Port Of Tauranga Limited · NZX:POT
Port Of Tauranga — FY2022 Earnings Presentation
52 slides from Port Of Tauranga's earnings presentation, Aug 26, 2022
Slide 1: Presentation to Analysts
Presentation to Analysts 26 August 2022
Slide 2: Disclaimer
Disclaimer The information in this presentation is for information purposes and has been prepared by Port of Tauranga Limited with due care and attention. However, neither the Company, nor any of its Directors, officers, employees, contractors or agents, shall have any liability whatsoever to any pe
Slide 3: Highlights and Challenges
Highlights and Challenges For the year ended 30 June 2022
Slide 4: Group Net Profit After Tax up 8.7%
Group Net Profit After Tax up 8.7% For the year ended 30 June 2022 $120,000 $111,317 $110,000 $100,577 $102,375 $100,000 $94,273 $88,679 $90,000 $80,000 $70,000 $’000s $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 2018 2019 2020 2021 2022
Slide 5: Ordinary Dividends maintained at 90% of Net Profit After Tax
Ordinary Dividends maintained at 90% of Net Profit After Tax For the year ended 30 June 2022 14.7 14 13.3 13.5 12.4 12 10 Cents per share 8 Ordinary 6 Special 4 2 0 2019 2020 2021 2022
Slide 6: Revaluation of Property, Plant & Equipment
Revaluation of Property, Plant & Equipment Harbour Improvements $28.697 Wharves and Hardstanding $75.313 Buildings $4.753 Land $537.841 $0 $100 $200 $300 $400 $500 $600 $Millions
Slide 7: Net Debt / Net Debt + Equity
Net Debt / Net Debt + Equity For the year ended 30 June 2022 40% 35% 29.2% 30% 27.5% 25.5% 25% 20% 17.3% 15% 10% 5% 0% 2019 2020 2021 2022
Slide 8: Total Trade down 0.5%
Total Trade down 0.5% For the year ended 30 June 2022 30,000 26,946 25,738 25,615 24,458 24,808 25,000 20,000 Tonnes 000s 15,000 10,000 5,000 0 2018 2019 2020 2021 2022
Slide 9: Container Volumes up 3.4%
Container Volumes up 3.4% For the year ended 30 June 2022 1,400,000 1,300,000 1,251,741 1,241,061 1,233,177 1,182,147 1,200,831 1,200,000 1,100,000 1,000,000 900,000 800,000 TEUs 700,000 600,000 500,000 400,000 300,000 200,000 100,000 2018 2019 2020 2021 2022
Slide 10: Connecting New Zealand and the World
Connecting New Zealand and the World • Largest and most efficient New Zealand port. • Lowest carbon emission international supply chain. • 32% of all New Zealand cargo (tonnes) Port Export ( Tonnes M ) Import (Tonnes M ) • 36% of all New Zealand exports (tonnes) Tauranga Auckland 14953.85 1117.85 62
Slide 11: NZ's Largest Container Terminal
NZ’s Largest Container Terminal NZ Container volume by quarter 2011-2022 NZ Container Port Market Share Annual Volume 250,000 100.0% 200,000 80.0% 150,000 60.0% 42.5% 100,000 40.0% 24.8% 20.0% 14.3% 50,000 8.8% 6.3% 3.3% 0.0% Auckland Lyttelton Napier Otago Tauranga Wellington 0 2017 2018 2019 2020
Slide 12: Transshipment down 6.0%
Transshipment down 6.0% For the year ended 30 June 2022 400,000 349,343 350,000 337,183 303,284 301,062 300,000 282,860 TEU s 250,000 200,000 150,000 100,000 2018 2019 2020 2021 2022
Slide 13: Bulk Cargo up 0.5%
