NEW Zealand’s Port Otago has reported its financial performance for the financial year 2023-24 (FY24), recording a net profit after tax of NZ$30.4 million, up a whole 30% on the FY23 result.
The South Island port measures its business on an underlying profit basis, and for FY24 the underlying result was NZ$34.4 million, up 7% on last year’s NZ$32 million.
Group revenue increased significantly at NZ$133 million, compared to NZ$111.3 million in FY23.
Operating expenses were up 12%, largely due to increased wages associated with a new shift model introduced to handle the increased container throughput, the port company said.
The port saw record numbers in its cruise sector, receiving 118 vessels carrying 272,000 passengers and crew in FY24, providing an estimated NZ$90 million to the region’s economy.
Bulk cargo volumes however did see a decrease to 1.7 million tonnes, compared to 1.77 million tonnes in FY23. Log export volumes remained consistent at 1 million tonnes.
Port Otago chair Tim Gibson said the board is delighted with the result, which includes record seasons for both the container and cruise businesses.
“Our Port Chalmers terminal handled a record 269,000 TEU, which included 104,000 transships units. This total throughput was 44% higher than last season,” Mr Gibson said.
“In order to manage the additional volume, 16 new cargo handlers were recruited and joined our kaimahi (workforce) in the second half of the season.”
Mr Gibson said the other particularly noteworthy element of this year’s result is the inclusion of an NZ$47 million investment into developing port and property assets.
“We did this without increasing our borrowing and while continuing to meet our dividend commitment to the Otago Regional Council. In the future, we will continue investing to remain resilient and profitable,” he said.
“We know what’s coming and that is increasingly severe impacts of climate change on our coast and the need to reduce our carbon emissions.”
“Proactively investing in mitigating these risks and accommodating future shipping demands is not a ‘nice to have’. It is essential.”
Looking to the near future, the port expects tougher economic conditions will continue to challenge the region’s economy.
“We expect export volumes to reduce as some sectors struggle to pass on increased costs, and imports to stay at low levels,” Mr Gibson said
“We do know that there will be 20% fewer cruise ships calling this season, as cruise lines reposition vessels to higher-yielding markets offshore. We are engaged with cruise lines, with the goal of winning back business in the medium term.”
Mr Gibson said that there is significant activity at an operational level, including replacing ageing railway infrastructure and upgrading the cruise terminal at Port Chalmers.
He also thanked the company’s workforce for “another solid year” and stepping up when it was needed.
“As reflected by our bottom line, it was a big year for the business.”
