Expansion Sees Port of Tauranga Fiscal Year Earnings Rise

By Ben Collins Features Dow Jones Newswires

Port of Tauranga (POT.NZ), New Zealand's biggest container port, said its net profit rose by 7.9% in the year through June as freight volumes increased following a multi-year expansion program.

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The company said its after-tax profit was a record 83.4 million New Zealand dollars (US$60 million) and that annual revenue rose 4.2% to NZ$255.9 million.

Its board declared a final dividend of 6.2 NZ cents as well as a special dividend of 5 cents--part of a four-year plan to return up to NZ$140 million to shareholders--which takes the total payout to 16.2 NZ cents.

Port of Tauranga Chairman David Pilkington said the result was the culmination of an expansion program. The company has invested NZ$350 million in recent years to dredge the port and create deeper, wider channels to enable larger container ships to enter the harbor.

In October last year, it received the Aotea Maersk--a container ship nearly as long as four rugby fields and capable of carrying twice the load of the biggest vessels that had previously visited the port.

Management have justified the expansion as helping to reduce the impact on Port of Tauranga's earnings of big swings in demand for individual commodities, such as log exports.

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"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," Mr. Pilkington said in a statement on Friday.

"As soon as the dredging was finished, larger vessels were introduced on Tauranga-only port calls."

During the 2017 financial year exports from the port increased 8% to 14.2 million tonnes, while imports grew 13.7% to 8 million tonnes, it said.

Port of Tauranga expects that cargo and earnings growth will continue in the 2018 financial year.

Write to Ben Collins at ben.collins@wsj.com

(END) Dow Jones Newswires

August 24, 2017 17:22 ET (21:22 GMT)