“These large vessels are providing New Zealand importers and exporters with very fast, direct and economic services to North Asia and beyond. As Port of Tauranga is the only Australasian port of call on these services, it is an efficient trans-shipping option for Australian exporters,” Mr Pilkington said.

As well as larger container vessels, the Port is also seeing larger bulk cargo and passenger ships. The giant cruise ship Ovation of the Seas – at 347 metres long and 50 metres high – made its first visit on Boxing Day 2016 and made two further calls, bringing nearly 4,900 tourists each time to the Bay of Plenty.

Capital Restructure and Dividends

Port of Tauranga’s five-for-one share split in October has achieved its objective of enhancing liquidity, with daily share trades increasing 45% and total shareholder numbers increasing 14%.

The Company today announced a further special dividend of 5 cents per share as part of its ongoing four year plan to return up to $140 million to shareholders. This follows a special dividend of $34 million, or 25 cents per share (pre share split), paid on 7 October 2016.

Directors have also declared a final ordinary dividend of 6.2 cents per share, taking total ordinary dividends to 11.2 cents per share, a 5.7% increase on the previous year. Total ordinary and special dividends will be 16.2 cents per share.  The record date for entitlements is 22 September 2017 and the payment date is 6 October 2017.

Dividends, coupled with the Company’s strong share price appreciation, have lifted total returns to shareholders to 18.7% over the year. They extend a record of the Company delivering a compound annual average return to shareholders of 18.3% over the last decade.

Industry Structure

Port of Tauranga believes the move to larger vessels will be accelerated by the ongoing restructuring in the shipping line sector.

“A hierarchy of fewer hub ports, supported by second-tier feeder ports connected by coastal shipping, is unquestionably the way of the future for New Zealand,” said Mr Pilkington.

“The sums of capital required to accommodate bigger ships, the aggregation of sufficient cargo, as well as the transport infrastructure to move it, is clearly not affordable across all of New Zealand’s current container ports,” he said.

Cargo trends

New services from Maersk, Hamburg Sud and Seatrade, and the larger vessels being utilised by the shipping lines, have had a significant impact on cargo volumes in the year to 30 June 2017. Exports grew 8.0% to 14.2 million tonnes and imports increased 13.7% to 8.0 million tonnes, with strong growth in all the largest cargo categories.

Export log volumes increased 20.1% to 5.5 million tonnes and dairy exports increased 4.9% overall.

The trend to larger ships calling only in Tauranga is reflected in the amount of containers which were trans-shipped (transferred from one ship to another), an increase of 31.0% to 245,896 TEUs.

Port of Tauranga Chief Executive, Mark Cairns, said this was evidence of the inevitable paradigm shift towards a hub and feeder port network in New Zealand.

Operational Developments

Mr Cairns said the Port’s relationships with major shippers such as Oji Fibre Solutions, Kotahi, Zespri International and Tauranga Kiwifruit Logistics had given the Company the confidence necessary to commit to ongoing investment in capacity.

In the past year, Port of Tauranga has commissioned two new Liebherr ship-to-shore gantry cranes and retired Crane #1 after 37 years of reliable service. The Tauranga Container Terminal now has an eight crane fleet and three berth operation, giving it unrivalled berth window flexibility and crane intensity options.

The container terminal has been reconfigured to expand the available container storage and handling space. In April, Oji Fibre Solutions moved into our new, purpose-built 22,000 m2 warehouse. Removing Oji’s old shed created space for a further 820 container ground slots right next to the berths.

The terminal now has capacity of more than 6,500 ground slots, with refrigerated container connections now at more than 2,300.

Mr Cairns said the Port maintained its industry-leading record for productivity. The “net crane rate”[1] for the year increased to 36.2 moves per hour, and the ship rate increased to 89.1 moves per hour – well ahead of New Zealand peers. The average ship rate is also 59% ahead of the average of five of Australia’s largest container terminals.[2]

Over the past two years, the number of trains running between Tauranga and the inland port MetroPort Auckland has increased from 54 to 78 per week, with the number of containers transferred by rail increasing 64%.  We are currently working with KiwiRail to further increase the frequency of trains to cater for expected growth.

In the South Island, the Timaru Container Terminal handled another new record of 84,946 TEUs – more than four times the volumes in the 2014 financial year, when Port of Tauranga took over operations.

Outlook

Port of Tauranga expects that cargo and earnings growth will continue.

