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South Port New Zealand

By Dan Stratful (AFA)

Monday 6th August 2012

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South Port New Zealand (NZX: SPN ) is the southern most commercial deep water port in New Zealand, located at Bluff with its primary assets consisting of a 40 hectare man-made Island Harbour where its main port operations take place.

SPN also services Rio Tinto's New Zealand Aluminium Smelter via a dedicated wharf and causeway and SPN provides pilotage, towage, berthage and full marine services to international and coastal vessels including the southern fishing fleet. Southland Regional Council is the major shareholder.

SPN reported record annual tonnage of 2.69 million tonnes for the year to 30 June 2012 (FY12), and it has upgraded its forecast tax paid FY12 profit to between $5.8 - $6 million, up from its previous guidance of $5.2 - $5.5 million issued in February 2012.

The upgrade resulted from improved activity in both the containerised and bulk cargo areas in the 4th quarter of FY12 as the port saw increased volumes of woodchips, fertiliser, petroleum and stock food cargos and the result will also include a one-off gain of $270,000 from the sale of a surplus mobile container crane.

SPN is one of many utility companies on the NZX however the shares are thinly traded due to Southland Regional Council holding most of the shares.

Rumors of international oil and gas exploration in the Great South Basin off the Southland Coast, adds speculative appeal to the shares, as the Great South Basin is rumoured to be one of the biggest unexplored conventional oilfields in the world. However this is only a rumour and far from certain.

SPN has commenced due diligence for the purchase of the cold storage business of Southland Cool Stores Ltd located at Bluff and the due diligence is expected to conclude early September 2012. SPN is in the process of finalising its annual FY12 accounts which will be released to the market on 23 August 2012.

Status:  HOLD

SPN shares today traded at $3.10

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