‘Busy year’ for ECT
Having distributed a record $10.6 million to Gisborne community groups, Eastland Community Trust will tomorrow reflect on a year of action — with big plans for the coming year.
ECT, which owns Eastland Group and also operates Activate Tairawhiti, holds its annual meeting at the Waikanae Surf Life Saving Club at 5.30pm tomorrow to discuss its annual report.
ECT chief executive Gavin Murphy said it had been a “busy year” for the trust, which was now worth $333.4m in equity.
Over the year, the trust made record distributions of $10.6m to 103 community groups.
The trust finished the financial year with an increased net surplus of $18.9m, up $1.2m on the previous year.
“We started off the year embedding tourism and the economic development agency and ECT all together, and then as well as doing our work behind the wellbeing framework, it has been a busy year.
“The amount of activity coming out of ECT only seems to be increasing,” Mr Murphy said.
“Last year was the largest year for distributions and we’ve gone up on that again. So, it has been a highly successful year. Eastland Group continues to provide strong dividends to us, which allows us to do what we have.”
The new wellbeing framework would be implemented to distribute about $120m over the next five or six years.
Mr Murphy noted the trust’s investment into the Prime Wood Cluster Centre of Excellence, which comprised the Far East sawmilling operation and an optimised engineered lumber plant, run through a joint venture with Wood Engineering Technologies (WET), called WET Gisborne Ltd (WGL).
The trust had now invested $17m into the Prime site to date and had attracted $10m of private investment, along with a pledge of $19.5m from the Government’s Provincial Growth Fund. The site now employed 71 people.
Mr Murphy said much of this year’s investment, through a cash advance of $2.8m, was around deferred maintenance of the plant and to help cashflow.
That advance had since been turned into equity (a 10 percent stake) in Spectrum Group, which owns Far East Sawmill Ltd.
“This is about the region showing leadership and developing capacity to take logs and the supply change capacity of the people.
“I think it also shows the region is engaged in forward processing and I think that attracts others to the region.”
Mr Murphy said the involvement in the wood cluster should be seen as the trust investing in the start-up sector.
“That will have several twists and turns until we get to the final version of what works. We have taken a step back as we have supported Far East a little bit more as we recognise that this is a journey to get wood processing re-established and growing in the region.”
Mr Murphy said the investment was all about creating long-term jobs for the region, and the supporting economic effects of those jobs on the larger regional economy.
“We do have mechanisms and we do expect to recycle some of our capital — getting jobs and adding a whole lot of value-added to the local forest estate — and getting a return of that capital where we can.
“If we can deploy some of that money for WET and get three WET plants here, then you have 60 high-paying jobs here and WGL as the research and development centre of their national business, then I think that is a really good return.”
The trust was now in the process of re-aligning its existing distribution pools to suit the new draft wellbeing framework for distributions.
“We think, if we get this right, this piece of work will attract national and international attention and national and international funding. Particularly, where we can demonstrate a really good engagement with our community and find ways to implement it at a grass-roots level.”
Mr Murphy pointed out the trust’s economic development requirements were fully embedded within the wellbeing framework. A final version of this would be completed by the end of the year.
The trust’s Statement of Intent for the 2019-2020 year said the trust would this year actively invest capital and time to create and grow local businesses that enhance jobs and income levels. It would also fund, facilitate and support projects and organisations contributing to community wellbeing. It would also continue to manage the trust capital through a sustainable approach to income distribution and risk management.
This year would be a year of “bringing it all together”, Mr Murphy said.