Bulk Cargo up 0.5% For the year ended 30 June 2022 Bulk Volumes 14,000,000 GRAIN 12,000,000 STEEL FERTILISERS 10,000,000 OTHER FORESTRY 8,000,000 PRODUCTS KIWIFRUIT 6,000,000 PROTEINS & FEEDS ALL OTHER 4,000,000 GOODS OIL PRODUCTS 2,000,000 LOGS 0 2018 2019 2020 2021 2022
Slide 14: Log Exports down 4.4%
Log Exports down 4.4% For the year ended 30 June 2022 8,000 7,063 7,000 6,276 6,339 6,058 6,000 5,544 5,000 JAS 000s 4,000 3,000 2,000 1,000 0 2018 2019 2020 2021 2022
Slide 15: Forestry Outlook
Forestry Outlook • Log price correction bottomed out – expect improvement through remainder of 2022. At wharf gate market (smaller forests, farm blocks etc) has been the most impacted during downturn. • Circa 65% Tauranga export volume from forest estate owners who manage a sustainable cut to genera
Slide 16: Direct Kiwifruit Exports up 8.8%
Direct Kiwifruit Exports up 8.8% For the year ended 30 June 2022 2,000 1,772 1,750 1,629 1,473 1,465 1,500 1,303 1,250 M3 000s 1,000 750 500 250 0 2018 2019 2020 2021 2022
Slide 17: Kiwifruit Outlook
Kiwifruit Outlook • Strong growth driven by Gold license release and orchards coming into production. • In 2022 there was a surprising drop in yields (likely weather related) and significant quality issues which will impact grower returns. • 2022 crop is now forecast at 171M trays compared to foreca
Slide 18: Direct Dairy Exports down 6.0%
Direct Dairy Exports down 6.0% For the year ended 30 June 2022 2,110 2,076 2,120 2,039 1,994 2,000 1,500 Tonnes 000’s 1,000 500 0 2018 2019 2020 2021 2022
Slide 19: Dairy Outlook
Dairy Outlook • Diary volumes forecast to be flat as NZ is at peak cow. • Conversion to more “ value add” products may have an impact of increasing export tonnage. • Strong commodity price remains although have come back from the March 22 heights. • There is a higher level of last season inventory o
Slide 20: Direct Meat Exports up 6.2%
Direct Meat Exports up 6.2% For the year ended 30 June 2022 500 450 439 411 414 400 352 350 289 Tonnes 000’s 300 250 200 150 100 50 0 2018 2019 2020 2021 2022
Slide 21: Meat Outlook
Meat Outlook • Historically tranship volume has been more than 50% of the total export meat volumes. 1,200,000.00 1,000,000.00 • Tranship volumes originating in both other 800,000.00 TONNES 600,000.00 NZ ports and offshore have decreased in 400,000.00 the past two years due to vessel rotation 200,00
Slide 22: Cruise Vessels
Cruise Vessels 120 114 107 107 100 95 86 81 80 Visits 60 40 20 0 0 0 2017 2018 2019 2020 2021 2022 2023 F 2024 F
Slide 23: MetroPort
MetroPort MetroPort rail volumes up 10% on PCP to 325,000 TEU. Current programme 92 trains per week.
Slide 24: Port Congestion
Port Congestion • Vessel schedules remain suspended in New Zealand. • 6 of 16 weekly container services can meet berth window in Tauranga ~37%. Add image • Proforma berth windows expected to be reinstated in Q1 2023. • Berth priority given to services on window in Tauranga. • Berth window reinstatem
Slide 25: Congestion Impacts
Congestion Impacts Total Vessel Calls 2018 - 2022 2000 1800 1600 1400 1200 1000 800 600 400 200 0 2018 2019 2020 2021 2022 Container vessels All Other vessels 170 less container vessels (22%) vs pre-covid FY 2019. 4.7% increase in vessel calls FY2022 vs PCP.
