Port Nelson Delivers Its Budgeted $4.5 Million Dividend Despite A Challenging Year

Port Nelson Limited announces its 2024 financial year results, highlighted by a dividend of $4.5 million and initiatives that reinforce its commitment to sustainable growth and regional prosperity amidst challenging national and international trading conditions.

Hugh Morrison, Port Nelson’s Chief Executive, noted the importance of the Port delivering on its budgeted dividend each year, “Port Nelson’s purpose is to facilitate regional prosperity. Delivering a $4.5 million dividend for the benefit of our local community is a priority here at the Port, considering the positive impact it has on reducing rates for local ratepayers.”

The Port’s underlying (excluding one-off non-cash adjustments) Net Profit After Tax (NPAT) result was $6.2 million, down $1.5 million on last year. Cargo volumes ended at similar levels to last year, 3.2 million tonnes.

Hugh Morrison, Port Nelson’s Chief Executive, says that changes in the mix of cargo contributed to the lower profit result. “The Port saw three of its larger cargo types: logs, wine, and processed timber, experience lower volumes than the previous year. These reductions reflected the global pressures felt in the markets that Te Tauihu exports to.” The Port was also impacted by changes in the operations of shipping lines with the use of larger but fewer vessels and a reduction in equipment stored in Nelson, which had a negative impact on revenue. On the cost side, increased interest, foreign exchange movements, insurance and payroll costs had an impact.

Headline NPAT was $0.8 million, reflecting the impact of a non-cash $5 million depreciation adjustment resulting from a change in legislation related to the depreciation treatment of long-term assets. In addition, there was a $0.4 million devaluation of the property portfolio.

Despite the economic challenges, Morrison expressed pride in what has been achieved at the Port during the 2024FY. “Improvement initiatives have been delivered across all aspects of our business, including increased customer engagement and data sharing, improved safety systems, enhanced team engagement, strengthened community and iwi engagement, and the advancement of asset replacement and development projects that contribute to the resilience and growth of the Port."

“Good progress was made within the environmental space. The Port is on track to reduce carbon emissions by 67% by 2035, with emissions down 25% from 2019 levels,” says Morrison. The Port also produced its first Climate-Related Disclosures report based on the NZ CS 1 Standard.

Effective community engagement is important to the Port, and this was best reflected at the Port’s Open Day, the first in seven years, attracting over 3,000 visitors. Morrison emphasised the Port’s sponsorship program as a crucial part of its commitment to the community. “This year, the Port supported various initiatives across Te Tauihu, providing $113,000 in funds in addition to in-kind services and materials. Some of the organisations supported by the Port this year included the Cawthron Seagrass Project, Moananui, New Zealand Riding for the Disabled, and the Port Nelson Export Hub.” Additionally, the Port advanced its iwi and Māori Partnership Plan, offering cultural competency training to its leadership and committing to regular collaboration with iwi.

This year, the Port introduced revenue improvement initiatives and infrastructure charges to enhance profitability in the 2025FY and subsequent years, aiming to improve shareholders' return on equity. Capital investment of $20.7 million was made for projects including the Slipway redevelopment, the new electric mobile harbour crane, and the pilot launch.

In the upcoming 2025FY, Port Nelson will welcome a new CEO to the team, following Hugh's retirement in November 2024. Port Nelson’s Chairman, Paul Zealand, said, “Hugh leaves a legacy in the team at the Port, with improvements in the relationships with customers and stakeholders, and investment to lift operational and environmental performance he can be proud of”. Port Nelson looks forward to the completion of The Marlborough Inland Port, the Nelson Marine Precinct and the arrival of new infrastructure assets, including the new electric crane, pilot launch and marine travel lift for the slipway.

“We would like to acknowledge the Port Nelson team's work in this challenging environment. We also thank all our customers and those who have used the Port over the last year, and we wish you well for 2025,” says Zealand.

Highlights for the year include:

• Customers:
  • Increased technology: The development of new data-sharing technology solutions has assisted our exporters with real-time tracking of their products.
  • QuayConnect growth: QuayConnect assisted a record $25m of cargo movements during the year.
• Environment:
  • Decreased carbon emissions: Carbon emissions continued to decline, now down 25% from 2019 emission levels.
  • Continued investment in green technology: Successful completion of the first phase of the trial of hydrogen injection into large container moving equipment. This reduced fuel burn by more than 12% in the trialled machine.
• People:
  • Positive survey results: Surveys related to health and safety, and engagement resulted in approval scores higher than industry benchmarks.
  • Improvement initiatives: Safety initiatives focus on improving worker engagement, emergency response readiness, traffic management, vessel inspections prior to work, and port user coordination.
• Community:
  • Increased connection: Hosting over 3000 people at our Port Open Day enabled us to showcase the work and equipment used at the Port and connect with our local community. The Port continues to work with iwi to establish regular communications and engagements that support a sustained and trusting partnership
  • Support for Te Tauihu community initiatives: The Port also supported various community initiatives across Te Tauihu and provided $113,000 in sponsorship funds, in addition to in-kind contributions.
• Shareholders:
  • Infrastructure Development: Progress of critical infrastructure projects, including the Nelson Marine Precinct, Marlborough Inland Port and the purchase of New Zealand’s first electric mobile harbour crane.
  • Supporting the strengthening of Nelson’s City-to-Sea Connection: A signed Memorandum of Understanding between Nelson City Council and Port Nelson reflects both parties' commitment to working together to improve the city-to-sea connection.

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