Lyttelton Port fronts up after market dive

By Chris Hutching

Friday 5th July 2002

Listed Lyttelton Port Company managing director David Viles refused to comment about the implications of losing container business to rival Port of Timaru until the Stock Exchange queried the company about a 17c dive in the share price mid-week to $1.64.

On Tuesday The National Business Review asked Lyttelton Port Company's Mr Viles about the implications for shareholders and he asked for time to consider the request for information. The next morning his public relations agent, Erin Jamieson, responded with an e-mail message saying, "Mr Viles is unable to comment today."

But within hours the share price had plunged nearly 10% and he was forced to supply the necessary information to the market surveillance panel and follow it up with an amended notice giving more details.

Port of Timaru's coup in diverting the weekly container business was revealed a couple of weeks ago in the New Zealand Property Investor which reported an announcement was in the offing about a major port development to cater for milk products from Fonterra's Clandeboye factory.

Early in the week the Maersk Sealand Shipping service confirmed that it would cease calling at Lyttelton in late August and instead would call at Timaru.

According to the information provided to the Stock Exchange by Mr Viles the loss of business equates to $3 million of revenue, less than 5% of total turnover and the share price fall was attributable to Maersk Sealand's announcement.

Meanwhile, Lyttelton Port Company is in negotiations with the combined unions on the waterfront over an expired collective employment agreement. The negotiations are understood to focus on around-the-clock labour flexibilities involving the container terminal to attract business from the new breed of P&O Nedlloyd super containers.

On a positive note, Lyttelton Port Company announced a 15-year, multimillion-dollar deal with Solid Energy, signed a fortnight ago.

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