News - PNG Ports Corporation Limited

PNG Ports announces profit of over K100 million

25 October 2024

PNG Ports Corporation Limited (PNG Ports) has announced a net profit of over K100 million, for the third consecutive year.

The State Owned Enterprise announced a total of around K110,053,586 as Net Operating Profit after Tax (NOPAT) for the 2023 fiscal year, showing positive growth, after recovering from the significant impact the COVID pandemic had on the entire maritime industry.

From this profit, PNG Ports has declared a dividend of approximately K27.5 million to Kumul Consolidated Holdings, for the 2023 fiscal year.

In 2021 and 2022, PNG Ports made profits of K102.6 million and K104.5 million respectively. Together with the 2023 profit, this represents a total of almost K320 million in profits over the past three years.

CEO of PNG Ports, Neil Papenfus, has attributed the 2023 profit to efficiency improvements and prudent financial management with regard to PNG Ports’ core revenue streams of wharfage, berthage, storage, pilotage and terminal leasing, as well as an increase in vessel traffic.

PNG Ports operates in a demand-driven industry where an increase in the demand for trade causes higher vessel calls and greater cargo volumes in and out of a port. However, PNG Ports’ overall capacity to generate a profit is impacted by its requirement to operate and look after its 12 Community Service Obligation (CSO) ports, which all run at a loss.

“These CSO ports,” says Mr Papenfus, “are essentially subsidized by the profitable ports of Lae, Port Moresby and Kimbe.”

“To continue to generate profits and simultaneously operate and maintain all 15 ports, PNG Ports is developing new revenue streams such as a Pilotage School, embarking on a program of process improvement and re-engineering, with plans to overhaul its IT system.
He said these initiatives would improve PNG Ports’ efficiency as well as customer experience, whilst positioning PNG Ports to meet the current and future industry demands.
Mr Papenfus, who took on the role of CEO in May, commended Chief Commercial Officer, Ian Hayden-Smart, who looked after the SOE, after the shock passing of late CEO, Fego Kiniafa, in 2022.

He also paid tribute to the late Kiniafa for the decisions made which were now producing results, and the guidance of the Board, as well as the management and staff for the hard work and commitment in PNG Ports’ ongoing profitability and success.

He added that the 2024 fiscal year had started off strong, with good results also expected as the SOE reviews its corporate strategies to strategically align itself to continue serving this nation.

PNG Ports pays dividend to KCH

25 October 2024

Kumul Consolidated Holdings has received a dividend of K27.5 million from PNG Ports Corporation Limited (PNG Ports) for the fiscal year 2023.

The dividend was made after PNG Ports declared a net operating profit after tax (NOPAT) of K110 million last year.

This is the third year that PNG Ports has declared a NOPAT of over K100 million.

Minister for State Enterprises, William Duma, who witnessed the presentation to shareholder, Kumul Consolidated Holdings, praised PNG Ports for being an asset to the country.

“Year in, year out, PNG Ports is one of our performing SOE’s that has seen consistent growth in declared profits and dividends,” Minister Duma said.

“I know this payment is the result of the company's good financial management and operating standards which should be emulated by other struggling SOE’s.”

In 2021, PNG Ports made a profit of K103 million and paid a total dividend of K51 million, while in 2022, K104.5 million was recorded in profits, paying a dividend of K26.13 million.

Minister Duma praised the board, management, and employees for continuing to generate results, adding that PNG Ports had doubled its results since 2018.

“The results seen here with PNG Ports is what we want to achieve under the SOE reforms that target improvements in operational performance and financial sustainability of SOEs, which in turn will lead to better service delivery,” he said.

He encouraged PNG Ports to maintain its credibility and prudent management, as the government looks to such entities to deliver services and produce higher returns for the country.

PNG Ports serves as the nation’s economic gateway, handling all of PNG’s total cargo exchange at its 15 ports. Many of these ports do not make money and are run under a community service obligatory arrangement, to provide the vital service of delivering goods to the people.

Guided by the 30 Year Infrastructure Master Plan, PNG Ports is currently on a drive to modernize its ports into fit for purpose facilities in preparation for future industry demands.

The project designs will incorporate climate change and seismic disaster resilience, with PNG Ports to self-fund most of the projects.

The Australian Government’s Australian Infrastructure Financing Facility for the Pacific, the Agence Française de Développement, European Investment Bank, and the European Union have also committed funding for various other projects.

