Port of Tauranga lifts full-year guidance as volumes rise

Friday 11th June 2010

Port of Tauranga, New Zealand’s biggest export port, raised its full-year earnings guidance by as much as 11%, citing a “strong” increase in volumes. Shares of the company rose 3.8%.

Normalised net profit in the year ending June 30 will be $49 million to $50 million, chief executive Mark Cairns said in a statement. That’s up from an earlier forecast for profit to be similar to the previous year’s $45.2 million and the consensus of analysts of $47 million.

The upgrade is “as a result of the strong increase in volumes, particularly over the last quarter,” Cairns said.

Full-year net income, though, will include a one-time non-cash adjustment to income tax payable as a result of legislation announced in the Budget to reduce the tax depreciation rate on buildings to zero.

Actual tax payable won’t change until the 2012 year “with the additional tax payable due to the tax depreciation estimated to be about $400,000 a year,” the company said.

The increase in tax will be more than offset by the company tax rate reduction to 28% in 2011/12 which will reduce tax payable by approximately $1.5 million a year, it said.

Shares of the port company rose 25 cents to $6.80 and have fallen 5% in the past month, about matching the decline in the NZX 50 Index.

Government figures yesterday showed the terms of trade posted its biggest increase since the mid-1970s in the first quarter, driven by exports such as dairy products.

Businesswire.co.nz

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