Slide 26: Congestion Impacts
Congestion Impacts • FY 2022 average container daily yard volume 15,403 TEU (FY21- 15,106 TEU ) (FY20- 10,610 TEU). • Yard intensity continues ~45% above pre covid levels. • Unlikely to improve until berth windows are reinstated. • Average vessel exchange increased 11% in FY2022 - (215-TEU) .
Slide 27: New Zealand Port Productivity
New Zealand Port Productivity NZ Port Net Crane rate NZ Port Vessel Rate 40 90 35 34.1 80 30 30.7 70 28.2 25 24.9 60 20 20.6 50 15 40 30 10 20 5 10 0 0 Auckland Lyttelton Napier Auckland Lyttelton Napier Otago Tauranga Wellington Otago Tauranga Wellington Source: FIGS, Ministry of Transport
Slide 28: Port Sector Labour Challenges
Port Sector Labour Challenges • Continued widespread labour shortages across the port sector. • Additional labour constraints due to seasonal illness and second omicron wave (June – August 2022). • Significant labour cost inflation across the port sector . • Urgent need to address immigration settin
Slide 29: 30 Years of Planning
30 Years of Planning • Berth extension development planned since RMA inception. • Included in 1996 Coastal Occupation Consent & 2003 Regional Coastal Environment Plan. • Restricted discretionary activity. • All proposed development within the existing Port footprint.
Slide 30: Current Consent Request
Current Consent Request • Consultation, detailed design and early contractor engagement commenced 2019. • Shovel Ready applied May 2020 - declined August 2020. • Fast Track application applied October 2020 - declined March 2021. • Direct referral route suggested from MBIE. • Consent and direct refer
Slide 31: Critical New Zealand Infrastructure
Critical New Zealand Infrastructure • July 2022 - Environment Court hearing date - TBC ~ March 2023. • Current container capacity 1.4M TEU, current volume 1.25M TEU. • 2-year construction period & 2.5 years capacity left TIME IS OF THE ESSENCE
Slide 32: Future Capacity
Future Capacity • New Tauranga berth extension. • Introduction of new electric Auto Stacking Cranes (ASC). • Full Terminal Buildout Capacity ~2.8M TEU. • Based on 2019 MOT National Freight Demand Study “high growth” rate 2.51%. • Circa 35 years capacity in Tauranga following terminal development. •
Slide 33: Enabling New Zealand's Export Trade
Enabling New Zealand’s Export Trade • ~70% of New Zealand’s Dairy trade (2.3M tonnes) • ~61% of NZ’s Meat exports (550K tonnes) • ~30% of NZ’s Export logs (6.7M tonnes) • ~85% of NZ’s Kiwifruit (530K tonnes) • ~ $30B in key export commodities plus many more • ~40% growth in Kiwifruit in next five ye
Slide 34: An Integrated Upper North Island Supply Chain
An Integrated Upper North Island Supply Chain
Slide 35: Bigger Ships = Lower Carbon Supply Chain
Bigger Ships = Lower Carbon Supply Chain ~28% saving in emissions CO2e calculations are based on a 20’ 15 tonne container shipped on a typical container vessel size of 3,000-4,000 TEUs (via Auckland) and 8,000+ TEUs (via Tauranga)
Slide 36: Coastal Shipping Supporting Big Ships
Coastal Shipping Supporting Big Ships Tauranga berth extension crucial to enabling coastal shipping Mode Grams of CO2 per tonne-kilometre Road 123.1 Heavy duty road 92.0 vehicles Rail 22.8 Coastal shipping 13.9
Slide 37: Terminal Automation
Terminal Automation • Progressing first stage of Terminal Automation. • Currently seeking proposals for Auto Stacking Cranes (ASC) from providers. • Expect vendor selection Q2 FY 2023. • Well established technology used globally.
