Lyttelton hit by Solid Energy downturn
Listed Lyttelton Port Company expects a 17% decline in coal volumes from Solid Energy.
It is estimated the decline will equate to a $700,000 reduction in after tax earnings.
The port company has the largest coal-handling facility in New Zealand to cater for rail wagons which travel from the West Coast.
In happier times, the two companies struck so-called strategic agreements and Lyttelton Port went ahead with developing coal-handling facilities.
But Solid Energy’s large-scale downsizing, redundancies and mothballing some mines means the port is bracing for the effects of reduced coal trade.
Lyttelton Port is two-thirds owned by the Christchurch City Council, meaning the council will get reduced earnings and dividends that normally offset rates increases.
The port will provide the market with its forecast full-year result at its annual meeting on November 2.
The Lyttelton coal yard exported a record 2,447,968 tonnes last financial year.
The other player to be affected is KiwiRail, but the company has yet to make any announcements about its coal cartage.