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Port of Tauranga profit rises 7%

By Jane Shanahan

Thursday 28th August 2008

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Port of Tauranga, which may revive merger talks with rival Ports of Auckland, posted a 7% gain in full-year profit on increased volumes of forest products.

Profit rose to NZ$42.1 million in the 12 months ended June 30, from NZ$39.3 million a year earlier, the company said in a statement today.

The results included a 25% increase in volumes at its container business, which the Auckland port company last week said it would be interested to buy. Tauranga hasn’t received a proposal from its rival though a full merger between the two companies “makes good sense.”

The company is “confident of maintaining earnings growth momentum in the face of global economic concerns,” chairman John Parker said.

Ports of Auckland broke off talks with Tauranga last year after the proposal was rejected by its owners. The two companies have considered merging their operations to cope with changing shipping trends, with transport companies preferring to visit fewer, hub ports.

Port of Tauranga shares are unchanged at NZ$7.15 and have outpaced the NZX 50 Index in the past four weeks, climbing 9% to the index’s 2% gain. In the past 12 months, the stock is little changed, avoiding the broader market’s 19% slide.

The company will pay a final dividend of 16 cents a share, boosting its annual payment by 14%.

Total trade in the latest year rose 7% to 13.5 million metric tons, the company said. Log exports rose 5%, timber by 14% and paper products by 9%. Export volumes of kiwifruit through the port rose 25%, steel rose 14% and grain by 94%. Dairy exports fell 40%.


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