LPC suspends dividends with organising insurance claims

Wednesday 2nd March 2011

Lyttelton Port of Christchurch is deferring dividend payments until it gets insurance for assets damaged in earthquakes.

It today reported that trading net profit after tax rose 66.7% to $6.1 million in the six months to December 31 from a year earlier on a 12.6% rise in revenue. But after asset write-offs of $22.6 million for damage to port assets the company reported a net loss after tax of $10.1 million.

The port was pleased with the way it performed after the magnitude 7.1 earthquake on September 4 but it is still working on the ramifications of the magnitude 6.3 earthquake last week.

Volumes in the key container trade were up 10% on last year and coal volumes were up 47.5% . Log exports rose by 2.7%.

The cost of urgent temporary repair works after the September earthquake had been largely offset by insurance recoveries received to date.

Earnings before interest, taxation, depreciation and amortisation of $17.3 million were up 31.6% on last year.

The port carries insurance cover for restoring assets, along with business interruption insurance. It continues to work closely with its insurers on assessing the damage to its assets from the September 2010 earthquake, determining the appropriate steps for their restoration or reinstatement and to finalise its claim.

It will start talking with its insurers about damage from the February 22 earthquake and expects them to take some time.

"Due to the current situation following the recent earthquake, the impact on the full year profit is extremely difficult to forecast at this time," chief executive Peter Davie said.

The port is partly operational again.

The directors resolved to defer the payment of dividends until further insurance proceeds were received and the total financial impact of the earthquakes was known.

NZPA

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