Napier Port's net profit is down 18.8%, dropping to $16.6 million from $20.4m, in line with expectations after the disruption of pandemic pressures and Cyclone Gabrielle.
This comes after a tough year, with softer trade markets, global economic uncertainty, a continued inflationary environment and the recovery from the devasting cyclone.
New Zealand’s fourth largest port posted its annual report to the NZ stock exchange on Tuesday and showed that while revenue was up 3.4% at $118.4m, operating activity fell 7.1% to $37.2m.
Todd Dawson, Napier Port's chief executive, said: “Despite the challenges presented by Cyclone Gabrielle, this year has reinforced the resilience of Napier Port, our region and the cargo owners who produce the high-value food and fibre products that the world continues to demand."
It also received a $7.25m business interruption insurance claim after Cyclone Gabrielle.
The revenue increase was not fully offset by the impact of inflationary cost pressures. It also said the lower operating result was driven by a lower trade volume post-cyclone.
Vessels
Total trade volume dropped 14.4% to 4.6m tonnes, compared with 5.4m tonnes the previous year. By volume, export was just over 80%.
While the port may look to cruise ships as its salvation post-cyclone with a $5.3m revenue contribution, it is only 4% of total revenue for the financial year 2023.
It said 92 vessels were booked for the financial year 2024 season, on a previous peak of 76 visits in financial year 2020. This season, 64 cruise ships docked at the port.
Container services were the biggest revenue contributor for the port at 57.2%.
In the annual report, chief financial officer Kristen Lie said the port’s balance sheet remains in a strong position.
“At the end of the financial year, Napier Port had $130 million in outstanding loans and borrowings, in addition to $50 million in undrawn credit facilities.”
Further in the report, it stated in early October, Pan Pac reopened its wood chip mill, the first part of its production facility to become operational again since the cyclone.
It expected timber mill operations to restart in January and the pulp mill in February, with the plant fully operational by late 2024.
Pan Pac has affected the Port of Napier operations significantly.
'Resilience'
Napier Port had minimal damage from Cyclone Gabrielle and the first container vessel was back in the port within one week.
However, extensive damage to its customers’ crops, exporters’ premises and regional infrastructure affected cargo volumes, which softened Napier Port’s overall trade volumes and financial results for the 2023 year.
“Despite the challenges presented by Cyclone Gabrielle, this year has reinforced the resilience of Napier Port, our region and the cargo owners who produce the food and fibre products that the world continues to demand.
“We are proud of the role we were able to play in the immediate response phase and the role Napier Port continues to play in the ongoing recovery.”
