Napier Port has grown revenue 9% to $109.5 million for its full-year result, driven by record log exports of just over three million tonnes.
Its net profit after tax increased 5.2% to $23.2m for the financial year to September 30.
Operating activities increased 6.4% to $43.8m, offset partially by higher operating expenses including from the unwinding of 2020 cost savings to protect the port from COVID-19 uncertainty, the company says.
A final dividend of 4.7 cents per share will be paid, totalling 7.5 cps for the 2021 financial year, up from 5 cps for the prior year.
The company says resilience and diversity in its trade portfolio has helped mitigate the effect of container shipping disruptions and the absence of cruise ship visits caused by the ongoing effects of the COVID-19 pandemic.
Its bulk cargo revenue was up 32.7% to $41.5m mostly due to higher log volumes which increased 27.6% to a record 3.02 million tonnes. Average revenue per tonne improved due to tariff increases, one off cost recoveries, and an improved cargo mix, it says.
Container services revenue increased 4.8% to $65.3m on the back of a 2.9% increase in container volumes to 276k TEU and improved average revenue per TEU.
Construction of its new multi-purpose wharf which will be able to handle bigger and more ships is ahead of schedule and should be operational in the second half of the 2022 financial year.
Chair Alasdair MacLeod says the port has delivered in the face of a global pandemic, lockdowns, global shipping congestion, disrupted shipping schedules and supply chains.
“We have kept the cargo flowing and have moved record volumes, the majority of which was the food and fibre exports that underpin the prosperity of our region. Meanwhile, we have continued to invest in the infrastructure that will support our region and our customers for the long term.”
Chief executive Todd Dawson says the port has been successful in attracting cargo from outside Hawke’s Bay and this has been a factor in its strong results.
“This result is pleasing when it is considered against the challenges we faced within the global supply chain and container shipping trade. Charter vessel visits for the bulk trade increased to 343 up from 304 the previous year. In contrast, container ship visits fell to 242 compared to 293 in the year before resulting from the ongoing volatility in global shipping.
“Significantly, we hosted all these vessels while operating with reduced space on port due to the construction of 6 Wharf.
“We are delighted with the progress we have made on 6 Wharf. Cargo owners, and our regional economy, will benefit immediately from 6 Wharf. It will offer increased shipping capacity, the ability to handle more and larger vessels and improved availability across all our wharves, which will allow Napier Port to support the demands of our region today and the growth we see coming into the future,” Dawson says.
Shipping disruption expected to continue
Looking ahead, the port is expecting container-based supply chain and shipping disruptions to continue with the potential for volatility in the log export market during 2022.
Growth in the underlying result from operating activities of around 10% is expected for 2022, assuming a continuation of current market conditions and log export volume similar to 2021.
“The diversity of trades that pass across Napier Port’s wharves have protected the company from container-based supply chain and COVID-19 disruptions we have seen over the last year,” MacLeod says.
“It is clear however that these disruptions will continue in the new financial year. We are living with COVID-19 in the community. To protect our people and our region we have implemented a mandatory vaccination policy for staff, moving towards mandatory vaccination for port access by end of the year.
“Meanwhile, inflationary pressures are building in the economy, while our customers are facing a broad range of additional pressures, including the availability of shipping equipment, space on ships, and labour availability.
“Nevertheless, we see continuing global demand for the food and fibre exports that underpin the economy of our region and the trade across our wharves.
“Our base-case volume forecast for log exports in FY2022 is in-line with FY2021. We have been a beneficiary of buoyant log export markets for the past year, but we are not complacent about the potential for a cooling in these favourable conditions to impact volumes through Napier Port,” MacLeod says.
