Port Nelson Annual Report 2007 (pdf)

2 0 0 7 A N N U A L R E P O R T

H I G H L I G H T S F R O M T H E 2 0 0 7 F I N A N C I A L Y E A R 

JULY 2006 

Blessing of the Fleet at Wakefield Quay marking the centennial of the Cut, 

1906-2006. 

Marine Operations Manager Roy Skucek joined our staff, completing the 

new line up of executives. 

OCTOBER 2006 

Cruise ship The World makes a port call - selecting Nelson as ‘clean, friendly 

and a little bit different’. 

NOVEMBER 

2006 

Paving of Brunt Quay completed. 

The One Gate in Carkeek Street became fully operational, centralising 

services and enhancing security. 

Capital structure of the company reviewed, resulting in a share buy back, 

delivering $25 million to the two shareholders, Nelson City and Tasman 

District Councils. 

DECEMBER 

2006 

Port Nelson Santa Parade marks the beginning of the festive season in 

Nelson city. 

FEBRUARY 2007 

Open Day drew crowds to the port for displays and tours of the 

operational area. 

MARCH 

2007 

Port call from HMNZS Te Kaha. 

Nelson Yacht Club celebrates 150 year anniversary. 

Achieved ACC tertiary accreditation. 

APRIL 


Tanker Taiko makes her last visit to Nelson before being withdrawn from 

service. 

Delivery of new Hyster hi-stacker, capable of lifting two empties at once. 

Lifting record set by Liebherr cranes with 5749 moves for the month. 

Paving laid in former TNL log yard near the port company office. 

MAY 


Port Nelson Blokes’ Day Out triathlon raced in wet conditions with 

high number of entries. 

JUNE 2007 

The derelict fishing vessel SZAP 5 left port to be scuttled in Cook Strait. 

2 

Record container numbers and cargo tonnes handled for a full 

financial year.

“During the Noise Variation process we have appreciated the support of many 

parties who understand and acknowledge the importance of the port to the 

wider community. It is pleasing to note this has come both from the business 

community and many private householders, including a large number of 

port hills residents themselves.” 

Martin Byrne, Chief Executive , Port Nelson Limited. 

R E P O R T C O N T E N T S 

Directors’ Report ..............................................................................................................................................................................4 

Chief Executive’s Report ...............................................................................................................................................................6 

Port Nelson in the Community ..................................................................................................................................................8 

Environmental Matters ............................................................................................................................................................... 10 

Port People ..................................................................................................................................................................................... 14 

Governance .................................................................................................................................................................................... 15 

Directors .......................................................................................................................................................................................... 16 

Financial & Trade Highlights ..................................................................................................................................................... 17 

Auditor’s Report ............................................................................................................................................................................ 18 

Statutory Information ................................................................................................................................................................. 19 

Statement of Corporate Intent ................................................................................................................................................ 21 

Statement of Financial Performance and 

Statement of Movements in Equity ....................................................................................................................................... 22 

Statement of Financial Position .............................................................................................................................................. 23 

Statement of Cashflows ............................................................................................................................................................. 24 

Statement of Accounting Policies .......................................................................................................................................... 26 

Notes to Accounts ........................................................................................................................................................................ 28 

Directory .......................................................................................................................................................................................... 35 

3

D I R E C T O R S ’ R E P O R T 

As Chairman of Port Nelson Limited I am 

pleased to report another encouraging 

result for the company during this past 

financial year. 

The net surplus after taxation and including 

unrealised investment property gains 

was $6.7 million, based around revenues 

that were some $2.4 million ahead of budget, with the associated 

operational expenses some $1.5 million higher than budget. 

The main factors behind the increased revenue were: 

• Higher than anticipated cargo volumes, particularly in the areas of 

logs, vehicles, dairy products and wine 

• A continued move towards further containerisation of cargo 

previously carried in break bulk form, such as sawn timber 

• A continued increase in property values, which then flowed through 

into higher rental income. 

The main areas of increase in operating expenses related to: 

• Plant hire and wages – offset by increased activity 

• Electricity charges – also offset by increased activity 

• Maintenance costs associated with the replacement of a crane winch 

gearbox on one of the Liebherr mobile cranes. 

former SSL Receiving and Delivery site required significant pavement 

improvements to deal with the increase in volumes being handled. 

This reflects the bigger picture that many of the paved areas within the 

port were not designed to handle the number of containers and heavy 

operating machinery that we now deal with. 

Aside from this work, the main investment was around the ‘One Gate’ 

project which saw us bring staff from three separate operational sites 

into the new facility based at the Carkeek St entrance. 

That this project was completed on time and under budget, was a 

credit to all concerned. We have also continued to invest in new plant 

with the purchase of a Hyster ECH forklift; and have continued to 

upgrade our IT systems, flowing on from other projects in this area in 

recent years. 

The other major area of capital expenditure in the year related to 

the buy back of buildings and operational land which had been 

leased or owned by third parties. This was required to meet both 

current operational requirements and to ensure we have suitable 

developmental options open to us in the future. 

C A R G O A N D S H I P P I N G 

Cargo volumes were the highest in the history of the company, 

the final figure of 2.644 million tonnes being some 89,000 tonnes 

ahead of budget. Log, vehicle, dairy and wine volumes were strong, 

although once again slightly offset by lower than anticipated exports 

of processed wood products and fruit. 

The strong dairy and wine volumes, coupled with the movement of 

greater amounts of sawn timber into containerised form, meant the 

number of containers handled through the port exceeded 70,000 TEU 

(Twenty Foot Equivalent Units) for the first time. The final figure of 

71,815 is more than 10,000 TEU ahead of the previous twelve month 

period. 

4 

O P E R A T I O N A L M A T T E R S A N D P O R T 

D E V E L O P M E N T 

Unlike recent years with significant investment in wharf upgrades and 

the purchase of a new pilot boat, 2006/07 was very much focussed on 

limited capital expenditure, mainly around pavement areas required 

for container operations. The areas adjacent to Brunt Quay and on the

P E R F O R M A N C E R E V I E W - P O R T N E L S O N L T D G R O U P 

2007 2006 2005 2004 2003 

2007 2006 2005 2004 2003 

Operations 

Financial ($ Millions) ...continued 

Trade (Millions of Cargo Tonnes) 2.644 2.522 2.623 2.564 2.458 

Container Throughput (TEU’s)* 71,815 61,455 57,144 51,128 44,632 

Dividends Declared (Millions) $3.9 $5.3 $3.3 $9.2 $3.1 

Vessel Arrivals (Over 100GT) 997 1,012 1,178 1,267 1,470 Capital Expenditure $4.0 $2.9 $7.3 $3.2 $2.9 

Total Vessel GT Calling (Millions) 9.0 8.6 8.4 9.2 9.7 Net Interest Bearing Debt $42.0 $16.5 $19.0 $16.5 $15.0 

Employees (FTE’s) 132 141 143 125 121 Total Tangible Assets $152.3 $149.6 $117.2 $114.2 $113.7 

Financial ($ Millions) 

Shareholder Return Metrics 

Revenue** $33.0 $29.6 $27.7 $27.6 $25.4 

Earnings per Share (cents) 26.5 22.1 17.0 21.3 18.0 

EBITDA *** $15.8 $15.3 $12.2 $13.8 $12.5 

Earnings Before Interest 

Dividend per Share(cents) 15.3 17.1 11.0 30.0 10.3 

and Taxation (EBIT) $12.2 $11.6 $9.0 $10.6 $9.6 Net Assets per Share $4.31 $4.14 $3.15 $3.12 $3.18 

Net Interest Expense $2.5 $1.5 $1.3 $1.0 $1.3 Equity (%) 67.9% 82.1% 80.6% 81.2% 82.0% 

Taxation $3.0 $3.1 $2.5 $2.9 $2.7 Return on Average Equity (%) 5.6% 6.1% 5.4% 6.6% 6.0% 

Net Surplus After Taxation**** $6.7 $6.9 $5.2 $6.6 $5.6 Return on Average Assets (%) 7.7% 8.3% 7.5% 8.9% 8.4% 

F I N A N C I A L O U T T U R N A N D D I V I D E N D 

The net surplus after taxation, including unrealised investment 

property gains, resulted in a return on average shareholders funds 

of approximately 5.6%. Dividends declared for the year will be 

$3.9 million. 

As was reported in late October of 2006, the Board of Port Nelson 

Limited recommended proceeding with a share buy back which saw 

a payment of $25 million being split between the two shareholders, 

Nelson City Council and Tasman District Council. 

This came as a result of a detailed review of the capital structure of 

the company, with the focus being to achieve a structure more in line 

with the port sector in general and to establish a level of shareholders’ 

funds that was more appropriate to the nature of the risks associated 

with the port’s business. 

As was mentioned in the 2006 Annual Report, the continued 

rationalisation within the shipping industry remains a challenge for us, 

as it is for many New Zealand ports. This was highlighted in the second 

half of the financial year with the withdrawal of the Maersk Asian (NZ1) 

service from Port Nelson. 

We continue to make all efforts to ensure Nelson remains an attractive 

port of call for overseas shipping lines but are also realistic, that as vessels 

get larger there are likely to be further changes to existing services, 

particularly for the smaller regional operations such as ourselves. 

I would like to thank the senior management and all staff for the 

excellent efforts over the last 12 months. 

Our Finance Manager Murray Win retired after a number of years with 

Port Nelson and there were also changes in directors’ positions during 

the year. 

Murray Sturgeon and Bob Dickinson, both long serving directors, 

resigned during the latter half of 2006 and we thank them for the huge 

contribution they have made to Port Nelson Limited over many years. 

They have been replaced by Bronwyn Monopoli and Tim King and we 

look forward to their contributions to the growth of the business in 

coming years. 

To the shareholders and fellow directors I thank you for your support 

and commitment over the past year. 

Nick Patterson 

Chairman , Port Nelson Limited. 

5

C H I E F E X E C U T I V E ’ S R E P O R T 

6 

C A R G O 

Volumes through Port Nelson for the year 

were the highest on record with logs, 

motor vehicles, wine and dairy products 

being particularly strong performers. 

