Napier Port has reported a near 40% increase in interim net profit to NZD 12.8m ($7.95m) but has warned of an uncertain second half to the year.
The New Zealand company saw revenue rise by 7.5% to NZD 52.3m as increases in cruise and container volumes offset a decline in log volumes.
“Container services benefitted from the early repositioning of empty containers ahead of the peak primary export season,” Napier Port said.
Volumes rose 7.5% year-on-year to 135,000 teu, helping to lift container services revenues by 12.1% from NZD 27.6m to NZD 30.9m.
Even though the cruise season came to an abrupt and early end following the Covid-19 outbreak, cruise services' revenue for the first half was up 22.5% to NZD 4.2m.
“This reflected an increase in ship visits to 76 ships from 66 ships in the prior season, albeit short of the 87 ships we had booked,” Napier Port said.
Despite a strong first quarter in log exports, the port ended the half-year to March down 5% on the same period a year ago.
The impact of high Chinese log inventories were compounded by the Covid-19 outbreak and extended Chinese new year holiday, suppressing demand for log exports.
“Napier Port’s positive financial results for the half year stand in stark contrast to the significant challenges that we, the surrounding region, and the broader economy face as a result of the Covid-19 pandemic,” Napier Port chairman Alasdair MacLeod said.
“For most of the six-month period that these results cover, trade has been trending largely in line with the expectations set when we launched our IPO in August 2019.
“However, as the half year drew to a close, and Covid-19 infections both offshore and in New Zealand rose, the government imposed its state of national emergency and Alert Level 4 lockdown.
“It also became clear the pandemic and lockdown would have a material impact on our region and Napier Port’s financial result for the year.”
MacLeod said the future trade outlook and the timing of the revival of the cruise industry remains uncertain and is now dependent upon Covid-19 public health developments and the economic impact in New Zealand and key international trading markets, both in the short and longer term.
“Napier Port continues to engage with cargo owners to understand how Covid-19 trading conditions are affecting them and the expected outlook for cargo volumes through the port,” he said.
