Investment in Port Operations Paying Off

Media Release
12 September 2008

Annual Result – Investment in Port Operations Paying Off

CentrePort Limited has reported a strong normalised profit from trading of $11.4 million for the year to 30 June.

This was an improvement of $1.1 million on last year’s performance.

New chairman Warren Larsen said the result reflected solid contributions from CentrePort’s port and property operations.

“However, while property activity has made major contributions in the last two years, our port redevelopment strategy is providing very pleasing gains. This coincides with a quieter period within our property portfolio,” he said.

The port strategy included the purchase of the new tug, Tiaki, which was part of the continuation of the company’s asset refurbishment plan, aimed at maintaining the value and utility of CentrePort’s port and infrastructure.

“We also have significant other infrastructure developments underway such as replacement of the container terminal’s straddle fleet,” Mr Larsen said. “This investment will continue to strengthen port operations – it is an exciting time for the business.”

The $11.4 million normalised operating profit resulted from record container throughput of 91,638 TEUs and increased property rental income flowing from prior increases in property values.

However, a $0.5 million decline in investment property value (against an increase of $11.2 million in 2007) a $0.8 million reduction in the fair value of financial instruments ($2.1 million increase in 2007), one off gains of $0.4 million and tax expense of $3.5 million reduced the normalised profit to an operating surplus of $7 million.

Operating costs were a key management focus during the year and at $36 million, were comparable to 2007 levels.

A final dividend of $1.8 million was declared, taking total shareholder payments to $4.8 million for the 2008 financial year.

Mr Larsen said that while the period was quieter from a property point of view, there were still significant developments. These included on-schedule construction of the BNZ building in the Harbour Quays development and the announcement of the six storey New Zealand Customs Service building in Harbour Quays.

“Harbour Quays is continuing the vision of creating a high quality work and leisure environment within Wellington’s downtown commercial centre.”

Planning was well underway for the redevelopment of the 12 hectare CentrePort site at Seaview, a significant development for Hutt City, and linked to increasing trade volumes through the port.

ends

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