Total throughput for the 12 month period 

was 2,644,000 tonnes, some 89,000 

tonnes ahead of budget and around 122,000 tonnes up on the 

previous year. 

Log exports for the year were 22,000 tonnes ahead of budget at 

636,000 tonnes and reflected the strong overseas demand for wood 

throughout the majority of the financial year. Imported motor 

vehicles (new and used) totalled 167,000 revenue tonnes as against 

a budget of 136,000 tonnes and dairy (21,000 tonnes) and wine 

(30,000 tonnes) also showed healthy increases on the figures twelve 

months earlier. 

Processed forestry exports were some 60,000 tonnes below budget, 

with fruit exports and fertiliser and cement imports also being slightly 

lower than had been anticipated. 

Container numbers significantly increased once again with 71,815 

TEU handled during that period as against 61,455 TEU twelve 

months earlier. 

This increase was on the back of a number of factors including the 

following: 

• Greater volumes of sawn timber being shipped in containers rather 

than in break bulk form, particularly to the Asian region 

• Increased wine and dairy exports through the port 

• A further increase in LVL and MDF products being loaded into 

containers. 

S H I P P I N G 

Vessel arrivals were marginally lower with 1,001 vessels calling during 

the year as against 1,012 the previous year. 

In late December the fortnightly Tasman Orient Line (TOL) service 

ceased calling on the back of the traditional cargo base for this 

service moving principally to containers and around the same time 

the monthly Indotrans break bulk service to the US also ceased. In 

mid June the regular Maersk relay service to Asia also ceased as part 

of a nationwide review of their feedering service where they chose 

to commence utilising transhipment operations with existing coastal 

operators. 

S T O R A G E / R E C E I V A L A N D D E L I V E R Y / 

Q U A Y P A C K 

The purchase of land previously leased by a third party on the western 

side of Hay St in the second half of 2006 enabled us to secure extra 

land for the storage of containers, which was urgently needed given 

the significant growth in container traffic. Space was particularly 

at a premium during the 2007 fruit export season and the efficient 

operation of the Container Yard and Receiving and Delivery (R & D) 

systems was a credit to all the staff involved in the cargo logistics 

division of the business. 

Our Quaypack division continues to go from strength to strength with 

its packing and unpacking operations. The growth of wood products 

moving into containers has certainly seen added demand for their 

services. 

In late 2006 our Cargo Team moved into the ‘One Gate’ facility on 

Carkeek Street. The completion of this project on time and under 

budget was a credit to all involved. The benefits of having all cargo 

staff in one area have been everything we had hoped for and have 

certainly assisted us during the busy peaks we experience from March 

through to June. 

S T E V E D O R I N G 

In late 2006 a review was undertaken of our Stevedoring division, 

Tasman Bay Stevedoring (TBS) to ascertain how we could improve the 

performance of what has been for some time a marginal business. It is 

fair to say that all stevedoring companies in Nelson have a reputation 

for high levels of service and efficiency of operation but historically this 

service has not attracted the returns available for similar operations in 

other New Zealand ports. TBS has since worked through various issues 

to achieve mutual benefits, where our major customers know they 

have longevity of service and at the same time TBS is assured of the 

return that makes it worthwhile staying in this line of work. A huge 

amount of credit must go to Chris Shand, Digby Kynaston and the TBS 

team who have worked so hard in meeting the targets laid down for 

them, and I also express my sincere thanks for the efforts of our Chief 

Commercial Officer, Parke Pittar, in driving this review process. 

E N V I R O N M E N T A L I S S U E S 

The Noise variation to the Nelson City Council Resource Management 

Plan was notified in early June this year and we expect to commence 

noise mitigation work on the affected properties in the coming 

months. While no solution will ever meet with universal support we

“We work in a hectic environment in the peak fruit season and can’t always stick 

to our plans. PNL staff understand our needs and allow for flexibility in working 

hours and cargo volumes. I really value the personal relationships we have built 

up over many years.” 

Hans Krabo, Logistics Manager, ENZA International. 

believe the variation in its current form offers a solution that all parties 

should be able to live with, and we remain committed to ensuring we 

do everything possible on an ongoing basis to keep noise created 

from port operations to an absolute minimum. During this process we 

have appreciated the support of many parties who understand and 

acknowledge the importance of the port to the wider community. 

It is pleasing to note this has come both from the business community 

and many private householders, including a large number of port hills 

residents themselves. 

The Environment Committee has continued to meet regularly over 

the last 12 months. Following on from the recommendations of the 

committee and our own board and management, the company 

was recently successful in gaining ISO 14001 certification for our 

environmental practices - the first major port in New Zealand to 

attain this standard. Special note should be made of the efforts of our 

Environmental Officer, Frances Woodhead, in driving this project to a 

successful conclusion. 

P L A N N I N G F O R T H E F U T U R E 

The withdrawal of one of the Maersk services in mid June highlighted 

the continued change apparent within the shipping industry in 

New Zealand and overseas. If there is one thing that is sure, it is that 

change will carry on for the foreseeable future. In 2001 P & O Nedlloyd 

announced the introduction of the 4100 TEU container vessels to NZ 

and Australia and now some lines are looking at bringing 6000 TEU 

vessels to this part of the world, which will in all likelihood result in 

fewer port calls and greater use of feedering services. 

At this stage we believe the short to medium term future for regional 

ports such as ours is one where there are a mix of direct callers and 

lines choosing to utilise feeder operations. The challenge for us is to 

ensure we have the facilities to handle those vessels, without over 

investing in infrastructure that will struggle to generate a reasonable 

return. 

A C K N O W L E D G E M E N T S 

I would like to once again express on behalf of myself and our 

Executive Team our thanks to the Board of Port Nelson Limited for their 

support and advice over the last twelve months and to thank our staff 

who have all contributed to another solid performance. 

As I have stated in previous years, I would also like to express our 

appreciation to the importers and exporters of the region for their 

support, and to the many shipping lines that PNL services. Your 

support is vital to our continued success. 

Martin Byrne 

Chief Executive, Port Nelson Ltd. 

7

P O R T N E L S O N I N T H E C O M M U N I T Y 

Export is the lifeblood of Nelson-Tasman and at Port Nelson we are 

aware of the vital role we play as the ‘region’s gateway to the world’. 

From forestry, seafood, fruit, wine and imports, the wellbeing of the 

region as a whole is intrinsically linked to Port Nelson in some way. 

The community ownership of Port Nelson Limited is reflected in the 

strong role the company plays in the region in sports, arts, community 

and business. 

We are one of the region’s largest sponsors putting over $150,000 a 

year into support for a number of events, groups and projects. This 

year we continued to develop partnerships themed around the youth 

in the community and saw excellent results - our funding of a coach for 

the Nelson Rowing Club has seen the squad win gold at the Mardi Cup 

and selected rowers competing for New Zealand in Beijing. 

We continued to build on the success of the entry level multisport 

event, the Port Nelson Blokes’ Day Out, with increased entries and 

a large contingent from our own staff; we are in our third year of 

sponsorship with the Tasman Makos as a First XV supporter of the 

combined Nelson Marlborough side. 

The third Nelson Port and Transport Industry Charity Golf Tournament 

was held in November, attracting a capacity field, and providing an 

opportunity for the industry to get together and raise money for the 

very worthwhile cause of sending the Nelson Special Olympic Squad 

to Beijing. 

Out in the streets of the city we maintain a high profile with support 

for the Port Nelson Santa Parade and the Port Nelson Masked Parade, 

which opens the Nelson Arts Festival every year. Drawing crowds in 

excess of 10,000 these are Nelson’s biggest participation events. 

The Port Nelson Trust helps a wide range of community groups. 

Over the past year funds were distributed by the trust to a range of 

sports, community and arts projects. 

In the business community our support for the Nelson economy 

continues as a key stakeholder in the Nelson Regional Economic 

Development Agency, a cornerstone sponsor of the Nelson-Tasman 

Chamber of Commerce and supporter of the Nelson Bays Educational 

Business partnership, with Infrastructure Manager Dick Carter chairing 

the Nelson Engineering Group. 

The amenities berth on Wakefield Quay is now home to the Nelson 

Coast Guard, provided free of charge by Port Nelson to support this 

vital service to the community, and we continue to allow public access 

for fishing in this area. 

8 Port Open Day, February 07.

Port Nelson’s support of the Nelson Marlborough Rescue Helicopter Trust ensures 

that our volunteers receive vital training in water rescue and winch operation. 

Our family of sponsors and the support of the community help provide a free 

dedicated air rescue service, on call 24 hours a day, seven days a week. 

Paula Muddle , Marketing and Communications Manager, Nelson Marlborough Rescue Helicopter. 

P O R T N E L S O N S P O N S O R S H I P S 

Community 

Outward Bound youth programme 

Port Nelson Santa Parade 

Richmond Santa Parade 

Motueka Hospital Trust 

Port Nelson Masked Parade 

Nelson-Tasman Rescue Helicopter 

Blessing of the Fleet 

Nelson Bays Youth Team Racing 

School of Music Winter Festival 

Mouteka Yacht & Cruising Club 

Brightwater Food & Wine Festival 

Port Nelson Trust 

Business 

Latitude Nelson 

Chamber of Commerce 

Fishing Association 

Nelson Bays Education Business Partnership 

Sealord Rescue Centre 

Marine Farming Conference 

Golfing Tournaments 

Wood Processing Association 

Nelson Engineering Cluster 

Sports 

Tasman Bay Rugby 

Nelson Rowing 

Port Nelson Big Bay Bike Ride 

Beach Volleyball 

Port Nelson Blokes Day Out 

Tasman Sports Awards 

Nelson Motor Cycle Racing 

Portions of the Port Nelson information panels at Wakefield Quay. 

9

E N V I R O N M E N T A L M A T T E R S 

This year saw a significant progress in our environmental efforts at the 

port, as we worked towards ISO 14001 Environmental Management 

accreditation. The international standard is considered to be the most 

stringent of all the accreditation systems available in New Zealand 

for environmental management, and Port Nelson is the first major 

New Zealand port to make the commitment to externally audited 

continuous improvement in environmental management. Our first full 

audit was held at the end of the financial year and the final certification 

was issued some weeks later. 