Mr Cairns said there is still ample capacity to handle increasing volume, with considerable scope to expand within the Port’s current footprint. There are approximately 40 hectares of undeveloped, port-zoned land available for future expansion.

Port of Tauranga remains in a strong financial position, with net debt as at 30 June 2017 standing at $374.8 million, compared with $308.4 million at the same time a year ago. Gearing, as measured by net debt to net debt and equity, was 28.7% at year end.

“Our focus now is to continue to optimise productivity, remove waste from the supply chain and work with our partners to plan ahead,” Mr Cairns said.

Guidance on full year earnings will be provided at the Annual Shareholder Meeting on 19 October 2017.

For further details, please contact:

Mark Cairns, Chief Executive
Port of Tauranga Limited
Mob: 021 978 887

David Pilkington, Chair
Port of Tauranga Limited
Mob: 021 609 635

Presentation to Analysts

 

About Port of Tauranga:

Port of Tauranga, headquartered in the Bay of Plenty, is New Zealand’s largest port and international freight gateway. It operates wharves in Tauranga, Mount Maunganui and Timaru, as well as MetroPort Auckland, a rail-linked inland port in South Auckland and MetroPort Christchurch, an intermodal freight hub in Rolleston. The Port of Tauranga Group includes: Quality Marshalling (100% ownership), a cargo services company; Coda (50% ownership), a freight logistics group; Northport (50% ownership), the deep water commercial port in Whangarei; PrimePort Timaru (50% ownership), the commercial port in Timaru; Timaru Container Terminal (50.1% ownership), which leases and operates the terminal at Timaru; and PortConnect (50% ownership), an online cargo management system. For more information, please visit www.port-tauranga.co.nz.

Appendix: Non-GAAP profit reporting measures

Port of Tauranga’s standard measure of profit prepared under New Zealand GAAP is net profit. The Company has used the non-GAAP profit measure of EBITDA when discussing financial performance in this document.

The Directors and management believe this measure provides useful information as they are used internally to evaluate the performance of the group. Non-GAAP profit measures are not prepared in accordance with NZ IFRS (New Zealand International Financial Reporting Standards) and are not uniformly defined, therefore the non-GAAP profit measures reported in this document may not be comparable with those that other companies report and should not be viewed in isolation or considered as a substitute for measures reported by Port of Tauranga in accordance with NZ IFRS.

[1] Ministry of Transport Quarterly Container Handling Statistics.
[2] Australian Department of Infrastructure and Regional Development.
[3] Twenty foot equivalent units.

Port of Tauranga Receives National Biosecurity Award

Port of Tauranga is honoured to receive the inaugural Industry Award in the national Biosecurity Awards announced last night.  The Awards recognise leadership in support of New Zealand biosecurity.

Awards judge Dr John Hellstrom, MPI Director-General Martyn Dunne, Port of Tauranga Chief Executive Mark Cairns and Minister for Primary Industries Nathan Guy​

Port of Tauranga is New Zealand’s largest and fastest-growing port, handling more than 22 million tonnes of import and export cargo annually. In the past year, the Port processed more than a million TEUs (twenty foot equivalent units) of containerised cargo, the first port in New Zealand to do so.

Biosecurity is an integral part of the Port’s operations and is a joint effort. Port of Tauranga works with importers and exporters, service providers, the Ministry for Primary Industries, New Zealand Customs Service and the Bay of Plenty Regional Council.

In 2014, industry representatives Kiwifruit Vine Health and Port of Tauranga launched a partnership focused on achieving operational biosecurity excellence at the Port. It included an awareness programme for staff.

“It’s about everyone doing their bit and working together to protect New Zealand’s environment and primary industries from unwanted biosecurity risks,” says Port of Tauranga Chief Executive Mark Cairns.

“By having a heightened awareness of what to look for in day-to-day operations, all staff within the port community can play a part in keeping unwanted pests out of port operations.”

A target pest has been the Brown Marmorated Stink Bug, which likes to hitchhike on containers and has the potential to impact significantly on horticulture sectors. Another risk was cruise passengers disembarking with fresh produce that could be hosting fruit flies.

Port of Tauranga would like to acknowledge its partners in the initiative:

Port of Tauranga Sets New Zealand Container Throughput Record

Port of Tauranga today celebrated a new record of more than one million TEUs (twenty foot equivalent units) processed in a year – a first for any New Zealand port.

The milestone cements Port of Tauranga’s position as the busiest container port in New Zealand.

