Port Otago will receive a dividend of more than $800,000 from arch rival listed Lyttelton Port of Christchurch (LPC), after LPC posted an improved $10.3 million after-tax profit yesterday.
Port Otago will receive a second-half dividend of $569,771, boosting the full-year dividend to $807,175, which equates to an annual investment yield of 2.73%.
Last year, Port Otago received $633,079 in LPC dividends and $977,000 the year before.
LPC, which booked a record 9.8 million tonnes across its wharves for the year to June 2008, up 9% on last year, realised an after-tax profit of $10.3 million, a 7.3% increase on the previous year's $9.6 million.
Earnings before interest, tax, depreciation and amortisation were up 17.8% from $94 million to $110.7 million.
In April 2006, Port Otago bought a 15.5% stake in LPC, now worth more than $35 million, effectively blocking Christchurch City Holdings Ltd's bid for a 90% stake, which would have led to a sale to foreign interests.
ABN Amro Craigs broker Peter McIntyre said yesterday the yield to Port Otago of 2.73% from its LPC investment was considered a low payout ratio for an infrastructure asset.
The results of LPC, South Port earlier in the week and Port Tauranga yesterday were all strong and, to date, they were "the stars of the port sector".
Contributing to their success was more container and car imports, plus higher than expected volumes of conventional cargoes, including bulk cargoes.
Mr McIntyre said, in line with the present buoyancy in rural Southland, Canterbury was also showing resilience and strength, as had the hinterland surrounding Tauranga.
LPC chief executive Peter Davie said growth was particularly strong in container volumes, up 9.8% from 228,284 to 250,657 TEUs (20-foot-equivalent containers) this year.
Both import and export trades have reported good growth in the past year and imports exceeded exports by 54% to 46%.
Imports rose 14%, buoyed by a dramatic increase in vehicle imports, up 29.7% to 39,691 vehicles in advance of the February 1 vehicle emission regulation changes.
The total LPC dividend is 5.1c per share, compared to last year's 4c per share.
Port Otago is due to deliver its full-year report in September.