Reaching this point has meant having a long hard look at our existing 

environmental management plan against the framework prescribed 

by the standard. The Environmental Consultative Committee has 

guided the process, advising on priority of environmental impacts and 

contributing several of the new quantitative performance indicators. 

As in previous years we extend a grateful thanks to this dedicated and 

knowledgeable team of volunteers. 

Auditors will continue to visit us on a regular basis to ensure we are 

gathering information related to the meeting of our targets and 

checking that procedures are working as described by the system. 

I S O A C T I V I T I E S T H R O U G H T H E Y E A R 

Environmental Policy Statement updated . . . . . . . . . . . . . . . . . . July 2006 

Environmental Aspects Register and 

scoring developed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .August 2006 

Internal environmental team convened. . . . . . . . . . . . . .September 2006 

Staff training in auditing environmental 

management systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .October 2006 

Initial audit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . November 2006 

Baselines and performance targets reviewed . . . . . . . . . . February 2007 

Plastics, paper and cardboard recycling introduced . . . . . .March 2007 

Review of documents and record keeping . . . . . . . . . . . . . . . . April 2007 

First full audit, update of Environmental Management Plan . . June 2007 

I N D I C A T O R S O F P R O G R E S S 

Our performance indicators are provided in both actual units and 

in TEU (twenty foot container equivalent) to provide a measure of 

efficiency improvements. 

E N V I R O N M E N T A L M A N A G E M E N T P E R F O R M A N C E I N D I C A T O R S 

Aspect Indicator Baseline Baseline 

2005/6 2006/7 

Environmental Policy Percentage of new permanent employees receiving environmental induction 0 23% 

Fuel Fuel use (litres) per teu* of cargo handled. 8.34 (537,926 ) 8.08 (580,905) 

Power Electricity use (kw hours)/per teu of cargo handled 65.7 (4,234,445) 63.89 (4,591,509) 

Waste Waste generated per FTE **employee (m 3 ) 2.8 (397.5) 2.75 (363) 

Methyl Bromide 

Number of readings higher than the current OSH workplace standard 

(19/mg/m 3 ) in areas not cordoned off during fumigation or venting. 0 0 

Quantity of Methyl Bromide used at Port Nelson (tonnes) 2.491 2.286 

Noise Number of noise complaints 33 32 

Oil Spills Number of oil spills when bunkering 1 3 

Dust Number of dust complaints 8 9 

Codes of Practice Number of audit reports completed 7 13 

Number of non-conformances identified 6 7 

Number of non conformances resolved 5 6 

Continuous Improvement Number of targets reported on 4 15 

Number of new initiatives Not recorded 19 

Water Water use (m 3 )per teu (site use excl ships) 0.61 (39,478) 0.64*** (46,437) 

1 0 

* Twenty foot equivalent unit for 2005/6 = 64,455 for 2007/7 = 71,865 

** Full time equivalent employees 2006/7 132 

*** Increase due to water leak.

“Watching the SZAP 5 descend beneath the waves accompanied by a 

tremendous crashing was a strangely beautiful experience. Thanks to our efforts, 

no debris accompanied her sea burial. We can take some pride that in doing a job 

we did not ask for, we managed to make the best of it.” 

Frances Woodhead, Environmental Officer, Port Nelson Limited. 

E N V I R O N M E N T A L I S S U E S R E G I S T E R 2 0 0 6 / 7 

A total of 61 incidents were recorded. The increase is due to improved 

reporting following a review of the Issues Register code of practice, 

and the introduction of the land-based spill trailer. 

S Z A P 5 D I S P O S A L 

The most unusual environmental project for the year was the sinking 

of the SZAP 5, an abandoned but fully equipped 60 metre fishing 

vessel - an undertaking that gave a whole new meaning to the concept 

of ‘waste management’. 

Following a long history of trying to get the owners to take responsibility 

for the vessel and eventually securing the legal right to dispose of her, 

our attempts to sell the vessel or get her broken up for scrap failed. 

We had a liability on our hands, in a deteriorating condition, and in 

December 2006 filed an application to Maritime New Zealand for a 

permit for disposal at sea. Conditions of the permit included removing 

all floatable items and contaminants - no small task on a fully equipped 

32 berth fishing vessel. 

The long process began with securing loose asbestos, pumping off 

refrigerant used in the fish processing plant, removing diesel oil (for 

recycling) from 13 fuel tanks and bilges and disposing of part-filled 

drums of lube and other contaminants. In February, everything that 

could float was removed from the ship. Serviceable items were resold, 

unusual artifacts ended up on Trade Me and Nelsonians picked up 

quirky Russian bargains at a garage sale. Stainless steel, metal and 

even the bronze alloy propeller, were removed for recycling. 

Preparations for towing included fitting bilge pump sensors and selfpowered 

navigation lights. There was a long wait for suitable weather 

for the tow to the approved dumping ground beyond Cape Palliser in 

Cook Strait, a 2000 metre trench used as a munitions dump. Disposal 

of redundant vessels is becoming an increasing problem around the 

world. The development of facilities to recycle ships and consideration 

of their end of life during construction is required. The SZAP 5 was built 

in Klaypeda, Russia in 1978. 

The new land-based spill trailer. 

1 1

E N V I R O N M E N T A L M A T T E R S 

N O I S E M A N A G E M E N T 

Despite handling more containers we have had fewer noise complaints, 

which is encouraging. However, clangs caused by empty containers are 

still the biggest source of complaints, followed by ships’ generators. 

Vigilance in stevedoring practices and training is ongoing. This year 

several complaints related to a particularly large vessel, the Cosco 

Melbourne; managing this ship will be easier when wharf repairs have 

improved the workability of Main Wharf South. Another notable 

noisy incident was an oil tanker inadvertently setting off her fire alarm 

system in the very early morning. 

Discussions continued with Nelson City Council on solutions to protect 

residents from noise. Further information was provided by Port Nelson 

Ltd and the proposed variation to the Nelson Resource Management 

Plan has now been finalised for a public submission process. 

F U M I G A T I O N 

Numbers of shed fumigations remained the same, with a total of 12 

over the 2006 summer season, when fumigation of export timber 

to Australia is required. Additional health and safety monitoring 

was done, to help identify changes that may be needed to current 

operating practices. 

The Nelson Air Quality Plan suggestion that fumigation at Port 

Nelson be subject to resource consent remains under review. Some 

progress was made through mediation between the operator and 

the submitters, but no compromise was reached and a decision by an 

Environment Court judge is awaited. 

D R E D G I N G C O N S E N T R E N E W A L 

Work has been underway to prepare an application to renew the port’s 

maintenance dredging consent. Over 277,204 m 3 of sediment are 

1 2

“When the topic of Environmental Management systems came up at the 

environment committee meetings we were able to indicate the benefits of 

having an externally audited system and to share our experience, as Nelson Pine 

Industries and TNL were both already ISO 14001 certified.” 

Philip Wilson, Environmental Engineer, Nelson Pine Industries. 

Port Nelson Environmental Committee. 

carried down the region’s rivers and into Tasman Bay each year. Some 

of this ends up in the channels and berth pockets making dredging an 

essential annual task. 

Dredging has been done since the early 1960s and careful study 

of the impacts of the activity are part of the stringent monitoring 

requirements of the existing resource consent, granted for 15 years in 

1993. The results show no negative effects at the dumping ground and 

have given us the confidence to apply for a 35 year consent, again with 

careful monitoring conditions and a review period. 

H A Z A R D O U S W A S T E S 

Certification to comply with the new requirements under the 

Hazardous Substances and New Organisms regulations was confirmed 

in August 2006. 

L O O K I N G A H E A D 

Investing in ISO 14001 certification has improved the frameworks we 

have in place. Over the coming year the focus will move from systems 

to action, as we make progress in the targets set for noise, waste 

minimisation, energy consumption and oil spill prevention. 

In the key area of noise we intend to make offers of insulation to the 

first 11 houses in the affected noise zone, by July 2008. Under the terms 

of the Noise Variation we will also establish a noise liaison committee; 

and budget provision has been made for reduction of noise at source. 

The new code of practice for fumigation will help to ensure that we 

continue to lead in minimising the risks associated with this aspect of 

cargo handling, as exporters address quarantine regulations imposed 

by overseas countries. 

Everyone’s contribution is vital to waste reduction initiatives. 

1 3

P O R T P E O P L E 

1 4 

Port Nelson has a proud track record of a stable and skilled workforce, 

with staff numbers steady over the past year with 93 permanent, fixed 

term and part-time staff. Casual staff boosted the total hours worked to 

the equivalent of 132 full-time equivalents. This year three staff members 

reached the milestone of 25 years service bringing the total number of 

‘silver servers’ to nine, one of whom has clocked up 44 years service. 

H E A L T H A N D S A F E T Y 

Port Nelson values its reputation for speed and efficiency in vessel 

turnaround, but never at the expense of compromising the safety 

of staff and on-site contractors. The Health and Safety Committee’s 

‘bottom up’ approach encourages input and suggestions from all 

staff members and ensures buy-in to safe working practices. The 

committee has been operating now for over 17 years and represents 

employees from all worksites within the port, as well as the CEO and 

three members of the Executive Team. 

L I F E S T Y L E P R O G R A M M E S 

A range of health checks are offered to staff. All permanent staff and 

some casuals have their hearing and vision checked annually by an 

occupational health provider. Identified employees in certain work 

areas are given lung function tests and some employees have regular 

blood tests to detect substances such as heavy metals or fumigants. A 

new initiative this year was ergonomic assessments for all the forklift 

drivers in the Cargo Logistics division. 

In 2006 we trialled a ‘Health and Wellbeing’ programme, where all 

permanent staff and qualifying casuals could claim $500 to improve 

their physical health, educational and personal development or 

emotional wellbeing. There has been an excellent uptake with staff 

applying to spend their wellness dollars on such items as gym 

memberships, computer equipment, tramping gear, massage therapy, 

life coaching, night school fees and bicycles. 

For several years we have undertaken pre-employment drug tests for 

permanent and casual staff; as well as ‘incident and reasonable cause’ 

drug and alcohol testing, to further enhance workplace safety standards. 