The one millionth TEU crossed the wharf on 6 June and the Company celebrated with customers and stakeholders at an event today.

Port of Tauranga Chief Executive, Mark Cairns, says reaching the one million TEU record is extremely gratifying after taking the strategic decision to become “big ship” capable.

“We have spent $350 million over the past six years to get ready for bigger ships and larger cargo volumes. Some were sceptical that average ship size would grow as much as it has, and so quickly,” he says.

“We were convinced of the trend towards larger vessels. It has paid off and we saw big ships start to arrive as soon as we completed our dredging programme last September,” says Mark.

The dredging programme deepened and widened shipping channels in and outside Tauranga Harbour. The first Maersk ships of 9,500 TEU capacity, 347 metres long, started calling last October. Ships of between 7,500 and 11,500 TEU capacity are now calling on a weekly basis, including a new seasonal service from Hamburg Sud launched in March.

“We’re delighted to see shipping lines take advantage of our increased capacity. The economies of scale mean New Zealand importers and exporters can access cost-effective, direct links to international markets,” says Mark.

As well as the dredging programme, Port of Tauranga has invested in additional gantry cranes, straddle carriers for moving containers around the terminal, and extended the container wharf length. Storage areas have been increased and additional trains are now transferring containers to and from Tauranga.

Port of Tauranga has stepped up productivity to manage the larger cargo transfers per shipment, achieving 64% higher productivity rates than the Australian port average and well above other New Zealand ports.

The port is also seeing an increase in the average vessel size of cruise ships and bulk cargo ships, including logging vessels. Royal Caribbean’s cruise ship Ovation of the Seas, 340 metres long and carrying 4,900 passengers, made its maiden visit in December.

Port of Tauranga handles more than 20 million tonnes of cargo annually, including 41% of the country’s exports.

It is estimated that the port is responsible for 43% of the Bay of Plenty’s GDP. The region has the fastest-growing economy in the country, increasing 7.7% in 2016.

For further details, contact:

Mark Cairns
Chief Executive
Port of Tauranga Limited
Ph: 07 572 8829

Click here for pdf version

 

Port of Tauranga On Track for One Million Containers (TEUs)

FINANCIAL RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2016

Half year net profit rises to $41.9 million from $38.6 million as the country’s premier freight gateway benefits from rising cargo volumes and continues to set standards for port productivity

Highlights:

  • Revenue for the six months to 31 December 2016 rises 2.8% to $125.3 million and net profit rises 8.5% to $41.9 million
  • Total trade increases 8% from 10.1 million tonnes to 11.0 million tonnes for the period
  • Container volumes rise 8% to 510,074 TEUs, reinforcing Port of Tauranga’s position as New Zealand’s largest container terminal
  • On track to handle more than one million TEUs in the 2017 financial year – a first for a New Zealand port
  • Imports increase by 7% in volume while exports increased 9% as log volumes recover
  • Interim dividend of 5 cents per share – up 8.7%[1] on the prior year’s figure

New Zealand’s largest freight gateway Port of Tauranga today announced it is on track to become the first port in the country to transport more than one million containers across its wharves in a single year.

It also announced a strong 8.5% improvement in Group half year net profit to $41.9 million from $38.6 million in the same period a year ago, as half year trade volumes grew 8% to 11.0 million tonnes and the Port continued to set new national standards for port productivity.

Half year Group revenue increased 2.8% to $125.3 million.

The Port of Tauranga Board has declared an interim dividend of five cents per share – up 8.7% on the prior year’s interim dividend1. The record date is 10 March and the payment date is 24 March 2017.

Chairman David Pilkington said: “Our results show the Port of Tauranga is continuing to reinforce its position as the country’s premier freight gateway. We have lifted revenue and earnings and moved record cargo volumes including more than 510,000 TEU containers.

“Exporters, importers and the shipping lines are increasingly recognising the benefits of our deep water port and our efficient freight handling and stevedoring operations.

“In the 2017 financial year, we expect to become the first New Zealand port to handle more than one million containers in a 12 month period. This achievement is the direct result of our now-completed five-year $350 million infrastructure investment programme, which has extended the Port’s freight  hinter-

land across the country, prepared the port for large ships and provided importers and exporters with highly-efficient routes to the country’s most important markets.

“Our world-class infrastructure will benefit the New Zealand economy for years to come,” Mr Pilkington said.

