Napier Port has posted net profit of $12.8 million for its half-year result but warns of an “uncertain outlook” due to the impacts of COVID-19.
The result was up 39% compared to the $9.1m net profit in same period the previous year with revenue also up 7.5% to $52.3m.
Container volumes were up 7.5% to 135,000 TEU while bulk cargo volumes were down 7.3% to 1.6 million tonnes.
This included a 5% decline in log exports due to high Chinese log inventories compounded by the COVID-19 outbreak and extended Chinese new year holiday.
Fertiliser imports also declined and contributed to an overall drop in bulk cargo revenue, down 3.5% to $16m.
The company says growth in container services and cruise ships helped offset the effect of lower log volumes.
Although the cruise season came to “an abrupt and early end” following the COVID-19 outbreak, cruise services revenue for the first half was up 22.5% to $4.2 million from $3.4 million.
This included 76 ship visits compared to 66 ships in the prior season. There had originally been 87 ships booked.
Container services benefited from the early repositioning of empty containers ahead of the peak primary export season.
The increased volume helped lift container services revenues 12.1% to $30.9m. Average revenue per TEU increased 4.2% to $229 per TEU, assisted by increased volume through the company’s Port Pack operation and tariffs introduced during 2019 to recover costs of infrastructure investments.
Napier Port chief executive Todd Dawson says the company “is having a year of two halves”.
“In the first we have delivered on the expectations we set when we launched our IPO last year, but in the second half of the year we, along with the rest of the country, are facing a period of extended uncertainty and an external shock that has significant implications for trading in the current financial year and beyond.”
Meanwhile, chair Alasdair MacLeod says the results “stand in stark contrast to the significant challenges that we, the surrounding region, and the broader economy face as a result of the COVID-19 pandemic”.
MacLeod says trade volumes were in line with expectations for most of the first half period, however the impacts of COVID-19 and the level 4 lockdown will have a “material impact” on the full year result.
Many of the port’s key trades operated as essential services during alert level 4 including the flow of apples, squash and other fresh produce.
The region’s food and meat processing industries also continued production with products flowing during the period and primary food-based exports seeing continued demand.
Following the lifting of the level 4 lockdown, exporters of forest products quickly resumed and ramped up production to meet demand.
Containerised trades such as the wood pulp and milled timber are up and running again and working to fulfil back orders and forecast demand, the port says.
A partial revival of economic activity and some clearing of inventories in the key market of China has also seen improvement in log prices into April.
