'They'd' is short for 'they had', 'hit' probably means 'arrived at', and 'Port Stephens' is the name of a place. In other words, 'he could smell them coming from a long way away'.

In Australian vernacular "hit Port Stephens" means "arrived in Port Stephens", so the author is saying that her father could 'smell' them before they even arrived. He disapproved of them and sent them back home ('sent them packing').