Chief Executive Mark Cairns said: “We are consolidating our position as the port of choice for international shipping lines, with ship visits in the six-month period rising 4% to 774 from 741 in the same period last year.

“Following the completion of our harbour dredging programme in September 2016, Maersk introduced a large vessel service, with Tauranga as its only New Zealand call.  The 9,500 TEU Aotea Maersk has been a regular visitor since October.

“Meanwhile, Hamburg Sud last month announced it will introduce in March a big ship, peak season weekly service, with Tauranga as its only New Zealand call. The largest cruise ship ever to visit the Bay of Plenty – the 4,700 passenger, 1,600 crew Ovation of the Seas – also made its maiden voyage to Tauranga on Boxing Day and has made a couple of further calls since.

“It is pleasing to see shipping lines take advantage of the possibilities created by the harbour dredging programme to bring in larger vessels. The economies of scale that come with larger ships drive transport efficiencies and ensure New Zealand exporters retain direct routes to international markets.

“With bigger ships calling at Tauranga, we are handling significantly larger volumes of cargo per shipment. We continue to lead the way in setting productivity standards for the New Zealand port industry and we strive to look at all aspects of the container terminal operations to ensure that we remain cost-effective.”

Ministry of Transport (MOT) figures from the fourth quarter of the 2016 calendar year show a crane rate for the quarter of 35.9 container transfers per hour, compared with the weighted national average of 33.7 moves per hour.

“Our ship service rate was 89.8 container exchanges per hour per ship, compared with the national weighted average of 76.9.   Such strong results, which rank Port of Tauranga in the top tier of Australasia’s most productive ports, are not only good for our shareholders, they are also in the best interests of the New Zealand freight industry,” Mr Cairns said.

During the half year period, Port of Tauranga invested $43.9 million in new infrastructure to further increase storage capacity and productivity. The investments included final payments on the two new gantry cranes commissioned, thirteen new straddle carriers and several property developments at the container terminal.

A new purpose-built shed is nearing completion and will be used by Oji Fibre Solutions (formerly Carter Holt Harvey) as a distribution hub, clearing the way for Oji’s former facility to be demolished and new container slots established to further enhance container terminal efficiency.

Traffic from our inland hubs continues to grow, with the numbers of containers transferred by rail between Tauranga and our MetroPort facility in Auckland increasing 20% compared with the first half of the previous financial year.

Cargo trends

Export volumes increased 9% to 7.1 million tonnes and import volumes increased 7% to 3.9 million tonnes.  Overall, trade increased 8% to 11 million tonnes. Containers handled increased 8% to 510,074 TEUs. Trans-shipped containers (containers transferred between vessels at Tauranga) increased 2% to 75,583 TEUs.

Log exports rebounded from the previous corresponding period, increasing 21% in volume to nearly three million tonnes.  Other forest products had mixed results, with pulp volumes up slightly (3%) to 291,000  tonnes but paper products were down 8% to 273,000 tonnes.

Dairy product exports increased 4% to 1,088,000 tonnes. Kiwifruit volumes increased 16% to just over 477,000 tonnes, a trend which is expected to continue for the next few years as the industry recovers from the PSA virus.

Other produce varied in volumes, with frozen meat exports decreasing by 25%, apples increased by 6%, and onions decreased by 23%.  Oil imports increased 10% in volume.

Fertiliser imports increased 10% and there was steady growth in other import categories, such as dry chemicals (up 13%), bulk liquids (up 13%), cement (up 5%) and salt (up 14%). Food supplement imports for the dairy industry decreased 10%, and grain volumes fell close to 20%.

Subsidiary/Associate Companies

Subsidiary and Associate profits were up slightly on last year to $8.04 million. In particular, Northport, and Coda had strong performances.

Outlook

Port of Tauranga is well positioned for the remainder of the financial year and beyond. The arrival of the Hamburg Sud service in March should provide a further boost to container volumes and ensure the Company reaches the milestone of handling more than one million TEUs annually by the end of the financial year in June.

Given the strong first half result, we expect earnings for the 12 months to 30 June 2017 to be at the upper end of our previous guidance of $79 million to $83 million, provided there are no significant changes to market conditions.

For more information, please contact:

Mark Cairns, Chief Executive                                     David Pilkington, Chairman

Mob: 021 978 887                                                       Mob: 021 609 635

 

Presentation to Analysts

 

Interim Accounts

 

[1] Adjusted for 5:1 share split on 17 October 2016