Northport appeals permit decision
NewsNorthport in New Zealand is appealing a decision denying resource consents for its planned expansion to create a larger container terminal and facilities.
Port Otago reports substantial profit
Port Otago’s 2023/24 financial report reveals a 30% increase in net profit, reaching NZ$ 30.4 million (US$ 19 million), driven by four core business units.
Port Otago has published the 2023/24 financial report, disclosing a net profit after tax of NZ$30.4 million (US$19 million), up 30% on last year’s NZ$23.3 million (US$14.5 million) result.
The profit was generated from the four core business units – container, bulk, cruise and property – and excludes property revaluations, adjusted for the margin on completed property development projects and one-off items.
Port Otago measures its business on an underlying profit basis and, for the 2023/24 year, the underlying result was NZ$34.4 million – up 7% on last year’s NZ$32.0 million. The company has paid an annual dividend of NZ$16.0 million to its shareholder, the Otago Regional Council (ORC).
The equity ratio was 78% on 30 June 2024, comfortably within the Statement of Corporate Intent range of 70% to 85%.
269,000 TEU
Port Otago Chair Tim Gibson presented the financial results to the ORC, emphasizing that the Board is delighted with the result, which includes record seasons for both the container and cruise businesses.
“It’s great our container business contributed to the bottom line this year. Our Port Chalmers terminal handled a record 269,000 TEU, which included 104,000 transships units. This total throughput was 44% higher than last season. To manage the additional volume, 16 new Cargo Handlers were recruited and joined our kaimahi [staff] in the second half of the season. A big thank you to our existing Operations team who stepped up to keep the wheels turning in the meantime.”
Gibson says the other particularly noteworthy element of this year’s result is a NZ$47 million investment into developing port and property assets. “We did this without increasing our borrowing and while continuing to meet our dividend commitment to the ORC. In the future, we will continue investing to remain resilient and profitable.
“We know what’s coming and that is the increasingly severe impacts of climate change on our coast and the need to reduce our carbon emissions. Proactively investing in mitigating these risks and accommodating future shipping demands is not a ‘nice to have’. It is essential.”
Operating expenses up
Group revenue was significantly up on last year – NZ$133 million, compared to NZ$111.3 million. Operating expenses were up 12%, largely due to increased wages associated with a new shift model introduced to handle the increased container throughput.
Bulk cargo volumes were down marginally to 1.70 million tonnes, compared to 1.77 million tonnes last year. Log export volumes remained consistent at 1.0 million tonnes.
While challenging economic conditions and increasing costs of construction slowed demand for new warehouses, two new builds were completed in Te Rapa Gateway during the year and a further two are currently under construction.
Three significant projects were delivered during the year. The Port Chalmers 1890s wooden Cross Wharf was rebuilt for NZ$8.3 million. It was the final element to complete the company’s fit-for-purpose wharf infrastructure. The Marine team welcomed the NZ$3.4m Te Rauone pilot boat to the fleet. Additionally, the Operations team opened a new container depot at Ravensbourne to provide additional capacity for customers and shipping partners.
Outlook
Looking ahead, tougher economic conditions will continue to challenge the region’s economy, Gibson says. “We expect export volumes to reduce as some sectors struggle to pass on increased costs, and imports to stay at low levels. We do know that there will be 20% fewer cruise ships calling this season, as cruise lines reposition vessels to higher-yielding markets offshore. We are engaged with cruise lines, to win back business in the medium term.
“At an operational level, there is significant activity, including replacing ageing railway infrastructure and upgrading the cruise terminal at Port Chalmers. We are also investing in strengthening the Aramoana Mole. All of these activities are critical for the business to be always open.”
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