SPN, NPH, POT: Port stocks to watch as NZ funding boosts coastal shipping

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SPN, NPH, POT: Port stocks to watch as NZ funding boosts coastal shipping

port stocks
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Highlights

  • The NZ government has committed significant funding for upgrading domestic shipping services, etc.
  • South Port New Zealand posts a steady half-year performance
  • Napier Port Holdings to pay an interim dividend next month

The New Zealand Government has announced an investment worth NZ$30 million for coastal shipping with an aim to improve domestic shipping services, enhance efficiency, upgrade maritime infrastructure as well as reduce emissions.

The said funding will help build a more competitive and sustainable coastal shipping sector across the country and is through NLTP, i.e., the National Land Transport Programme. Moreover, it will help address issues related to both domestic as well as global supply chains and those faced by the coastal shipping sector, among others.

With this overview, let us look at the three NZX-listed port stocks that can be considered.

 NZ port stocks- SPN, NPH, POT

Source: © Vectorpouch | Megapixl.com

South Port New Zealand Limited (NZX:SPN)

South Port New Zealand Limited is the country’s southernmost commercial deepwater port, offering a full range of cargo, container shipping and marine services.

Related Read: How are these 3 NZX transportation stocks doing in 2022?

The Company in its half-year report ended 31 March 2021 highlighted its steady performance. Its NPAT stood at NZ$5.9 million, and total bulk cargo volumes are in line with expectations. Also, the total cargo activity was recorded at 1,745,000 tonnes in comparison to that of pcp, where it was 1,720,000 tonnes.

Further, SPN’s warehousing operations continue to operate well despite facing COVID-19 impacts and ongoing disruptions related to the global container supply chain.

However, the Company anticipates its FY22 earnings to be in the range of NZ$9.7 million and NZ$10 million and expects to maintain a full-year dividend of 27 cps if FY22 profits are in the forecasted range.

At the time of writing on 25 May, SPN was trading flat at NZ$8.900.

Napier Port Holdings Limited (NZX:NPH)

Second on the list is Napier Port Holdings Limited, which released its HY22 report Tuesday.

The Company’s revenue clocked NZ$50.7 million and the reported NPAT stood at NZ$9.0 million, reporting a decline of 3.6% and 15%, respectively, representing lower trade volumes and a reduction in vessel calls due to challenges of supply chain and COVID-19-related disruptions.

Do Read: NPH & POT: 2 NZX port stocks to watch as borders open up

However, NPH will pay a dividend of 2.8 cps on 23 June with the record date being 10 June.

Napier Port Holdings maintains a positive trade outlook as demand for the region’s food and fibre exports remains strong and reaffirms its earnings guidance to be between NZ$38 million to NZ$42 million for the year to 30 September 2022.

At the time of writing on 25 May, NPH was rising 0.36% at NZ$2.810.

Port of Tauranga Limited (NZX:POT)

Last on the list is Port of Tauranga Limited, which holds investments in other NZ ports, marshalling and logistics companies.

A Quick Read: NPH & POT: A glance at 2 NZX port stocks

The Company provided financial assistance to certain eligible employees in connection with its Employee Share Purchase Scheme.

Financial assistance with respect to nearly 170,000 shares was provided and was allocated to employees at a 10% discount.

It is noted that the said financial assistance comprised interest-free loans with a minimum tenure of three years.

At the time of writing on 25 May, POT was dipping 0.48% at NZ$6.170.

Bottom Line

New Zealand's port companies have shown resilience despite facing challenges related to the global supply chain, labour shortages, rising inflation and shipping disruptions.

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