Wharf woes hit port profit

Photo / Richard Robinson.

Ports of Auckland's ill-fated Bledisloe wharf extensions helped drive the Auckland Council-owned company's net profit down by $10.8 million (14.6 per cent) to $63.2 million in the year to June.

On a like-for-like basis, the company's profit eased by 3.1 per cent to $61.4 million, it said.

Chief executive Tony Gibson said the company, which lost the Maersk Pacific Star service to its rival, Port of Tauranga, early in the financial year, had gone against expectations by recording a 0.4 per cent increase in container volumes.

He said multi-cargo volumes had held up, with car volumes increasing 17.4 per cent to a record 243,801 units. Total breakbulk tonnage - including cars - was up 4.4 per cent on the year before.

Among the unusual items was a sum of $7.3 million which was put aside to cover costs and provisions for the Bledisloe Wharf extensions following the High Court's decision to over-turn the consents granted by Auckland Council.

"If the project had certainty, which it no longer has, those costs would not have been expensed," Gibson said in a statement. The company incurred a $4 million cost related to wharf and building demolition and made $2.4 million in severance payments to workers who left the port after settlement of a collective agreement with the Maritime Union.

The result also includes a gain from the revaluation of property of $14.6 million.

Costs were impacted by increases in infrastructure repairs and maintenance, Unitary Plan processes and development of future initiatives, he said.

Gibson said prospects for the coming year seem subdued, as a result of lower dairy prices and a fall in the New Zealand dollar. "We are expecting a softening in some import trades, slower growth in car volumes and a decline in bulk exports," he said.

Long-term growth prospects remain strong, in line with Auckland's growth.

"As the port on Auckland's doorstep we are the most direct route into the Auckland market and we expect our volumes to continue to climb," he said.