Union Steam profit drops 56 per cent

Press, 11 October 1982, Page 29

Union Steam profit drops 56 per cent

PA Wellington Union Shipping Group. Ltd’s profit has dropped 56.1 per cent to $3,626,000, from the record 1981 profit of $8,265,000. with a dividend pavout cut bv a third from $3,000,000 to $2,000,000.

The chairman. Mr Peter Abeles. says in the annual report that the year to June 30 was full of promise at the outset. But as it advanced the effects of world economic recession on economies within the company’s area of trade, high costs of funds, and difficulties in the Australian waterfront industrial field, checked the progress of the company. These factors, together with a more intensive competitive environment.

resulted in a much reduced profit. Cargo volumes were slightly below those of the previous year.

However, there were significant changes in cargo flows, with a reduction in tonnages moving from Australia to New Zealand, and limited growth in cargoes moving from New Zealand to Australia.

"Operational costs continued to increase and bunker fuel prices continued to rise. The costs of labour and materials in maintaining fleet and ancillary operations increased, as did the cost of stevedoring services at all ports in which the group operates." Mr Abeles said.

The company withstood a

“spirited challenge" in the trans-Tasman trade but this was not without effect on group operations. One of the ships operating in competition to group interests was withdrawn during the financial year.

Mr Abeles said that the new container ship Union Nelson was purchased during the year without raising additional finance. Further substantial loan repayments are required to be met in the current year. Any additional borrowing has been arranged in NeuZealand and Australian dollars. Two interim dividends were paid during the year of 5 per cent and 3.3 per cent, making a total of 8.33 per cent.