Ngāi Tahu more cautious looking ahead as it posts strong profit

Thursday, 25 October 2018

Solid trading and a $190 million Crown settlement top up have underpinned the South Island tribe's financial performance over the past year.

Te Rūnanga o Ngāi Tahu chief executive officer Arihia Bennett and Ngāi Tahu Holdings chief executive Mike Sang announce the annual result.

Excluding the top up, the tribe's fishing, property, farming and tourism divisions posted a net profit of $150m, providing a dividend of $61m for cultural, social, and economic programmes for the 61,000 registered members.

Ngai Tahu Holdings chief executive Mike Sang said that after several years of unusual residential rebuilding in post-earthquake Christchurch he was adopting a slightly more cautious approach given indications of economic headwinds.

While housing demand and supply had equalled out in Christchurch, Ngāi Tahu Property had just sold its first house at its subdivision in Hobsonville, Auckland, Sang said.

One of Ngai Tahu's tourism businesses on the Dart River near Queenstown.

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The 30 investment properties worth $332m were fully leased, half of them to state tenants, he said.

Te Runanga o Ngai Tahu chief executive officer Arihia Bennett and Ngai Tahu Holdings chief executive Mike Sang at a press conference for the annual result.

The seafood division had posted its best result from high value sales of koura to China but had decided to quit mussel production because it lacked sufficient scale.

Sang said two investments had proved problematic - the Waikato Milking Systems joint venture with Tainui, on which a loss had been booked but not realised, and the Watson & Son manuka honey operation.

The second half of a $20m write off in the Watson & Son was posted in the accounts this year.

Sang said there had been discord over governance and operations with the joint venture partner but Ngāi Tahu had now taken over the production side and the other partner had taken the pharmaceuticals side.

Opening season for Bluff oysters off the vessel Nga Roimata oysters being processed at Ngai Tahu Seafood.

'It will be a two to three year journey to profitability. The company will be renamed Oha. We may look at aggregating more hives but don't expect high capital commitments,' Sand said.

The new chief executive of Oha is Nadine Tunley who was an inaugural candidate of the Manawa Nui governance training programme.

Te Rūnanga o Ngāi Tahu chief executive officer Arihia Bennett outlined the number of initiatives aimed at inter-generational renewal within the tribe.

They included assistance into home ownership rather than social housing, and housing for elderly Ngāi Tahu, Bennett said.

Te Rūnanga o Ngāi Tahu kaiwhakahaere, Lisa Tumahai, said the development of a climate change strategy and a kaiwhakahaere advisory group for freshwater management signalled Ngāi Tahu's commitment to the environment.

She highlighted the opportunities for tribal members to invest in the Whai Rawa matched savings scheme, which had grown to $72.3m, an increase of nearly $10m on the previous year, with more than 25,000 Ngāi Tahu members contributing.

Lisa Tumahai, Ngai Tahu kaiwhakahaere, giving a keynote speech at the recent launch of the Women of Influence Awards in Christchurch.

Tumahai said more than 60 per cent of whānau lived outside of the takiwā (tribal area), and it was important to find ways for them to engage.

More than 3000 whānau attended road shows held in 14 places in the North Island and Australia, and in November 2017 more than 5000 members joined to celebrate a biennial cultural festival.

While the trading net profit was lower than the 2014 and 2016 years, when the $190m is added in it results in Ngāi Tahu's highest ever profit after tax at $273.2m.

Te Rūnanga o Ngāi Tahu Group subsidiaries included Ngāi Tahu Seafood, Ngāi Tahu Tourism, Ngāi Tahu Property and Ngāi Tahu Farming all posted profits, while Ngāi Tahu Capital booked a $9m loss on the honey venture but an overall small net profit after accounting for other adjustments and revaluations.

Other initiatives was Tokona Te Pō Kia Tokona Te Ao, to foster tribal economies - $463,000 has been invested in supporting 90 start-up businesses with 63 of those now operational.

Profits were boosted by the sale of some Ryman Healthcare shares as they hit new highs, and from joint venture Go Bus increasing its market share.

Hilton Haulage was running smoothly and was a full service logistics operation but there were no plans to emulate globally-focused companies like Mainfreight, Sand said.

Ngāi Tahu Farming has yet to optimise its dairy and beef operations as reflected in the net operating surplus of $4.56m.

Dairy farming would be expanded at Eyrewell north of Christchurch across the Waimakariri River. But previous plans for a large dairy operation at Balmoral Forest inland in Hurunui, north Canterbury had been abandoned in favour of a trial beef finishing farm and orchards and blueberries, Sang said.

Ngāi Tahu Forestry had a strong year underpinned by carbon credits, and the forestry team had been brought in-house.

Ngāi Tahu Tourism undertook two key developments - the Earth & Sky project at Takapō with the support of the three local Papatipu Rūnanga, and the new All Blacks Experience at SkyCity in Tāmaki Makaurau in partnership with New Zealand Rugby.