Wednesday, July 6, 2022

Record profit for South Port

Fertiliser imports and log exports contributed to a record net profit of $6.5 million for Southland’s listed port operator South Port.

It will pay a 22 cents a share dividend for the year to June 30 showing the breadth of its regional business base offset the effects of a slowdown at the Tiwai Point aluminium smelter, chairman Rex Chapman said.

“Fortunately South Port has built a diversified trading base that reduces its reliance on specific cargoes.

“The improved profit level was largely driven by stronger levels of other bulk cargoes and better cold storage utilisation at both of the South Port physical storage sites,” he said.

Total cargo volume handled declined by 7% to 2.51m tonnes compared to the previous year’s record volume level of 2.69m tonnes.
About 100,000 tonnes or 56% of the total reduction in volume related to lower smelter activity. Other cargoes to record lower tonnages included stock food and wood chips.

South Port chief executive Mark O’Connor said a record level of fertiliser product was imported through South Port in the past season.

“Approximately 387,000 tonnes of fertiliser and sulphuric acid produced this record throughput (up from 342,000 tonnes in 2012).

“Log exports also staged a welcome resurgence particularly in the second half of the financial year with the full year volume at 246,000 tonnes (2012 – 198,000 tonnes). Two new log exporters, Highlander Forests and Forest Management, were active at South Port moving volume into Asian markets.

“The global softwood chip commodity market experienced a notable downturn and this reflected in lower volumes passing across South Port’s wharves. It is unclear when the market for this product will recover.”

“Stronger demand for dairy product by global markets meant that this sector was able to export volume more rapidly during the past season.

“As a consequence warehousing demand diminished and the overall dairy tonnage passing through South Port’s dry warehouses decreased.”

The dairy sector continued to be an important contributor to South Port’s overall activity providing a growing volume of import and export cargoes.

“The year ahead is likely to throw up a number of challenges despite positive economic indicators being promoted in the marketplace,” Chapman said.

“The Southern region of New Zealand is substantially dependent on our trading partners buying our premium grade primary produce.”

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