Port of Tauranga is reporting an underlying group profit of $102.7 million for its full-year result, a 12.8% decrease compared with $117.1m the previous year.
Group net profit after tax for the year to June 30 was down 22.4% to $90.8m which included a one-off deferred tax expense of $11.9m due to a change in tax legislation.
The NZX-listed port company saw revenue decrease 0.8% y/y to $417.4m.
Total trade was down 4.2% y/y to 23.6 million tonnes while container volumes were down 2.5% to 1.15 million TEUs.
The company says cargo volumes improved in the second half of the financial year with container numbers increasing 13.7% and total trade growing 3.3% between the two six-month periods.
Port of Tauranga chair Julia Hoare says the result was pleasing after a difficult start to the financial year.
Ongoing inflationary pressures and low consumer confidence had put pressure on imported cargo volumes, she says.
“We have seen a lot of volatility in demand, with big increases in log and kiwifruit exports at the same time as significant decreases in imports.”
The port is still contending with shipping schedule unreliability outside of its control, Hoare says.
However, the container terminal has continued to improve both safety performance and productivity levels. The average net crane rate for the year (container moves per hour per crane) increased 7.9% to 30.1.
“Our team and our service partners have done an outstanding job in ensuring Port of Tauranga is New Zealand’s most efficient port.
“Port productivity is a national issue and is of great concern to importers and exporters seeking efficient access to international markets.
“Currently, less than 30% of vessels arriving at Tauranga as a last New Zealand port are on time,” she says.
The port says it’s continuing to invest in critical infrastructure to deliver an effective supply chain for New Zealand.
This includes the Ruakura Inland Port in Hamilton, a joint venture with Tainui Group Holdings, which is celebrating its first anniversary. Trains running between Port of Tauranga and MetroPort Auckland now call daily at the inland port.
Port of Tauranga has taken delivery of a new container crane and an additional four hybrid straddle carriers, as it readies for the next stage of growth in a lower carbon future.
Cargo trends
Imports decreased 13.3% y/y in volume overall to 7.8 million tonnes.
Exports increased 0.9% y/y to 15.8 million tonnes, largely due to increases in log, kiwifruit, meat, and pulp exports.
Log exports increased 7.5% y/y to 6.7 million tonnes, the second highest year on record, largely due to a one million tonne boost to volumes post-Cyclone Gabrielle, the port says.
A large number of trees in the central North Island forests were damaged in the severe weather event and had to be harvested and exported earlier than planned.
Direct dairy exports decreased 3.4% y/y in volume and transhipped dairy volumes were down significantly.
Total meat exports increased 19.7% y/y in volume reflecting strong United States demand and trans-Tasman transhipment via Tauranga.
Direct kiwifruit export volumes increased 8.5% y/y.
Commodity price pressure saw dairy inputs reduce, with imported fertiliser volumes decreasing 16.7% y/y, while stock feed imports decreased 17.2% y/y in volume.
Imported oil products remained steady, decreasing 0.8% y/y in volume.
Transhipment decreased 12.1% y/y in volume due to changes in coastal shipping services.
A total of 109 cruise ships visited over the summer, close to the record of 116 visits prior to the Covid pandemic.
Outlook
Congestion in Asia caused by ships avoiding the Red Sea has worsened, with delays plaguing ports in Singapore, Malaysia, China, Sri Lanka, and United Arab Emirates, the port says.
The threat of escalating conflict and global economic conditions are also influencing cargo volumes and costs globally.
“We expect export log volumes to return to pre-2023 levels due to lower international prices. The domestic economy is also likely to have a continuing effect on imported cargo volumes,” it says.
“We have recently increased the weekly train programme between Tauranga and Auckland to 54 trains per week, up from 48, but still lower than the 92 trains per week at the end of last financial year.
“While increased rail costs have proved challenging, we are working with KiwiRail to ensure the rail option remains well-utilised and viable for our import customers.”
The port says it’s prepared to respond to New Zealand’s energy crisis, including the import of alternative fuel sources such as coal.
It has a purpose-built, enclosed coal handling facility that is connected via rail to the Genesis Energy power station at Huntly, avoiding the need to transfer imported coal via truck from other ports.
Despite the challenges, Port of Tauranga’s board and management “remain confident” of its resilience into the future due to the port’s operational strength, diverse cargoes, and multiple income streams.
Port of Tauranga will provide guidance for the 2025 financial year at the annual shareholders’ meeting on October 25.