In early autumn each year we offer free ‘flu injections’ to all permanent 

staff, and in late spring staff are offered a melanoma skin check at an 

on-site GP clinic. Other Sun Smart measures are the provision of hats 

and sunscreen to outdoor workers. 

Our Employee Assistance Programme continues to support staff with 

counselling services for work or other matters. This service is offered 

to employees at no cost by a contracted professional organisation. 

We have a subsidized medical insurance scheme in place, we continue to 

offer a number of retirement seminars each year and we offer companysubsidised 

superannuation schemes for all permanent waged staff. 

L O S T T I M E I N J U R I E S ( L T I ’ S ) 

We are pleased to report a small decrease in LTI’s over the past year, 

down from twelve to nine. Our target LTI frequency rate of 1.5% was 

not met, with an end of year result of 3.27%. A port is a workplace with 

inherent dangers and the potential for ‘human error’. Any accidents 

are thoroughly investigated and new safety measures are added to our 

prevention programme where necessary. We remain committed to our 

long-term company goal of ‘Together towards Zero’ (LTI’s). 

A C C I D E N T C O M P E N S A T I O N 

Port Nelson Ltd is an Accredited Employer in the Work Safety and 

Management Practices Programme, and successfully met the tertiary 

level for the first time when we were audited in early 2007 - an 

achievement that gives us a great sense of pride and accomplishment. 

We continue to be a ‘reimbursing employer’ and we value the ability to 

have employees remain on the payroll system with all wage and salary 

deductions continuing without interruption. 

S U P P O R T I N G S T A F F E N D E A V O U R S 

The number of sports events that we compete in as a company is 

growing. In May a large staff team competed in the third Port Nelson 

Blokes’ Day Out, with a social event to follow; and we supported 

female staff to enter the Taylors’ Women’s Triathlon. Staff were helped 

to attend out of town representative sports events and to support 

local sports clubs and teams. Staff were also given support to attend 

professional and personal development courses. 

C O M M U N I C A T I O N 

All staff receive the company magazine RePort Nelson, which includes 

the ‘Safe Harbour’ feature, with a focus on health and safety matters. 

Safe Harbour includes the results of a scheme that rewards staff 

who report ‘near misses’ by putting them in a draw for a night 

out at the movies complete with a café voucher. This year we 

introduced an internal newsletter with input from all departments. 

This has been well received and covers a wider range of subjects 

- from new machinery to the results of sports’ sweepstakes. 

Summaries of monthly incident reporting are regularly posted on staff 

noticeboards along with safety messages. We have had good feedback 

on the noticeboard at the port gate, which records the number of days 

since the last lost time injury.

“I’m proud to work for a company that takes good care of its people and provides 

an all-round engaging, stimulating, positive work environment. 

There are challenges, but our people are the heart of the company - we’ve got 

strong social networks and we have fun!” 

Karen Barnett, HR & Quality Manager, Port Nelson Limited (left) 

with team members Jim Lane and Suzanne Thompson. 

T R A I N I N G 

We undertook organisation-wide training with a management 

consultant at the end of 2006, with the aim of improving our internal 

communications and enhancing our workplace culture. The staff 

newsletter was one result and we also went through a ‘starfish’ 

exercise, where staff were challenged to come up with a six week 

project that would make a positive difference in their work area. There 

have been ongoing updates for forklift drivers, first aid certification 

refresher training, seasonal induction for casual staff, and staff have 

also attended business, administration, supervisory, legal compliance 

and administration courses throughout the year. Marine staff have 

been to Launceston in Australia for port simulator training, senior staff 

have been supported in tertiary study in commerce and engineering, 

and we have continued to send two staff members per year to the 

Outward Bound eight day ‘Navigator’ course. 

G O V E R N A N C E 

The Finance and Risk Committee and Remuneration Committees met 

as required by their respective Terms of Reference and have been 

effective in terms of dealing with matters that may not warrant full 

Board attention. Both committees report to the Board. 

D I R E C T O R C H A N G E S 

During the year two well known directors retired, Messrs Dickinson and 

Sturgeon. Mr Dickinson had served on the Port Nelson Board for 12 years 

and Mr Sturgeon 16 years. In September 2006 Mr Sturgeon was replaced 

by Bronwyn Monopoli and in December Mr Dickinson was replaced by 

Tim King. Ms Monopoli is a Nelson based Chartered Accountant and Mr 

King Deputy Mayor of Tasman District Council. Both new Directors bring 

considerable complementary experience to the Board. 

B O A R D A N D S U B C O M M I T T E E C O M P O S I T I O N 

A S A T 3 0 J U N E 2 0 0 7 

Board 

Nick Patterson (Chair) 

Phil Lough 

(Deputy Chair) 

Tim King 

(Deputy Mayor Tasman District Council) 

Paul Matheson (Mayor Nelson City Council) 

Peter Schuyt (CFO NZ Post Group) 

Bronwyn Monopoli (Principal – Bronwyn Monopoli Chartered 

Accountants) 

Finance and Risk Committee 

Peter Schuyt (Chair) 

Bronwyn Monopoli (Director) 

Martin Byrne (Chief Executive Officer) 

Parke Pittar (Chief Commercial Officer, Company Secretary) 

Remuneration Committee 

Nick Patterson (Chair) 

Phil Lough 

(Director) 

Meeting attendance 

Meeting type Board Finance and Risk Remuneration 

Meetings held. . . . . . . . . . . 11 . . . . . . . . . . . . . . 3 . . . . . . . . . . . . . . . . . .1 

B Dickinson* . . . . . . . . . . . . 5 . . . . . . . . . . . . . . . 2 . . . . . . . . . . . . . . . . . . 

T King*. . . . . . . . . . . . . . . . . . 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 

P Lough. . . . . . . . . . . . . . . . . 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1 

P Matheson* . . . . . . . . . . . .10 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 

B Monopoli . . . . . . . . . . . . . 7 . . . . . . . . . . . . . . . 1 . . . . . . . . . . . . . . . . . . 

N Patterson . . . . . . . . . . . . . 11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1 

P Schuyt . . . . . . . . . . . . . . . . 11 . . . . . . . . . . . . . . 3 . . . . . . . . . . . . . . . . . . 

M Sturgeon . . . . . . . . . . . . . 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1 

* Attendance includes any meeting attended by alternates. 

F U R T H E R G O V E R N A N C E P R O G R E S S 

During the year a Delegated Authorities Policy was developed. The 

policy’s aim is to ensure there is appropriate control over expenditure 

limits and provide for delegation when key Authorised Signatories 

may be absent. The policy brought together some existing policy 

directives in addition to allowing for a review of best practice as it 

related to Port Nelson Ltd. 

Additionally, in September 2006 the Risk Framework was finalised 

providing management and the Board with an up to date risk profile 

related to Port Nelson’s specific risks. 

At the end of the Financial Year the final stages were being completed 

on an updated Fraud Policy, thus ensuring that an appropriate 

framework is in place to manage any suspected fraudulent events 

should they occur. 

Port Nelson’s Governance Framework continues to be reviewed and 

enhanced where appropriate on an annual basis. 

1 5

D I R E C T O R S 

N I C K P A T T E R S O N 

Nick is the Managing Director of Wai-West Horticulture Ltd, which has extensive 

horticultural plantings and post harvest facilities. Wai-West manages Fruit Logistics 

(Nelson) Ltd, providing coolstorage and associated services for around 25% of the 

Nelson pipfruit industry. 

P A U L M A T H E S O N 

Paul is the Mayor of Nelson City and an experienced business manager. 

His ex officio positions include directorships of Nelson Airport Ltd and Trustee of 

Cawthron Institute. He chairs the nationwide Mayors’ Taskforce for Jobs and is actively 

involved in many wider community organisations. 

P H I L L O U G H 

Phil is currently Chair of NZ Trade & Enterprise and a range of other NZ companies. 

He was previously CEO of the Sealord Group and is based in Nelson. 

T I M K I N G 

Tim is Deputy Mayor of the Tasman District Council and chairs their Corporate 

Services committee. He farms on the Waimea Plains and has governance roles on a 

range of community organisations including chairing the Waimea Rural Fire 

Authority and the Wakefield & Community Health Centre Trust. 

P E T E R S C H U Y T 

Peter is Chief Financial Officer for the New Zealand Post Group. He is also a director of a 

number of companies in that group. Prior to his current role, Peter was CFO of the New 

Zealand Dairy Board. 

B R O N W Y N M O N O P O L I 

Bronwyn is a chartered accountant, with her Richmond based practice 

providing specialist accounting and financial advice to mainly rural businesses. 

She is also a director of a number of Crown and other companies, and a trustee of 

various arts-related organisations. 

1 6

F I N A N C I A L R E P O R T 2 0 0 7 

FINANCIAL HIGHLIGHTS 

2007 2006 

$Millions $Millions 

Revenue $33.0 $29.6 

Net Surplus After Taxation* $6.7 $7.6 

Dividend $3.9 $5.3 

Basic Earnings per Ordinary Share 26.5¢ 22.1¢ 

Return on Average Shareholders’ Funds 5.6% 6.1% 

Net Asset Backing per Share $4.31 $4.14¢ 

Dividend - Recommended per Share 15.3¢ 17.1¢ 

Return on Average Total Assets** 7.7% 8.3% 

Ratio of Shareholders’ Funds to 

Total Assets 67.9% 82.1% 

TRADE HIGHLIGHTS 


Cargo Tonnes 2.64M 2.52M 

Vessel Arrivals 997 1,012 

Container Throughput (TEU’s) 71,815 61,455 

* Including Investment Property Revaluation 

** Based on EBIT 

1 7

AUDIT REPORT 

TO THE READERS OF PORT NELSON LIMITED’S FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007 

The Auditor-General is the auditor of Port Nelson Limited (the company). The Auditor-General has appointed me, Scott Tobin, using 

the staff and resources of Audit New Zealand, to carry out the audit of the financial statements of the company, on his behalf, for the 

year ended 30 June 2007. 

Unqualified opinion 

In our opinion: 

• The financial statements of the company on pages 22 to 42: 

- comply with generally accepted accounting practice in New Zealand; and 

- give a true and fair view of: 

• the company’s financial position as at 30 June 2007; and 

• the results of its operations and cash flows for the year ended on that date. 

