STC attributes fall in profit to winding down of LNG project

 THE winding down of the PNG LNG project construction phase has had a major impact on the financial status of the Steamship Group of Companies, according to its last financial report.

There was a 22.2 per cent reduction in profit after tax and minority interests of K88.7 million for 12 months to last December compared to K114 million for the same period in previous year. Chairman GL Cundle said trading conditions slowed as anticipated last year as the stimulus provided by the construction phase of the LNG project came to an end.

“Weaker agricultural commodity prices and the stronger Kina took their toll on the non-resource sector of the economy which supports the vast majority of PNG citizens as well.”

He said the mid-year intervention by Bank of PNG added disruption and uncertainty to foreign currency transactions and created an additional cost burden for much of business community.

“The logistics businesses – Consort, Steamships Shipping, East West Transport and Pacific Towing – are early barometers of PNG’s economic health with their exposure to trade flows and resource sector development.

“2014 experienced slowing activity levels and critical focus for this year would be on reducing structural costs to enhance competitiveness.”

He said consort continued to suffer from severe congestion delays in Lae but welcomed the completion of first stage of Lae Tidal Basin which should remove this infrastructure bottleneck this year.