South Port has released its half year FY23 results showing short term disruption due to demand constraints in China and a slowing domestic economy.
Bulk cargoes through the Bluff-based port were slightly behind expectations with 1,732,000 tonnes of total cargo moved for the six months to December 31 compared to 1,745,000 tonnes in the same period the year prior.
Net profit after tax for the first six months of FY23 was $5.2 million (FY22 $5.9 million). Earnings per share were 19.6 cents (FY22 22.4 cps).
Operating revenue earned for the half-year stood at $24.9m.
The port points to the downward cycle in the log market due to the currently depressed property market in China as a contributing factor on its results.
Also, reduced fertiliser volumes are likely to remain similarly impacted for the remainder of FY223 due to depressed sheep and beef prices, it says.
Meanwhile, increased financing costs due to upwards movement in interest rates and additional debt on the balance sheet are also having an impact.
International container supply chains continue to be significantly disrupted and this will continue until there is a return to normal shipping windows, especially at the larger container ports in New Zealand, says chief executive Nigel Gear.
“Containerised cargo decreased 13% to 18,000 TEU. The main decreases were imported products for the manufacturing and farming sectors.”
Port chair Rex Chapman says the war in Ukraine, the rate of economic recovery in China and the threat of a global recession are impacting marketplaces and this has a flow-on impact on commodity prices.
“The container supply chain is still disrupted and although expectations are that it will improve, the timing is unclear.”
The port is providing guidance for FY23 earnings in the range of $11.1m to $11.6m (versus FY22 $12.8m).