• Based on our examination the company kept proper accounting records. 

The audit was completed on 10 September 2007, and is the date at which our opinion is expressed. 

The basis of our opinion is explained below. In addition, we outline the responsibilities of the Board of Directors and the Auditor, and 

explain our independence. 

Basis of opinion 

We carried out the audit in accordance with the Auditor-General’s Auditing Standards, which incorporate the New Zealand Auditing 

Standards. 

We planned and performed the audit to obtain all the information and explanations we considered necessary in order to obtain reasonable 

assurance that the financial statements did not have material misstatements, whether caused by fraud or error. 

Material misstatements are differences or omissions of amounts and disclosures that would affect a reader’s overall understanding of the 

financial statements. If we had found material misstatements that were not corrected, we would have referred to them in our opinion. 

The audit involved performing procedures to test the information presented in the financial statements. We assessed the results of 

those procedures in forming our opinion. 

Audit procedures generally include: 

• determining whether significant financial and management controls are working and can be relied on to produce complete and 

accurate data; 

• verifying samples of transactions and account balances; 

• performing analyses to identify anomalies in the reported data; 

• reviewing significant estimates and judgements made by the Board of Directors; 

• confirming year-end balances; 

• determining whether accounting policies are appropriate and consistently applied; and 

• determining whether all financial statement disclosures are adequate. 

We did not examine every transaction, nor do we guarantee complete accuracy of the financial statements. 

We evaluated the overall adequacy of the presentation of information in the financial statements. We obtained all the information and 

explanations we required to support our opinion above. 

Responsibilities of the Board of Directors and the Auditor 

The Board of Directors is responsible for preparing financial statements in accordance with generally accepted accounting practice 

in New Zealand. Those financial statements must give a true and fair view of the financial position of the company as at 30 June 2007. 

They must also give a true and fair view of the results of its operations and cash flows for the year ended on that date. The Board of 

Directors’ responsibilities arise from the Port Companies Act 1988 and the Financial Reporting Act 1993. 

We are responsible for expressing an independent opinion on the financial statements and reporting that opinion to you. This 

responsibility arises from section 15 of the Public Audit Act 2001 and section 19 of the Port Companies Act 1988. 

Independence 

When carrying out the audit we followed the independence requirements of the Auditor-General, which incorporate the 

independence requirements of the Institute of Chartered Accountants of New Zealand. 

Other than the audit, we have no relationship with or interests in the company. 

1 8 

S M Tobin 

Audit New Zealand 

On behalf of the Auditor-General 

Christchurch, New Zealand

S T A T U T O R Y I N F O R M A T I O N 

T o s h a r e h o l d e r s , o n t h e a f f a i r s o f P o r t N e l s o n L i m i t e d 

f o r t h e Y e a r E n d e d 3 0 J u n e 2 0 0 7 

P R I N C I P A L A C T I V I T I E S 

Port Nelson Limited (“the Company” or “Port Nelson”) is primarily engaged in the commercial operation of the Port of Nelson. There has been 

no significant change in the nature of the Company’s business during the year. 

R E V I E W O F A C T I V I T I E S 

A review of the year’s operations is contained in the Chairman’s Report and the Chief Executive Officer’s Review. 

R E V I E W O F O P E R A T I O N S 

The surplus for the Company for the year was $6.725 million. (2006 $7.587 million) 

D I V I D E N D S 

Dividends of $6,600,000 were paid or provided for during the year. ($2,700,000 final dividend for 2006 financial year, $1,000,000 interim dividend 

for 2007 financial year, and a provision for $2,900,000 final for 2007 financial year) 

D I R E C T O R S 

In accordance with the Company’s constitution Messrs P K Matheson and T B King will retire by rotation. 

R E M U N E R A T I O N O F D I R E C T O R S 

Fees paid to Directors during the year were as follows: 

A O Patterson $43,045 

R G Dickinson $11,423 

T B King $11,500 

P V Lough $23,395 

P K Matheson $21,925 

B A Monopoli $17,880 

M G Sturgeon $5,725 

P M Schuyt $23,868 

TOTAL $158,761 

M G Sturgeon resigned in September 2006. 

B A Monopoli was appointed in September 2006. 

R G Dickinson resigned in December 2006. 

T B King was appointed in December 2006. 

D I R E C T O R S ’ I N S U R A N C E 

The Company has arranged policies of Directors’ Liability Insurance to ensure that as far as possible Directors will not personally incur any 

monetary loss as a result of actions undertaken by them as Directors. Certain actions are specifically excluded, for example the incurring of 

penalties and fines that may be imposed in respect of breaches of the law. 

D I R E C T O R S ’ I N T E R E S T 

The following notices have been received from Directors disclosing their interests in other companies with whom the group may have 

transactions. All transactions with these companies are conducted on normal commercial terms. 

• Mr T B King is Deputy Mayor of Tasman District Council, which is a shareholder of the Company. 

• Mr P K Matheson is Mayor of Nelson City, which is a shareholder of the Company. 

• Ms B A Monopoli is a Director of the Cawthron Institute that sell services to the Company. 

• Mr A O Patterson is a Director of Cold Storage Nelson Ltd that leases land and purchases services from the Company. 

• Mr P M Schuyt is a Director of ECN Ltd and Express Couriers Ltd that sell services to the Company. 

D I R E C T O R S ’ L O A N S 

There were no loans by the Company to Directors. 

The Statement of Accounting Policies and Notes to the Accounts on pages 26 to 42 form part of these Financial Statements. 

1 9

S T A T U T O R Y I N F O R M A T I O N 

T o s h a r e h o l d e r s , o n t h e a f f a i r s o f P o r t N e l s o n L i m i t e d 


S H A R E H O L D I N G B Y D I R E C T O R S 

No Directors hold shares in the Company. 

U S E O F C O M P A N Y I N F O R M A T I O N 

During the year the Board received no notices from Directors requesting to use Company information received in their capacity as Directors that 

would not otherwise have been available to them. 

C O M M I T T E E S O F T H E B O A R D 

The Board has established a Finance and Risk Committee to assist the Board in carrying out its responsibilities under the Companies Act 1993 and 

the Financial Reporting Act 1993, and a Remuneration Committee. 

A U D I T O R S 

Under section 15 of the Public Audit Act 2001 and section 19 of the Port Companies Act 1988, the Auditor General is the Auditor of the Company. 

The Auditor General has appointed Audit New Zealand to undertake the audit on its behalf. Fees paid to the Auditors are disclosed in the 

Financial Statements. 

P E R F O R M A N C E I N D I C A T O R S 

As required under Section 16 of the Port Companies Act 1988, performance indicators in the Statement of Corporate Intent are given on 

page 21. 

D O N A T I O N S 

Donations made during the year are disclosed in the Financial Statements. 

E M P L O Y E E R E M U N E R A T I O N 

The Company has remuneration agreements including benefits with employees in excess of $100,000 per annum in the following bands: 

Remuneration 

Number of Employees 


$100,000 to $110,000 3 3 

$110,000 to $120,000 - 1 

$120,000 to $130,000 3 2 

$130,000 to $140,000 1 - 

$150,000 to $160,000 - 1 

$160,000 to $170,000 1 - 

$190,000 to $200,000 - 1* 

$210,000 to $220,000 1* - 

$240,000 to $250,000 1 1 

* Employee retired during year 

C H A N G E S I N A C C O U N T I N G P O L I C I E S 

There have been no changes in accounting policies during the financial year. 

Chairman of Directors 

For and on behalf of the Board 

Date: 7 September 2007 

Director 

2 0 

The Statement of Accounting Policies and Notes to the Accounts on pages 26 to 42 form part of these Financial Statements.

S T A T E M E N T O F C O R P O R A T E I N T E N T 

M I S S I O N S T A T E M E N T 

• To operate the Company as a successful business providing cost efficient, effective and competitive services and facilities for port users and 

shippers. 

• To provide for the present and future needs of the Company in ways that are sensitive to people, use resources wisely, and are in harmony with 

the environment of an export port. 

O B J E C T I V E S 

1. To operate as a successful business. 

2. To be a good employer. 

3. The debt equity ratio not to exceed 66.67% (40/60). 

4. To aim to grow the business through stimulation of throughput, added value services and related business activities, so leading to increased 

revenue. 

5. To achieve a commercially acceptable rate of return on shareholders’ funds in accordance with meeting the objectives herein. 

6. To ensure that Port development takes place which meets the needs of the region. 

7. To ensure that adequate environmental standards are maintained. 

8. To strive for continuous improvement in everything that we do. 

M E A S U R E O F P E R F O R M A N C E A G A I N S T O B J E C T I V E S 

The 2005 figures are not comparable with 2006 and 2007 as the 2006 and 2007 financial information was prepared in accordance with NZ IFRS. 

Target 2007 2006 2005 Target Met? 

