Steamships Businesses Achieve Growth In Spite Of Challenges

by PNG Business News - May 09, 2022

Photo credit: JMP Securities

According to the company's 2021 annual report, Steamships' businesses were robust in achieving an overall revenue increase of 11% in 2021.

Chairman Geoff Cundle stated that the outcome was achieved despite the twin obstacles of a weak underlying local economy and the global consequences of the Coronavirus (Covid-19).

“Steamships’ hospitality group, Coral Sea Hotels, was deeply impacted by border closures and restrictions on domestic travel in 2020 but, after a slow start, it benefited from the demand for quarantine rooms in 2021,” Cundle said.

“Conversely, property occupancy and rental rates remained depressed throughout the year, and this will continue for several years as, without meaningful growth in the economy, there will remain an over-supply of units throughout much of Papua New Guinea.

“Our logistics businesses have adjusted effectively to the operational constraints caused by the pandemic and are responding to early signs of recovery inactivity. In summary, after a disappointing 2020, and notwithstanding the lingering negative impacts of Covid-19, 2021 saw an improvement in the group’s performance,” he said.

“It has been two years since the outbreak of the global Covid-19 pandemic and unfortunately the impact of the virus continues to be felt across all economies.

“Businesses have suffered from travel restrictions and a general reduction in demand for goods and services.

“Steamships has been no exception but has adapted well and I am pleased with the robust performance that has been achieved under difficult circumstances.”

Meanwhile, Cundle said Steamships continued to welcome the Government’s attempts to broaden the base of the economy and rebalance the allocation of benefits from resource projects.

“This is an important long-term strategic goal that should promote broader and sustainable economic growth and employment.

“We are encouraged by the progress in new resource projects with PNG-LNG moving forward and P’nyang under negotiation.

“Disappointingly, it appears that Wafi-Golpu and Pasca-A exhibit little immediate prospect for progress.

“Porgera mine in Enga remains closed. It is hoped that progress on all these projects, together with other initiatives, notably investment in improved infrastructure, will stimulate the economy in 2023 and beyond.

“Traditionally an election year boosts economic activity but in 2022 the increasing national budget deficit could constrain this stimulatory effect.”

 

Reference: The National (3 May 2022). “Steamships businesses report 11pc growth despite challenges”.



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