PNG Ports urges locals to stop attacks on vessels

16 October 2024

PNG Ports Corporation Limited (PNG Ports) is calling on locals living within the port limits to refrain from attacking and robbing vessels at anchorage.

Chief Executive Officer of PNG Ports, Neil Papenfus, made the call in response to the rise in criminal activities on vessels anchored within the declared ports and harbors, particularly Port Moresby.

Tatana Awareness Mr Papenfus said the country’s economy depended on maritime trade and this was a serious threat to the maritime industry.

Supporting this, the PNG Water Police, Motu-Koita Assembly and the NCD Small Craft Registry Board have joined PNG Ports in an awareness campaign in villages within the port limits.

So far, the team has visited Tatana, Elevala, Baruni and the Vabukori communities to raise awareness on the impact of sea piracy and armed robbery on maritime trade and encouraged them to report such incidents.

A good mix of representatives attended the awareness, including community leaders, magistrates and church leaders, who said they were aware of the criminal activities, and would work together to cut down on future incidents.

Speaking during the awareness, Team Leader- Inspection and Enforcement of PNG Ports, Danny Wame, said collaboration was key to ensuring the ports and harbors are safe for business, and to stop these criminal acts for the greater good of the country.

“PNG Ports can only do what is in its jurisdiction such as formulating and implementing policies to combat these maritime security issues. With the support from our key stakeholders, local communities and the general public, we can effectively address these issues”, he said.

“The vessels that come into our country bring essential goods such as food, medicines and building materials and other essential items and we must take care of them.”

The NCD Small Craft Registry Board has also asked small craft owners and operators to register their dinghies before the end of the year, in line with the Small Craft Act 2011.

PNG’s ports ranked among the best in the world

30 September 2024

The operational performance of PNG’s two international sea ports - Port Moresby (Motukea) and Lae - have been placed in the top 50% of ports in the Oceania Region.

Both ports are owned and managed by PNG Ports Corporation Limited (PNG Ports), and operated by International Container Terminal Services Inc. (ICTSI) under a 25-year contractual agreement which began in 2017.

Motukea and Lae out-performed the ports of Melbourne, Brisbane, Port Botany, Adelaide and Fremantle in Australia, and New Zealand’s Otago Harbour, Napier, Tauranga, Auckland and Lyttelton port.

They were among the world’s 405 international ports compared in a report by the World Bank - “Container Port Performance Index 2023: A Comparative Assessment of Performance based on Vessel Time in Port”.

These container ports are critical to the global supply chains and essential to the growth strategies of any emerging economy, and Motukea and Lae ranked 289 and 326 respectively in the comparison.

The Report compared the total container ship time in port which is directly influenced by the quality or cranes deployed, and the speed at which the cranes operate.

According to the Report, high-quality container port infrastructure operating efficiently has been a prerequisite for successful export-led growth strategies, and countries that follow such a strategy will have higher levels of economic growth than those that do not.

The aim of the Report was to pinpoint areas that needed improving at container ports because the negative effect of poor performance in a port affects the global supply chain.

Container shipping services follow a fixed schedule with specific berth windows at each port of call on the route, therefore, port performance at one port could disrupt the entire schedule.

This, in turn, increases the cost of imports and exports, reduces the competitiveness of the country and its neighbouring countries, and hinders economic growth and poverty reduction.

CEO of PNG Ports, Neil Papenfus, welcomed the Report saying he was impressed with the ranking gained by Motukea and Lae, which were compared against the busiest and more modernised ports in the world.

He said this was the result of the ongoing investments towards greater efficiency at the two ports, in partnership with ICTSI over the last 7 years.

The agreement with ICTSI was aligned closely with the country’s estimated continued development and growth in the international trade.

ICTSI introduced ship to shore cranes which began operating in Lae last year, boosting efficiency and reducing turnaround times for vessels.

Electronic data interchange and reports, including invoicing and payments, are also being carried out electronically and in real time, compared to the traditional days of manually invoicing clients seven years ago.

Mr Papenfus said PNG Ports, with government support, will continuously develop the ports, guided by the 30 Year Port Master Plan, with investment into the pilotage sector.
“Our partnership with ICTSI will further boost plans to maximize the potential of both ports. Improvements to security have also been done,” he said.

PNG Ports also owns 13 other ports in Daru, Oro Bay, Alotau, Rabaul, Kimbe, Lorengau, Kavieng, Wewak, Vanimo, Aitape, Madang, Buka and Kieta. These ports are operated as part of the company’s community service obligation.

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