Slide 38: Subsidiaries & Associates Net Profit After Tax down 16.2%
Subsidiaries & Associates Net Profit After Tax down 16.2% For the year ended 30 June 2022 $20,000 $17,840 $14,952 $15,000 $12,728 $11,885 000s $10,000 $5,000 $0 2019 2020 2021 2022
Slide 39: Profit down 13.9% to $7.527 million
• Profit down 13.9% to $7.527 million. • Break Bulk volumes down 17.6% with log volumes down 518,405 tonnes on the previous year. • Container volumes up 42.0% to 19,106 TEU.
Slide 40: Profit down 20.8% to $2.257 million
Profit down 20.8% to $2.257 million. Bulk trade volumes increased but offset by marine revenue being lower.
Slide 41: Profit of $0.492 million down from $0.782 million
Profit of $0.492 million down from $0.782 million in the prior year. Container volumes down 18.2% to 76,819 TEU.
Slide 42: Profit of $3.232 million down 7.7%
Profit of $3.232 million down 7.7% on the prior year. Impacted by lower generator hire revenue compared to the prior year and increases in operating costs.
Slide 43: Reported profit of $1.283 million vs $1.869 million
Reported profit of $1.283 million vs $1.869 million in the prior year. Prior year’s result included the profit on sale of Coda’s investment in TNX.
Slide 44: Ruakura Inland Port
Ruakura Inland Port Inland Port construction almost complete Due to open late 2022 (Waikato expressway opened July 2022)
Slide 45: Greenhouse Gas Emissions
Greenhouse Gas Emissions Scope 1, 2 and 3 emissions for POTL Kilograms of CO2e per tonne of cargo 60,000 2.00 1.80 1.75 50,000 47,661 1.80 44,691 1.63 1.63 1.62 43,464 Kilograms CO2e per tonne of 42,534 1.60 40,430 40,000 1.40 Tonnes of CO2e 1.20 30,000 cargo 1.00 0.80 20,000 0.60 0.40 10,000 0.20 0
Slide 46: Air Quality Initiatives & Improvements
Air Quality Initiatives & Improvements NEW WIND FENCING VISUAL WIND MONITOR ALARMS ENVIROMENTAL GRAB 35 31.80 30 28.26 26.67 25 PM10 (µg/m3) BULK HOPPER WATER MISTING 20 15 10 5 0 FY20 FY21 FY22 Figure 1. Mean PM10 concentrations measured at the BOPRC monitor ‘Railyard South’ during dry weather cond
Slide 47: Water Quality Initiatives & Improvements
Water Quality Initiatives & Improvements • Comprehensive stormwater monitoring. • Compliant with resource consent’s water quality limits. • Continuous improvement pathway.
Slide 48: Harbour Water and Sediment Quality
Harbour Water and Sediment Quality All mean values meets high conservation value guideline for heavy metal toxicants. All mean values meets slightly- S moderately disturbed systems guideline for heavy metal toxicants. All mean values meets highly disturbed W W system guideline for heavy metal W toxi
Slide 49: Sponsorship & Community Partnerships
Sponsorship & Community Partnerships Port of Tauranga Rescue Centre – Surf Lifesaving Eastern Enhancements of Mauao walking tracks BOP TECT Rescue helicopter winch Tertiary Scholarships via Turirangi Te Kani Memorial Nga Matarae Charitable Trust Pilot Bay Boardwalk
Slide 50: Parent Capital Expenditure 2019-2024
Parent Capital Expenditure 2019-2024 $100,000 $80,000 40,000 $60,000 25,000 $000s $40,000 45,000 45,000 $20,000 40,073 38,228 2,850 23,796 18,612 $0 2019 2020 2021 2022 2023F 2024F Ruakura Inland Port Terminal Southern Berth Extension
Slide 51: Outlook 2023
Outlook 2023 • Port congestion is expected to continue until berth windows reinstated ~Q1 2023. • Labour shortages a worsening problem across port sector. • Expect to handle about 1.270 million TEUs. • Log volume forecast circa 5.8M JAS FY23. • Earnings guidance to be provided in October at Annual M
Slide 52: THANK YOU
THANK YOU