The challenges of the past year that led to Gisborne Holdings Ltd’s board deciding they could not pay GHL’s council owner $2.5 million of anticipated income also seem to have helped unify their thinking. The directors didn’t appear to be entirely on the same page when GHL’s predicament was first outlined publicly at its AGM last year; at Thursday’s 2023 annual meeting there was clear unanimity.
That predicament is chiefly an owner that wants a steadily rising dividend stream to offset demands on ratepayers, and a portfolio of assets now worth $139 million that is poorly suited to delivering this.
Along with the impacts of Cyclone Gabrielle on GHL’s dominant asset, Tauwhareparae Farms, the board has undertaken a comprehensive review of its strategic position over the past year and has now delivered a draft five-year strategic plan to the council.
The board sees an opportunity to recycle capital into assets/rebuilding projects the community needs, potentially alongside iwi, Trust Tairāwhiti or Eastland Group, as well as investing in a managed fund that earns better returns than its current portfolio — a large farming operation, properties (mostly rented by Gisborne District Council), the Top 10 Holiday Park and the Wash’n Go auto wash.
GHL’s proposal put to the council is to review its ownership of all assets except the holiday park (5 percent of its assets by value). It expects the plan to be signed off in early November.
