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Port of Tauranga profit down

NZN 17/08/2016 Jonathan Underhill

Port of Tauranga has posted a 2.3 per cent decline in full-year profit, missing some estimates, while announcing plans to return $140 million to shareholders over four years.

Profit fell to $77.3 million in the 12 months ended June 30, from $79.1m, it said on Thursday.

Operating revenue fell to $245.5m from $268m, which it said partly reflected having to equity account Tapper Transport as an associate company within its Coda partnership.

The port company has been reviewing its capital needs because its five-year, $350m capital expenditure programme comes to an end in 2017.

It is dredging its shipping lanes to accommodate larger ships as soon as October this year, adding cranes, straddle carriers and tugs, expanding its wharf and marshalling areas, and buying property.

The first instalment of the capital return is by way of a fully imputed special dividend of $34m, or 25 cents a share.

"Port of Tauranga is in a sound financial position with strong prospects," said chairman David Pilkington. "We are looking ahead to the future with confidence."

The company will retain a strong balance sheet after the capital return while returning excess capital in a tax-effective manner, he said.

The company will pay a final dividend of 30c, also tax paid, lifting ordinary payments for the year by 1.9 per cent to 53c. Including the special dividends, payments are 78c.

Port of Tauranga currently has 136 million shares on issue and a market capitalisation of $2.6 billion.

The company's shares rose 2.2 per cent to $19.75 on the news, even though full-year profit missed forecasts of about $79.8m.

Container volumes rose 12 per cent to 954,006 TEUs (twenty-foot equivalent units) in the year. Total cargo throughput slipped to 20.1 million tonnes from 20.2 million, reflecting a decline in bulk cargo.

The port recorded a decline in log export volumes, meat, fertiliser bases and grain and dairy food supplements, while volumes of sawn timber, paper products, dairy products, kiwifruit and oil products rose.

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