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Lyttelton Port annual earnings near bottom of guidance, dividends return in 2014

Thursday 29th August 2013

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Lyttelton Port Co, Christchurch's ocean-going trade hub, reported annual earthquake adjusted earnings near the bottom of its May forecast and down 5.3 percent from a year earlier.

The result reflected the port company moving beyond the business interruption indemnity period of its insurance contracts, but it expects to resume dividend payments next year as it recovers from the 2011 quakes that devastated the port along with much of Christchurch and nearby Canterbury towns.

Adjusted profit fell to $15.1 million in the 12 months ended June 30 from $17 million a year earlier, the company said in a statement. That was at the bottom of forecast earnings of between $15 million and $16 million, which was upgraded in May on a pick-up in its port services. Net profit fell 1.7 percent to $16.9 million, or 16.5 cents per share.

The port boosted revenue 5.8 percent to $110.7 million and earnings before interest, tax, depreciation and amortisation increased 2.8 percent to $35.7 million as it boosted total container volumes (TEUs) 4.5 percent to 351,217.

Dry bulk imports increased 11 percent, with a 42 percent rise in cement volumes and a 7.4 percent fall in fertiliser. Log exports climbed 31 percent and fuel imports grew 8.7 percent. Coal exports dropped 18 percent after Solid Energy suspended operations at Spring Creek Mine.

"The company is in a strong position to deliver ongoing business growth, while at the same time reinstating earthquake-damaged facilities and undertaking development projects to meet the demands of long-term growth," it said. "LPC sees further increases in container volumes, as primary produce and other exports grow, and as imports for the Christchurch rebuild continue to flow in."

The board didn't declare a dividend, having suspended them until insurance issues were resolved, but expects to start them up again in the first half of 2014.

The shares, which are 79.3 percent owned by the local government's Christchurch City, were unchanged at $2.70 today, and have climbed 35 percent this year.

The port's insurers paid $17.4 million in the year, taking total payments to $53.1 million. A further $1.8 million was paid after the balance date. It recognised $27.7 million as an insurance receivable as at June 30, representing claims for material damage, business interruption and contract works.

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