Vehicle volumes have helped keep the Ports of Auckland on track financially according to the company’s results for the year to the end of June – released today.
Car and light commercial vehicle volumes were up 1.7% to 248,065 units, while ‘high and heavy’ business, trucks, buses and equipment, were also strong.
That balanced out a fall in bulk shipping, and pressures on the container business, allowing the company to report a net profit of $84 million dollars – up $21 million on last year.
Chief executive Tony Gibson says he has pleased with what the port has achieved.
“We continue to make significant economic and social contributions to Auckland and New Zealand, despite operating in a difficult market environment,” Gibson says. “We thought it was going to be a tough year, and so it proved, but we still increased profit and dividend. T
“What we have been able to deliver a strong result in current conditions is a sign that our company is in good health.”
Two factors have contributed to a more difficult market he explains. Lower iron and steel prices have resulted in significantly lower iron sand exports and while this was partially offset by increased cement throughput due to Auckland’s booming construction sector, bulk volumes were down 5.5%.
“However, imports of cars, light commercial vehicles and ‘high & heavy’ vehicles increased, keeping the total fall in bulk and break-bulk volumes to just 2.2%. We expect similar volumes in the current financial year.”
Secondly, the container industry is facing ongoing difficulties caused by ship construction outstripping trade growth.
“The resulting overcapacity has led to a significant reorganisation of shipping services internationally, which is also affecting ports,” Gibson notes. “Twelve of the world’s top 30 ports have reported volume reductions this year.
“In New Zealand, the changes have resulted in volume leaving Auckland. The situation is expected to continue. Global container throughput is expected to grow by only 0.3% this year while shipping capacity will increase by 4.6%. We are expecting our container volumes to be flat or fall this financial year.”
“Our strategy has been to offer great service to customers, focus on improvements we can make through technological advancements, keep costs low and extend our reach into the supply chain so we can offer better value and service to freight owners,” he explains. “This is how we have been able to deliver strong results on lower volumes. We will continue and extend this successful strategy this year.”
POAL is continuing preparing for later ships, and developing automation technology.
“On port we are completing the container terminal infrastructure we will need to cater for larger ships. We will also start work to automate our container terminal, the first in New Zealand to do so. This innovation will increase capacity and reduce cost, making us even more competitive,” Gibson says.
“We are continuing to build our freight hub network. We have a cross-dock under construction at Wiri, South Auckland, and our Mt Maunganui Hub will open in September,” he notes.
:We will soon lodge resource consent for enabling work at our Waikato freight hub, which will be our largest. This hub is ideally located in the fast growing Waikato region, with excellent links by road and rail north, south and east. Like all our hubs it will be port neutral and so will help facilitate the movement of freight by the most efficient, natural supply chain.”
“There are many changes happening in our industry and it is an exciting time to be part of it. We look forward to the years ahead.”
