Eastland Group rebounds
Gisborne-based infrastructure, energy and logistics company Eastland Group today announced another strong annual result.
Despite the impacts and uncertainty of the nationwide Covid-19 lockdown at the start of the financial year, the company finished the year on a high. Its business sectors — Eastland Port, Eastland Network and Eastland Generation — all performed well, with Gisborne Airport flight numbers bouncing back to pre-Covid levels.
In the 12 months to March 2021, Eastland Group earned $107.4 million in income and delivered $16m in profit.
That was slightly down on the previous year, when the company generated $18.5m in profit and recorded a record $111.7m in income.
They returned $10.1m to their sole shareholder, Trust Tairawhiti, for the benefit of local communities, down from a record $12.3m the previous year.
Shareholder equity continued to grow, with total asset value increasing to $750.8m, up from $670.4m the previous year.
Eastland Group chief executive Matt Todd said it was important to acknowledge the staff who contributed to these results.
“Thank you to our team, who continued to operate critical regional infrastructure efficiently, safely and profitably through a challenging 12 months.
“In any year these would be results we could be proud of, but when we consider that April 2020 saw New Zealand locked down due to Covid-19, with us all facing real uncertainty as to what would happen during the year, the results are even more positive.
“The reliable returns from the generation and network sectors underpinned a rapid recovery once the Covid-19 alert levels dropped, followed by the port sector roaring back to life.
“This solid performance will contribute to the long-term resilience and sustainability of our company, our shareholder and the communities of Tairawhiti.”
Eastland Port exported just under 3 million tonnes of cargo, setting new daily and monthly cart-in records in the process. This was despite the port being effectively shut during much of April due to the lockdown.
Another key milestone was gaining resource consent for stage one of the long-planned twin berth development, the largest and most significant infrastructure project for the port in more than a century. The port would continue to consult with hapu, iwi, customers, stakeholders and the community as stage one gets under way and as resource consents are submitted for stage two.
When both stages are completed, two 185-200 metre-long ships would be able to berth, load and unload at once.
“This will help support the forestry industry, the introduction of containerisation, and Tairawhiti's long term economic growth.”
A range of environmental initiatives, with a focus on further improving water quality were also under way.
Lines company Eastland Network delivered 284.3 GWh of power to nearly 26,000 consumers across 12,000 square kilometres.
As well as completing the total overhaul of their asset management plan, on 1 April 2021 they rolled out their first Time of Use tariff structure.
Eastland Generation's two geothermal power plants in Kawerau, along with the Waihi Hydro Scheme near Wairoa, continued to generate electricity — and income — throughout the Covid-19 lockdown and beyond.
It also progressed towards its strategic goal of 100MW of renewable generation by 2025.
The new Taheke Geothermal Project was awarded $11.9m from the government's Covid-19 “shovel-ready” fund. Early in the 2022 financial year Eastland Generation completed the purchase of the existing 26MW TOPP1 geothermal power plant, bought for $83m.
Mr Todd said another highlight was the official opening of Gisborne Airport's new terminal, the most sustainable in New Zealand.
“It was a unique collaboration with co-funders Trust Tairawhiti and Kanoa (the Government's Regional Economic Development and Investment Unit, formerly the PGF); mana whenua Ngai Tawhiri; consultant Karl Johnstone; and artists Sir Derek Lardelli and Tiopira Rauna.
“Architects Tennent Brown and Architects 44 were recognised for their work in the Te Kahui Whaihanga New Zealand Institute of Architects (NZIA) Local Awards.”
At a board level, Tony Gray retired by rotation and Jim Quinn and Candace Kinser were appointed as directors.
This year Eastland Group introduced its first sustainability policy and continued to work with Trust Tairawhiti to measure, report on and reduce emissions, as part of their Climate Leaders Coalition commitments.
“Together, we are supporting the transition to a low carbon economy,” Mr Todd said.
“Eastland Network have completed their three-year project to ensure Tairawhiti and Wairoa are fully connected with electric vehicle chargers, and are planning for the ‘electrification of everything' as consumers' power usage changes.
“With Eastland Generation, we are becoming a truly significant developer, owner and operator of renewable energy plants in New Zealand.
“Plus, we're actively exploring opportunities for renewable energy generation right here in our home region of Tairawhiti. We aim to leverage the returns on our out-of-region generation investments, and our specialist expertise, to assess the possibilities of locally situated solar, wind and waste-to-energy plants.
“We look forward to a Tairawhiti with the energy capacity and resilience to power a sustainable future.”
Also looking to the future, the trust and Eastland Group have agreed to undertake a review of the Group's capital structure.
“This decision was made jointly by both organisations as part of the trust's three-yearly ownership review of Eastland Group.”
The review would ensure Eastland Group had the best possible capital structure to meet its commercial objectives, and the needs of Trust Tairawhiti and its current and future beneficiaries. The review is in its preliminary stages.
“As the sole shareholder of Eastland Group, we acknowledge the company's strong financial performance that resulted in a $10.1m return for the trust,” said Trust Tairawhiti chairman John Clarke.
“It enables us to deliver on our strategic plan, Te Aka Rautaki Ki Te Tau 2026, which focuses on supporting community initiatives, future generations of Tairawhiti, economic development and also helping our communities to understand and apply our wellbeing framework, He Rangitapu He Tohu Ora.”