Port of Tauranga Ltd's shares rose 30 cents to $6.85 after the company increased its annual profit guidance and outlined how the Government's budget will affect its accounts.The company is signalling a $49 million to $50m normalised net profit after tax i
Port of Tauranga Ltd's shares rose 30 cents to $6.85 after the company increased its annual profit guidance and outlined how the Government's budget will affect its accounts.
The company is signalling a $49 million to $50m normalised net profit after tax in the year to June 30. It had previously said the result was likely to be similar to last year's $45.2m profit. The company said the current consensus among analysts was a $47m profit.
Chief executive Mark Cairns attributed the improved profit guidance to a strong increase in the volume of goods handled by the port, particularly in the last quarter.
Port volumes can be an indicator of economic activity. Port of Tauranga handles large volumes of exports for the forestry industry. The company reported log export growth of 31 percent when it reported an interim net profit after tax of $23.072m.
Mr Cairns said there will be a one-off non-cash adjustment of $11m to income tax to reflect the Government's move to no longer allow owners to depreciate buildings.
There will be no change to the actual tax payable until the year to June 30, 2012, when the additional tax payable will be approximately $400,000 per annum.
"This increase in tax will be more than offset by the company tax rate reduction to 28 percent in 2011/12, which will reduce tax payable by approximately $1.5m per annum," the company said.
Port of Tauranga announced in March that it was buying Tapper Transport. It said the acquisition was expected to be immediately earnings positive.
