Port of Tauranga Limited Analysis

Overview

The company was listed in May 1992 following a public issue of 33.6m shares at $1.05, which included a total of 12.6m shares previously owned by the Waikato Regional Council, and coincided with completion of a $53m expansion of port and cargo handling facilities.

The company's business predominantly services the forestry and farming industries in the region. Since listing the company has recorded strong growth in cargo volumes and increasing emphasis on container traffic. Significant recent initiatives have included establishment of Metroport, an inland port in South Auckland for the aggregation and distribution of import/export cargo, a 50:50 joint venture project with Northland Port to develop and operate a new $65m deepwater port (Northport) at Marsden Point in Northland, and acquisition of log handler Owens Services BOP (which operates in 10 ports.

POT derives its revenue through three main streams: port services, rental income and rental from investment properties. Other income also comes from investment dividends and fair value gains (losses).

POT has been granted Listing with a 'Non-Standard' ("NS") designation. This designation was granted because under the Port Companies Act 1988, changes to POT's Constitution must be approved by the Minister of Transport. For further information, please see the Port Companies Act 1988 which is publicly available at www.legislation.govt.nz.

Performance

The following information was extracted from Port of Tauranga Limited's Full Year results, released on 23 August 2024.

Financial results for the year ended 30 June 2024

Port of Tauranga Limited (NZX:POT) today reported improved cargo volumes in the second half of the financial year, as New Zealand’s largest port again proved its resilience in the face of economic headwinds.

Amid significant domestic and international supply chain challenges, total cargo volumes for the year decreased 4.2% to 23.6 million tonnes. Container volumes for the year decreased 2.5% to 1,147,350 TEUs.

The second half of the financial year saw significantly higher volumes than the first half, with container numbers increasing 13.7% and total trade growing 3.3% between the two six-month periods.

The company saw an underlying Group profit of $102.7 million, a 12.8% decrease compared with $117.1 million the previous year. The reported Group Net Profit After Tax of $90.8 million includes a one-off deferred tax expense of $11.9 million due to a change in tax legislation.

An intense focus on customer service has seen improved efficiency at Port of Tauranga despite ongoing challenges elsewhere in the domestic and international supply chain.

Highlights and challenges

For the year ended 30 June 2024 (compared with the previous financial year):

• Group Net Profit After Tax of $90.8 million
• Underlying Group profit of $102.7 million
• Total trade 23.6 million tonnes (a 4.2% decrease from 24.7 million tonnes)
• Container volumes of 1.15 million TEUs (a 2.5% decrease from 1.18 million)
• Revenue $417.4 million (a 0.8% decrease from $420.9 million)
• Imports 7.8 million tonnes (a 13.4% decrease)
• Exports 15.8 million tonnes (a 0.9% increase)
• Ship visits 1,427 (compared with 1,432)
• Final dividend 8.7 cents per share (compared with 8.8 cents per share in 2023)
• Total ordinary dividend 14.7 cents per share (compared with 15.6 cents per share in 2023)