“The distribution business has also performed as expected.”
Regulated asset baseHe pointed out that because the transmission assets were part of the company’s regulated asset base, it was the regulator who determined the overall level of allowable revenue.
Eastland Port exported a record 2.3 million tonnes of logs, 28,000 more than the port’s previous record and 59,000 more than last year. The $13.76m recorded in operating profits within the port sector was up $700,000 on last year.
The port sector results also include Eastland Debarking, Northland Debarking as well as the company’s Cook Stores cold storage operation and Gisborne Airport operations.
Eastland Group invested heavily across the port segment, including the $12m expansion of Eastland port’s upper log yard, as well as a $2.5 runway reseal at Gisborne Airport
Taken separately, Eastland Port recorded an operating profit of $10.9m.
Mr Todd said all of the smaller units of the port segment all experienced operating results similar to or slightly better than previous years.
Mr Todd said the rise of port volumes from 2.2m tonnes in 2015 to 2.3m tonnes in 2016, represented an increase of
5 percent.
“EBITDA (Earnings before interest, taxes. Depreciation and Amortisation) for the port sector has gone from $18.2m to $19.5m, representing a 7 percent increase in EBITDA. This reflects greater performance and cost efficiency from the port team.
“Increased depreciation associated with new capital investment (upper log yard and tug boat) will reduce EBIT.”
Waihi Dam hydro lossesThere was a large fall in profit recorded in the generation sector due to the loss of generation from the Waihi dam hydro power station, which was out of action for several months. Operating profit across the sector fell from $5.65m to $1.92m, following a $2.78m fall in revenue over the year.
This year, the sector accounted for $9.5m of revenue compared to $12.28m the previous year. The value of group assets rose dramatically, from $386m in 2015 to $422.2m.
The company, wholly owned by Eastland Community Trust, was able to pay ECT a fully-imputed dividend of $5.6m — up $600,000 from the previous year — while interest paid on shareholder capital notes was down $500,000 to $2.1m.
Taken together, ECT was paid $7.9m, a rise of $300,000 from the previous year.
The record profit recorded this financial year was made while the company invested heavily in the district through $25.6m of investments here, in a total capital expenditure of $32.3m.
The company had also this year agreed to advance a $120m project to build a geothermal power plant near Kawerau.
Although the group now employed 110 people, 10 fewer than last year, its wage and salary bill rose an extra $485,000, to $8.67m. A total of 26 group employees now earned more than $100,000 a year — three more people than last year.
'Peak employees'Mr Todd pointed out employee numbers represented “peak employees”, not full-time equivalent positions.
“In terms of employee cost, the company has employed additional skilled individuals as a result of the Transpower acquisition, the Te Ahi O Maui geothermal project, and has also seen employee costs for the port increase. Port employee costs have increased due to directly employing some key positions in 2016.
“Our success is directly attributable to the quality of our team. This year the theme of our annual report is ‘Our People Make it Happen’, and we can say that because it’s true. We really do have wonderful people at Eastland Group. They go the extra mile when they need to, and they genuinely do make it happen. Our geographic as well as sector diversity means we spread the risk and impact of one-off events or challenges.
“As noted in the 2016 annual report: Our aspirations are ‘more of the same’. We want to continue to grow and we believe growth will come from within the same sectors in which we are currently operating. For us, success is first and foremost about commercial success that will directly and indirectly create real value for our whole community.”
