Ports of Auckland has increased its profits despite its half-yearly throughput and revenue falling.
The company’s profit was up 9.5% in the financial half-year despite a 2.2% fall in revenue and a 3.3% fall in throughput.
Chief Executive Tony Gibson said: “The first half of the year has been anything but plain sailing. Global trade trends and shipping changes have affected container volumes. As a result, revenue has fallen slightly but profit is up due to lower costs, largely as a result of the timing of repairs and maintenance.”
Gibson continued: “Container shipping lines have been subject to intense competition in the New Zealand market with significant overcapacity resulting in unsustainable freight rates. There has been some route rationalisation with some lines deciding to depart the New Zealand trade. This has contributed to a decline in volume.”
The company expects this situation to continue into the second-half of the financial year and beyond.
Gibson said the company would respond by keeping its costs low by looking at automation. A decision on whether or not to proceed with a proposal to partially automate the container terminal will be taken by April 2016, after consultation.
Gibson also said the company was building a freight hub network “to squeeze costs out of the supply chain”. The company has developed its hub in Wiri, established a new Bay of Plenty hub and signed a conditional agreement to purchase land for a new hub in Waikato. These North island hubs are linked by rail. The company is now considering extending its network to the South Island.
A new wharf is being constructed at Fergusson Container Terminal, which is scheduled to be completed in early 2017 and will give the terminal a third berth. The company said this third berth was “much-needed”.