Lost Time Injury Frequency Rate *

I N C O M E S T A T E M E N T 


R E V E N U E 

Notes 2007 2006 

$000 $000 

Operations 27,864 25,364 

Property 5,159 4,902 

TOTAL REVENUE 1 33,023 30,266 

E X P E N S E S 

Operations and Property 20,767 18,673 

Financing 2,513 1,564 

TOTAL EXPENSES 2 23,280 20,237 

O P E R A T I N G S U R P L U S 9,743 10,029 

Reversal of Prior Year Building Asset Write Down Impairment - 699 

NET SURPLUS BEFORE TAXATION 9,743 10,728 

Less Taxation Expense 3 3,018 3,141 

N E T S U R P L U S 6,725 7,587 

S T A T E M E N T O F M O V E M E N T S I N E Q U I T Y 



$000 $000 

Opening Equity 128,405 128,380 

Movements in Hedging Reserve 6h 812 139 

Revaluations 6f 2,563 - 

Net Surplus 6,725 7,587 

Total Recognised Revenues and Expenses for the Period 10,100 7,726 

Distribution to Owners 6b (3,900) (7,700) 

Share Repurchase 6a (25,000) - 

C L O S I N G E Q U I T Y 109,605 128,405 

2 2 


S T A T E M E N T O F F I N A N C I A L P O S I T I O N 


C U R R E N T A S S E T S 

Notes 2007 2006 

$000 $000 

Cash and Cash Equivalents 7 2,170 2,484 

Trade and Other Receivables 8 3,518 3,011 

Inventories 9 394 363 

Prepayments and Accruals 361 343 

Tax Refund Due - 32 

Properties Intended for Sale 5 394 - 

Hedging Asset 13 1,290 78 

L E S S C U R R E N T L I A B I L I T I E S 

8,127 6,311 

Trade and Other Payables 10 1,721 1,452 

Employee Benefit Liabilities 17 1,103 1,050 

Tax Payable 69 - 

Dividend Payable 6b 2,900 2,700 

5,793 5,203 

W O R K I N G C A P I T A L 2,334 1,108 

N O N - C U R R E N T A S S E T S 

Property, Plant and Equipment 11 137,960 135,627 

Intangible Assets 12 742 709 

Investment Properties 5 14,311 13,983 

N O N - C U R R E N T L I A B I L I T I E S 

153,013 150,319 

Employee Benefit Liabilities 17 190 202 

Deferred Tax liability 4 3,552 3,820 

Term Loan 13, 14 42,000 19,000 

45,742 23,022 

T O T A L N E T A S S E T S 109,605 128,405 

S H A R E H O L D E R S F U N D S 

Issued Capital 6a 6,046 31,046 

Retained Earnings 6b 31,860 29,035 

Asset Revaluation Reserves 6f 70,835 68,272 

Hedging Reserve 6h 864 52 

T O T A L S H A R E H O L D E R S ’ F U N D S 109,605 128,405 

Chairman of Directors 

Director 

For and on behalf of the Board 

Date: 7 September 2007 


2 3

S T A T E M E N T O F C A S H F L O W S 


C A S H F L O W S F R O M O P E R A T I N G A C T I V I T I E S 


$000 $000 

Cash was provided from: 

Receipts from Customers 27,241 25,851 

Rent Received 4,447 4,187 

Interest Received 107 67 

31,795 30,105 

Cash was applied to: 

Payments to Suppliers and Employees (16,693) (15,020) 

Interest Paid (2,604) (1,540) 

Taxes Paid (3,176) (3,310) 

Net GST Paid (70) 115 

(22,543) (19,755) 

Net Cash In Flows from Operating Activities 9,252 10,350 

C A S H F L O W S F R O M I N V E S T I N G A C T I V I T I E S 


Property Plant and Equipment Sold 170 42 


Purchase of Property Plant Equipment and Intangibles (4,036) (2,891) 

Net Cash Out Flows from Investing Activities (3,866) (2,849) 

C A S H F L O W S F R O M F I N A N C I N G A C T I V I T I E S 


Loans Raised 25,000 - 


Loans Paid (2,000) - 

Shares Purchased and Cancelled (25,000) - 

Dividend Paid (3,700) (5,000) 

Net Cash Out Flows from Financing Activities (5,700) (5,000) 

Net Increase/(Decrease) in Cash Held (314) 2,501 

Cash at 1 July 2,484 (17) 

C A S H A T 3 0 J U N E 2,170 2,484 

Represented by: 

Cash at Bank 269 585 

Deposits 1,901 1,899 

C A S H A T 3 0 J U N E 2,170 2,484 

2 4 


S T A T E M E N T O F C A S H F L O W S 



$000 $000 

R E C O N C I L I A T I O N W I T H N E T S U R P L U S 


Add Non Cash Items: 

Depreciation and Amortisation 3,636 3,736 

Impairment - 194 

Increase (Decrease) in Deferred Tax (268) (143) 

Deferred Tax Movement Taken Direct to Equity 9 - 

Less: 

Reversal of Prior Year Building Asset Write Down Impairment - (699) 

Unrealised Gains (722) (712) 

2,655 2,376 

Add (Less) Movements in Other Working Capital Items: 

(Increase)/Decrease in Accounts Receivable (451) 583 

Increase/(Decrease) in Accounts Payable (excluding Assets Payable) 372 (144) 

Increase/(Decrease) in Current and Non Current Employee Benefit Liabilities (12) (87) 

Increase/(Decrease) in Tax Payable 101 (26) 

(Increase)/Decrease in Inventory (31) 73 

(Increase)/Decrease in Net GST (70) 115 

(Increase)/Decrease in Prepayments and Accruals (18) (99) 

(109) 415 

Add (Less) Items Classified as Investing Activities: 

(Profit) Loss on Sale of Assets (19) (28) 

N E T C A S H I N F L O W F R O M O P E R A T I N G A C T I V I T I E S 9,252 10,350 


2 5

S T A T E M E N T O F A C C O U N T I N G P O L I C I E S 

R E P O R T I N G E N T I T Y 

Port Nelson Limited is a public company registered under the Companies Act 1993 and created pursuant to the Port Companies Act 1988. 

Port Nelson is a reporting entity in terms of the Financial Reporting Act 1993. The financial statements of Port Nelson have been prepared in 

accordance with the Financial Reporting Act 1993. 

B A S I S O F P R E P A R A T I O N 

The financial statements have been prepared in accordance with Generally Accepted Accounting Practice in New Zealand (‘NZ GAAP’). They 

comply with New Zealand equivalents to International Financial Reporting Standards (‘NZ IFRS’) and other applicable reporting standards as 

appropriate for profit orientated entities. 

The financial statements are presented in New Zealand dollars and the functional currency of Port Nelson is New Zealand dollars. 

The financial statements were authorised for issue by the Directors on the 7 September 2007. 

S T A N D A R D S A N D I N T E R P R E T A T I O N S I S S U E D A N D N O T Y E T A D O P T E D 

There are no standards, interpretations and amendments that have been issued, but are not yet effective other than NZ IFRS 7 and 8, that Port 

Nelson has not yet applied. When effective these standards will require additional disclosures in the financial statements. 

A C C O U N T I N G P O L I C I E S 

Unless otherwise stated, all accounting policies applied are consistent with those of the prior year. Where appropriate, comparative figures have 

been amended to accord with the current year’s presentation and disclosure. 

M E A S U R E M E N T S Y S T E M 

Those accounting principles considered appropriate by the New Zealand Institute of Chartered Accountants for the measurement and reporting 

of results and financial position under the historical cost method, modified by the revaluation of land, buildings, wharves, and investment 

property, have been followed. 

R O U N D I N G O F A M O U N T S 

Amounts in this report have, unless otherwise indicated, been rounded to the nearest one thousand dollars. 

S P E C I F I C A C C O U N T I N G P O L I C I E S 

The accounting policies adopted in the financial statements, which have a significant effect on the result and the financial position disclosed are 

set out below: 

1.1 Revenue Recognition 

Revenue is recognised to the extent that it is probable that the economic benefits will flow to Port Nelson and that revenue can be 

reliably measured as follows: 

Cargo and Marine revenue – is recognised based on departure of the vessel. 

Stevedoring – is recognised based on partial completion of the vessel at balance date. 

Property lease revenue – is recognised on an accrual basis at balance date. Rentals are payable in advance. 

Interest revenue – is recognised on a time proportion basis using the effective interest method. 

1.2 Provisions 

Provisions are recognised when a present obligation exists as a result of a past event, the future sacrifice of economic benefits is probable, 

and the amount of the provision can be measured reliably. The amount recognised as a provision is the best estimate of the consideration 

required to settle the present obligation at reporting date, taking into account the risks and uncertainties surrounding the obligation. 

1.3 Property, Plant and Equipment and Depreciation 

Property, Plant and Equipment, except land, buildings, and wharves, are stated at valuation taken over from the Nelson Harbour Board 

on 1 October 1988 and subsequent additions at cost. Depreciation is written off depreciable assets on a straight line basis over the 

estimated economic lives of the assets, ranging as follows: 

2 6 

Years 

Years 

Wharves, Quays and Berths 20-65 Buildings 50-100 

Vessels 20 Cranes 15-20 

Forklifts 15-25 Tractors and Vehicles 10 

Sundry Plant and Equipment 5-20 Navigation and Pilot Equipment 10-40 

Office Equipment 5-15 Hard Standing 50 

Software 5 

Capital dredging is not amortised. The cost of maintaining the dredged depth is expensed. Land is valued at least every three years.

S T A T E M E N T O F A C C O U N T I N G P O L I C I E S 

Land is included at the valuation as at 1 July 2005 except for, (a) reclaimed land for which title has recently been received and has been 

revalued as at 30 June 2007, and, (b) investment property which is included at fair value being the market value of the lessor’s interests 

as at 30 June 2007, and is valued annually. Land owned and leased to third parties (other than investment property) is valued at the 

market value of the lessor’s interests. Non leased land is recorded at market value. Additions between valuations are recorded at cost. 

The land valuation was completed by Ian McKeage, Registered Valuer, FNZIV, FPINZ of TelferYoung. 

Buildings are stated at fair value. Fair value was determined as at 1 July 2005 using either a market based approach (where evidence 

can be reliably analysed) or optimised depreciated replacement cost. Additions between valuations are recorded at cost. Buildings are 

valued at least every five years. The buildings valuation was completed by Ian McKeage, Registered Valuer, FNZIV, FPINZ of TelferYoung. 

Wharves are stated at fair value as determined by a Chartered Professional Engineer employed by Port Nelson and reviewed by Ian 

McKeage, Registered Valuer, FNZIV, FPINZ of TelferYoung. Fair value was determined as at 1 July 2005 using optimised depreciated 

replacement cost. Wharves are valued at least every five years. Additions between valuations are recorded at cost. 

The asset classes that are subject to revaluation are assessed at each balance date to ensure that the values are not materially different 

from fair value. Where the carrying value is materially different from fair value a revaluation is undertaken. 

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount of the asset. Gains and losses are 

included in the Income Statement. When revalued assets are sold, the amounts included in asset revaluation reserves in respect of 

those assets are transferred to retained earnings. 

Cost incurred subsequent to initial acquisition are capitalised only when it is probable that future economic benefits or service 

potential associated with the item will flow to Port Nelson and the cost of the item can be reliably measured. 

