Port Taranaki has announced a net profit after tax (NPAT) of $8.9m for the year ended 30 June 2016.
The result was down 22.0% on the previous year, when Port Taranaki benefitted from a strong oil and gas exploration programme off the Taranaki coast.
Port Taranaki Chief Executive Guy Roper said more demanding economic conditions in the past financial year had an impact on profit and overall revenue, which at $44.7m was down 10.6%.
Port Taranaki returned a $4.48m dividend (up 10% on the previous year) to its sole shareholder, the Taranaki Regional Council.
“A major component of Port Taranaki’s revenue is tied to the commodity markets of oil and gas, forestry and agriculture, and the port is feeling the effects of the reduction of offshore oil and gas exploration in the region,” Mr Roper said.
The downturn in oil and gas resulted in a 42.3% decrease in the offshore business with turnover down $2.8m. Revenue from bulk liquids was also down, by 9.8%.
“This was a combination of lower levels of condensate in a softer oil price environment and lower methanol volumes,” Mr Roper said.
Fonterra’s decision to operate its own container transfer services at its New Plymouth cool store resulted in a 72.3% decrease in revenue (compared with the previous year) from the container sector.
“Nationally, the container trade is going through change. We continue to watch developments closely and have the onshore equipment and expertise ready to recommence the service should the opportunity arise,” he said.
However, a record year for log trade – where Port Taranaki achieved an 80.0% increase in revenue – bolstered the port’s result.
“With containers not having passed over the wharves, the area previously dedicated to containers was converted into a log yard to better facilitate the growing demand for this type of storage space,” Mr Roper said.
“Along with logs, revenue gained from providing storage solutions for our customers has also helped to ease the impact of the downturn in oil and gas, and the loss of the container transfer facility.
“Our ongoing focus is to free up Port Taranaki land to provide more storage options close to wharves for our customers. This was the reason behind the purchase of the former power station site, which is now being used to store bulk dry goods.”
Total investment for the year was $15.3m.
The largest project was the purchase of the Omata tank farm ($5.1m), which is being refurbished and has been leased to BP in a long-term partnership. The partnership will ensure increased volumes of motor spirits come into the region through the port, resulting in fewer petrol tankers on Taranaki roads.
The purchase and installation of a second set of ShoreTension units ($2.1m) further reduces vessel exclusions from the port during long period waves, giving customers greater certainty and efficiency for cargo exchanges.
During the year, Port Taranaki completed a review of its business, with the aim of improving its operations to gear the business toward a more responsive and customer focussed organisation.
“The review was challenging and confronting, but we believe we are now a more sustainable and stronger business,” Mr Roper said. “We are thankful for the collective efforts of management and staff to assist the company during this process.”
The review was successful in controlling operating costs, resulting in an overall reduction of costs by 3.1%.
“Reducing costs will improve our competitiveness, which is to the long-term benefit of our customers,” Mr Roper said.
In the past financial year, a revaluation of Port Taranaki land recorded a $12.8m increase, $4.0m of which was from the introduction of the former power station property.
Port Taranaki Chairman John Auld said the business would continue to be forward thinking, innovative and a responsible investor of capital in an increasingly competitive industry.
“Profitability for the next financial year is expected to be at similar levels. We will look to further explore development and growth, providing good customer service and utilising our assets to their full potential,” Mr Auld said.
He was also proud of Port Taranaki’s industry-leading focus on health and safety.
“The board’s Health and Safety Governance Committee has ensured we are working to achieve best practice in health and safety. We have compulsory induction procedures, on-going training, permit-to-work procedures, random drug and alcohol testing, and we are the first port in New Zealand to adopt a site-wide smoke free policy,” Mr Auld said.
2016 Year Port Taranaki Cargo Trends
- Total trade decreased 8.1% to 5.2m tonnes
- Exports decreased 8.2% to 4.3m tonnes
- Imports decreased 8.1% to 0.8m tonnes
- Log volumes increased 71.2% to 0.36m tonnes
- Bulk dry volumes decreased 4.1% to 0.68m tonnes
- Bulk liquids volumes decreased 9.8% to 4.07m tonnes
You can access the 2016 Annual report by clicking here