Port of Auckland has been told to expect lower car import numbers.
Port of Auckland has been told to expect lower car import numbers.
Belt-tightening shows in a new Port of Auckland report, with importers choosing trucks over rail to move their containers because it’s cheaper, and fewer car imports expected.
The port, in its latest 2024 financial year report to owner Auckland Council, said it was not on track to achievea key performance target of containers moved by rail, with 10.9 per cent moved by this mode to date compared with its FY24 target of 16 per cent.
The port attributed the shortfall to cargo owners electing to use trucks, to lower costs.
Nor was it on track to meet a performance target in imported car volumes, with 115,000 units offloaded in the year to date, short of a targeted 230,000 units for the financial year.
The port said it had been advised by car-carrying shipping lines to expect a softening in volume.
The previously poorly performing port has been working on a turnaround in the past 18 months since the appointment of a new chief executive and a fresh board of council-appointed directors. It is the country’s main import gateway.
Ports of Auckland CEO Roger Gray joined the Auckland Council-owned company in 2022. Photo / Dean Purcell
Presenting Q2 2024 and year-to-date summaries to the council this week, the port reported a “solid” first half of the financial year, with “strong progress” in operational efficiency, safety improvement, market share growth and profitability.
It said volumes were down across all trade categories, attributing this to a “significant drop in consumer consumption” in the first half.
It said the volume fall had been experienced across the whole New Zealand port sector.
“We were severely impacted by the DP World/Maritime Union of Australia industrial action which meant most container ships arrived off-window (berthing schedule time), restricting our ability to meet on-time departure performance targets...as well we have seen significant disruptions to the roll on/roll off trade as Australian ports remain clogged due to increased biosecurity checks....
“...Improved operational improvement projects are delivering improved crane rates, volume throughput and reduced dwell (vessel) times.”
The report said the port remained confident of delivering its budget and key metrics by the end of the financial year.
Announcing its half-year result last month, the port said it would pay an improved dividend of $20m to the city’s ratepayers. This was a $5m improvement on the return to the city in the same six months last year. It said it was on track to meet its expectation of a full 2024 financial year dividend of at least $35m and net profit after tax of $52m.
Last month the port said underlying net profit after tax for the first half was $21.2m, up $400,000 on the previous period’s $20.8m. It said this was a notable achievement given demurrage (cargo-holding) income fell $15m in the six months as supply chain congestion eased.
Revenue for the half year to date was $162.6m, up on the budgeted $162.2m. The revenue forecast for FY24 is $340.5m.
Ebit (earnings before interest and tax) for the year to date was $31m, up $500,000 on budgeted key performance target ebit.