1.4 Investment Properties 

Investment Property which is property held to earn rentals and/or capital appreciation is measured at its fair value at the reporting 

date. Gains or losses from changes in the fair value of Investment Property are included in the profit or loss in the period in which they 

arise. Investment Properties are not depreciated. 

1.5 Cash and Cash Equivalents 

Cash and Cash Equivalents comprise cash on hand, cash in banks and investments in money market instruments, net of outstanding 

bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities in the balance sheet. 

1.6 Trade and Other Receivables 

Trade and Other Receivables are valued at fair value and subsequently measured at amortised cost using the effective interest method, 

less any provision for impairment. 

A provision for the impairment of receivables is established when there is objective evidence that all amounts due will not be able to 

be collected as per the original terms of the receivables. The amount of the provision is the difference between the assets carrying 

amount and the present value of estimated future cash flows, discounted using the effective interest method. 

1.7 Inventories 

Inventory is valued at the lower of cost using the weighted average method and net realisable value. Full provision has been made for 

obsolescence where applicable. Stock is held for internal maintenance and construction work only. 

1.8 Intangible Assets 

Intangible Assets are limited to computer software. On acquisition they are capitalised at cost which equates to fair value. The 

computer software will have a finite life. Amortisation is to be charged to the Income Statement based on the finite life of the asset. 

Software is amortised on a straight line basis over five years. 

Intangible Assets will be tested for impairment where an indicator of impairment exists and useful lives will be assessed on an annual 

basis. 

1.9 Impairment of Assets 

At each reporting date, Port Nelson reviews the carrying amount of its Tangible and Intangible Assets to determine whether there is 

any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is 

estimated in order to determine the extent of the impairment loss (if any). 

Where the carrying amount of the asset exceeds its recoverable amount the asset is considered impaired and is written down to its 

recoverable amount. For revalued assets the impairment loss is recognised against the Revaluation Reserve for that class of asset. 

Where that results in a debit balance in the Revaluation Reserve, the balance is recognised in the Income Statement. For assets not 

carried at a revalued amount the impairment loss is recognised in the Income Statement. 

The reversal of an impairment loss on a revalued asset is credited to the Revaluation Reserve. However, to the extent that an impairment 

loss for that class of asset was previously recognised in the Income Statement, a reversal of the impairment loss is also recognised in the 

Income Statement. 

For assets not carried at a revalued amount, the total impairment loss is recognised in the Income Statement. 

2 7

S T A T E M E N T A C C O U N T I N G P O L I C I E S 

1.10 Goods and Services Tax 

All items in the financial statements are exclusive of Goods and Services Tax (GST) with the exception of receivables and payables 

which are stated with the GST included. Where GST is not recoverable as an input tax then it is recognised as part of the related asset 

or expense. 

The net amount of GST recoverable from, or payable to, the Inland Revenue Department (IRD) is included as part of receivables or 

payables in the Balance Sheet. 

The net GST paid to or received from the IRD, including the GST relating to investing and financing activities, is classified as an operating 

cash flow in the Statement of Cash Flows. 

Commitments and Contingencies are disclosed exclusive of GST. 

1.11 Income Tax 

The income tax expense for the period is the tax payable on the current period’s taxable income based on the income tax rate and 

adjusted by changes in Deferred Tax Assets and Liabilities attributable to temporary differences between the tax bases of assets and 

liabilities and their carrying amounts in the financial statements and for unused tax losses (if any). 

Deferred Tax Assets and Liabilities are recognised for temporary differences at the rate expected to apply when the assets are recovered 

or liabilities are settled. The tax rate is applied to the cumulative amounts of deductible and taxable temporary differences to measure 

the Deferred Tax Asset or Liability. 

Deferred Tax Assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable 

amounts will be available to utilise those temporary differences and losses. 

Deferred tax is charged or credited to the Income Statement, except where it relates to items charged or credited directly to equity, in 

which case the tax is dealt within equity. 

1.12 Borrowings 

Borrowings are initially recognised at their fair value. After initial recognition, all borrowings are measured at amortised cost using the 

effective interest method where this differs from face value. 

1.13 Derivative Financial Instruments 

Port Nelson uses derivative financial instruments such as interest rate swaps to hedge against interest rate fluctuations. Port Nelson 

does not hold or issue derivative financial instruments for trading purposes. Such derivative financial instruments are stated at fair 

value. The fair value of interest rate swaps is determined by reference to market values. The effective portion of changes in the fair 

value of the derivative financial instruments that are designated and qualify as cash flow hedges are deferred in equity. 

If a hedging instrument is sold, terminated, revoked or no longer meets the criteria for hedge accounting, the cumulative gain or loss 

that remains recognised directly in equity from the period when the hedge was effective will be recognised in the Income Statement. 

1.14 Financing Costs 

Finance costs are recognised as an expense when incurred. Financing costs directly attributable to buildings under construction are 

capitalised as part of the cost of those assets. 

1.15 Employee Entitlements 

Provision is made in respect of the company’s liability for annual leave, long service leave and retirement gratuities. Annual leave and 

long service leave has been calculated on an actual entitlement basis at current rates of pay and retirement gratuities calculated at 

current rates of pay assuming the payment will be made upon retirement. 

1.16 Foreign Exchange Transactions 

Transactions in foreign currencies are converted at the New Zealand rate of exchange ruling at the date of the transaction. Capital items 

are converted at the exchange rate ruling at balance date or the forward exchange contract rate where applicable. 

1.17 Leases 

Leases of plant and equipment are classified as operating leases. Operating lease payments are charged as an expense in the period 

in which they are incurred, as this represents the pattern of benefits derived from the leased assets. 

1.18 Dividends 

Provision is made for the amount of any dividend declared on or before the end of the financial year but not distributed at balance 

date. 

1.19 Critical Judgements 

Management have not had to exercise any critical judgements in the period ending 30 June 2007. 

C H A N G E S I N A C C O U N T I N G P O L I C I E S 

There have been no changes in accounting policies during the financial year. 

2 8

N O T E S T O T H E A C C O U N T S 

N O T E 1 : R E V E N U E 


Includes the following revenue: $000 $000 

P O R T O P E R A T I O N S 

Port Operations 27,702 25,269 

Interest 107 67 

Gain on Sale of Assets 55 28 

Total Port Operations 27,864 25,364 

P R O P E R T Y 

Non Investment Property 3,542 3,399 

Investment Property 895 791 

Fair Value Adjustment to Investment Property 722 712 

Total Property 5,159 4,902 

T O T A L R E V E N U E 33,023 30,266 

All revenue relates to continuing operations. 

N O T E 2 : N E T S U R P L U S B E F O R E T A X A T I O N 


Includes the following expense: $000 $000 

Administration Related 2,439 2,100 

Audit Fees – IFRS Restatement 21 - 

Audit Fees – Non IFRS 54 51 

Bad Debts Written Off 112 2 

Depreciation and Amortisation 3,636 3,736 

Directors Fees 159 136 

Donations/Corporate Sponsorship 195 159 

Employee Wages and Related Expenses 7,703 6,926 

Interest 2,513 1,564 

Impairment - 194 

Investment Property Expenses 12 12 

Loss on Sale of Assets 36 - 

Operating Leases 20 19 

Other Operating Expenses 6,380 5,338 

T O T A L E X P E N S E 23,280 20,237 

All expenses relate to continuing operations. 

N O T E 3 : P R O V I S I O N F O R T A X A T I O N 


$000 $000 

Current Tax 3,277 3,284 

Deferred Tax (143) (143) 

Deferred Tax Relating to Changes in Tax Rates (116) - 

T A X E X P E N S E 3,018 3,141 

Profit from Continuing Operations 9,743 10,728 

Tax at 33% 3,215 3,540 

Non Deductible Expenses 57 67 

Non Taxable Income (238) (466) 

Adjustments to Prior Year Estimates 100 - 

Deferred Tax Relating to Changes in Tax Rates (116) - 

T A X E X P E N S E 3,018 3,141 

2 9


N O T E 4 : D E F E R R E D T A X ( A S S E T S ) A N D L I A B I L I T I E S 

Employee 

Intangible 

PP&E Derivatives Entitlements Assets Total 

$000 $000 $000 $000 $000 

Opening Balance 4,065 26 (339) 68 3,820 

Charged to Profit and Loss (200) - 36 21 (143) 

Charged to Equity (189) 400 - - 211 

B A L A N C E A T 3 3 % 3,676 426 (303) 89 3,888 

Tax rate Adjustment 

Charged to Profit and Loss (114) - 6 (8) (116) 

Charged to Equity (220) - - - (220) 

C L O S I N G B A L A N C E 3,342 426 (297) 81 3,552 

N O T E 5 : I N V E S T M E N T P R O P E R T Y 


$000 $000 

Opening Balance 13,983 13,271 

Revaluations 722 712 

Properties Intended for Sale (394) - 

C L O S I N G B A L A N C E 14,311 13,983 

Properties Intended for Sale 

An Investment Property has been presented as Properties Intended for Sale following the Company entering into a Sale Agreement, on 7 June 

2007, with settlement after Balance Date. 

Basis of Valuation 

Investment Property is stated at fair value. Fair value was determined as at 30 June 2007 being the market value of the lessor’s interests as at 30 

June 2007, and is valued annually. Valuation was completed by Ian McKeage, independent Registered Valuer, FNZIV, FPINZ of TelferYoung. 

N O T E 6 : E Q U I T Y 

(a) Share Capital 2007 2006 

$000 $000 


Redeemed During the Year (25,000) - 

B A L A N C E A T 3 0 J U N E 6,046 31,046 

At 30 June 2007 the company has 25,415,404 ordinary shares. (2006 31,046,035). During the 2007 financial year the company purchased and 

cancelled 5,630,631 shares. All shares are fully paid and have no par value. All shares carry equal voting rights and the right to share in any surplus 

on winding up of the company. None of the shares carry fixed dividend rights. 

(b) Retained Earnings 2007 2006 

$000 $000 

Retained Earnings 29,035 26,749 


Dividends Paid (1,000) (2,600) 

Transfer to Dividend Payable (2,900) (2,700) 

R E T A I N E D E A R N I N G S A T 3 0 J U N E 31,860 29,035 

3 0


(c) Asset Revaluation Reserve (Land) 2007 2006 

$000 $000 


Revaluation Movement 2,638 - 


(d) Asset Revaluation Reserve (Wharves) 


Deferred Tax Movement 184 - 


(e) Asset Revaluation Reserve (Buildings) 



Revaluation Movement (484) - 


(f) Asset Revaluation Summary 



Revaluation Movement 2,154 - 


(g) Proposed Dividend Reserve 

Opening Balance - 2,400 

Dividend Paid - (2,400) 

C L O S I N G B A L A N C E - - 

(h) Hedging Reserve 

Opening Balance 52 (87) 

Fair Value Movement 1,212 165 

Deferred Tax Movement (400) (26) 

C L O S I N G B A L A N C E 864 52 

Revaluation Reserves 

The Revaluation Reserves relate to the revaluation of land, wharves, buildings and investment properties. 

Hedging Reserve 

The Hedging Reserve comprises the effective portion of the cumulative net change in the fair value of cash flow hedging instruments related to 

hedged transactions that have not yet occurred. 

N O T E 7 : C A S H A N D D E P O S I T S 2007 2006 

$000 $000 

General Account 269 585 

Call Account 1,901 1,899 

T O T A L 2,170 2,484 

3 1


N O T E 8 : A C C O U N T S R E C E I V A B L E 2007 2006 

$000 $000 

Trade Receivables 3,508 3,010 

Related Party Receivables 10 1 

T O T A L 3,518 3,011 

Movements in the provision for impairment of receivables are as follows: 

Opening Balance - - 

Additional Provisions made during the Year 72 - 

Receivables Written Off during Period - - 

A T 3 0 J U N E 72 - 

N O T E 9 : I N V E N T O R I E S 2007 2006 

$000 $000 

Opening balance 363 436 

Purchases 365 57 

Expensed (334) (130) 

C L O S I N G B A L A N C E 394 363 

No inventories are pledged as security for liabilities nor are any inventories subject to retention of title clauses. 

N O T E 1 0 : T R A D E A N D O T H E R P A Y A B L E S 2007 2006 

$000 $000 

Accruals 561 498 

GST Payable 181 241 

Trade Payables 874 706 

Related Party Payables 105 8 


N O T E 1 1 : P R O P E R T Y P L A N T A N D E Q U I P M E N T 

Accumulated 

Accumulated 

Depreciation Current Depreciation 

and Current Current Year and 

Cost/ Impairment Carrying Year Current Year Depre- Cost/ Impairment Carrying 

Revaluation Charges Amount Additions/ Year Impairment ciation Revaluation Revaluation Charges Amount 

30/06/06 30/06/06 30/06/06 Transfers Disposals Charges Charges Surplus 30/06/07 30/06/07 30/06/07 

2 0 0 7 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 

Mobile Plant 17,405 (8,692) 8,713 678 (139) - (950) - 17,304 (9,002) 8,302 

Floating Plant 5,338 (3,037) 2,301 0 - - (303) - 5,338 (3,340) 1,998 

Wharves & Berths 18,620 (887) 17,733 0 (502) - (889) - 18,103 (1,761) 16,342 

Wharves Leased 2,633 (167) 2,466 0 - - (167) - 2,633 (334) 2,299 

Plant, Furniture & Fittings 8,044 (4,049) 3,995 1,111 (12) - (602) - 9,113 (4,621) 4,492 

IT Equipment 1,492 (1,133) 359 51 - - (134) - 1,543 (1,267) 276 

Hardstanding & Roadways 4,970 (755) 4,215 765 - - (118) - 5,736 (874) 4,862 

Dredging 2,089 - 2,089 0 - - - - 2,089 - 2,089 

Buildings 8,486 (240) 8,246 272 - - (166) (484) 8,273 (405) 7,868 

Buildings Leased 2,625 (91) 2,534 419 - - (84) - 3,045 (176) 2,869 

Land Reclamation 1,443 - 1,443 (1,443) - - - - - - - 

Land 43,913 - 43,913 917 - - - 1,068 45,898 - 45,898 

Land Leased 36,946 - 36,946 1,074 - - - 1,570 39,590 - 39,590 

Work in Progress 674 - 674 401 - - - - 1,075 - 1,075 

154,678 (19,051) 135,627 4,245 (653) - (3,413) 2,154 159,740 (21,780) 137,960 

During the year the Company received title to the reclaimed land and revalued it in accordance with the Company’s Accounting Policies 2006. 

3 2


Accumulated 

Accumulated 

Depreciation Current Depreciation 


Cost/ Impairment Carrying Year Current Year Depre- Cost/ Impairment Carrying 

Revaluation Charges Amount Additions/ Year Impairment ciation Revaluation Revaluation Charges Amount 

30/06/05 30/06/05 30/06/05 Transfers Disposals Charges Charges Surplus 30/06/06 30/06/06 30/06/06 

2 0 0 6 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 

Mobile Plant 17,605 (7,770) 9,835 70 (6) (194) (992) - 17,405 (8,692) 8,713 

Floating Plant 4,978 (2,795) 2,183 417 (8) - (291) - 5,338 (3,037) 2,301 

Wharves & Berths 15,849 - 15,849 2,765 - - (881) - 18,620 (887) 17,733 

Wharves Leased 2,591 - 2,591 42 - - (167) - 2,633 (167) 2,466 

Plant, Furniture & Fittings 7,806 (3,509) 4,297 275 - - (577) - 8,044 (4,049) 3,995 

IT Equipment 1,356 (970) 386 136 - - (163) - 1,492 (1,133) 359 

Hardstanding & Roadways 4,847 (648) 4,199 123 - - (107) - 4,970 (755) 4,215 

Dredging 2,092 - 2,092 (3) - - - - 2,089 - 2,089 

Buildings 7,218 - 7,218 1,238 - - (210) - 8,486 (240) 8,246 

Buildings Leased 2,285 - 2,285 341 - - (92) - 2,625 (91) 2,534 

Land Reclamation 1,443 - 1,443 - - - - - 1,443 - 1,443 

Land 43,881 - 43,881 32 - - - - 43,913 - 43,913 

Land Leased 36,439 - 36,439 507 - - - - 36,946 - 36,946 

Work in Progress 2,340 - 2,340 (1,666) - - - - 674 - 674 

150,730 (15,692) 135,038 4,277 (14) (194) (3,480) - 154,678 (19,051) 135,627 

Note: All assets are held primarily for the operating of port facilities. 

Wharves and Buildings were valued as at 1 July 2005. The financial effect of the revaluations was that depreciation charges for the financial year 

were increased by $416,449. 

N O T E 1 2 : I N T A N G I B L E A S S E T S 

2 0 0 7 Accumulated Accumulated 

Amortisation Current Amortisation 


Impairment Carrying Year Current Year Amort- Impairment Carrying 

Cost Charges Amount Additions/ Year Impairment isation Cost Charges Amount 

30/06/06 30/06/06 30/06/06 Transfers Disposals Charges Charges 30/06/07 30/06/07 30/06/07 

$000 $000 $000 $000 $000 $000 $000 $000 $000 $000 

Software 1,951 (1,242) 709 258 - - (225) 2,209 (1,467) 742 

1,951 (1,242) 709 258 - - (225) 2,209 (1,467) 742 

2 0 0 6 Accumulated Accumulated 

Amortisation Current Amortisation 


Impairment Carrying Year Current Year Amort- Impairment Carrying 

Cost Charges Amount Additions/ Year Impairment isation Cost Charges Amount 

30/06/05 30/06/05 30/06/05 Transfers Disposals Charges Charges 30/06/06 30/06/06 30/06/06 

$000 $000 $000 $000 $000 $000 $000 $000 $000 $000 

Software 1,681 (986) 695 270 - - (256) 1,951 (1,242) 709 

1,681 (986) 695 270 - - (256) 1,951 (1,242) 709 

All Intangible Assets are externally generated. 

3 3


N O T E 1 3 : F I N A N C I A L I N S T R U M E N T S 

Financial Risk Management Objectives 

Port Nelson does not enter into or trade financial instruments, including derivative financial instruments for speculative purposes. Treasury 

functions are governed by a Treasury Policy approved by the Board of Directors. Approved instruments include: 

• Forward rate agreements 

• Interest rate swaps 

• Options on a swap 

• Interest rate options 

• Interest rate collars 

• Spot and forward foreign exchange 

Fixed rate hedging parameters are as follows: 

Term Minimum Fixed Rate Amount Maximum Fixed Rate Amount 

Less than 1 year 0% 100% 

1 year to 4 years 30% 70% 

5 years to 10 years 0% 50% 

Maximum Credit Risk Exposure 

Port Nelson is exposed to credit risk from the possibility of counter parties failing to perform their obligations. 

Credit risk exposure on financial assets other than cash at bank and at call has been recognised in the balance sheet net of any provision for 

doubtful debts. Principally any risk is in respect of cash and bank, and accounts receivable. 

The major components of debtor exposure are to shipping companies and forestry exporters. Terms of trade are either payment on the 20 th of 

the month following or 7 working days. The majority of debtors are major international companies with extensive histories of payment. There 

are no major concentrations of credit risk with respect to accounts receivable and any single debtor. 

Maximum exposures to credit risk at balance date are: 2007 2006 

$000 $000 

Bank 269 585 

Short Term Deposits @ 7.25% 1,901 1,899 

Receivables 3,518 3,011 

The above maximum exposures are net of any recognised provision for losses on these financial instruments. No collateral is held on the above 

accounts. 

The Directors do not consider there is any significant exposure to interest rate risk on its investments. 

Interest Rate Risk 

Under interest rate swap contracts, Port Nelson agrees to exchange the difference between fixed and floating rate interest amounts calculated 

on agreed, notional principal amounts thus allowing Port Nelson to mitigate the risk of changing interest rates on debt held. 

Swaps expiring within 12 months are treated as core debt and will be replaced with another approved instrument. 

The following table details the notional principle amounts and remaining terms of interest rate swap contracts outstanding as at reporting date. 

Notional Amount Fair Value Interest 0 to 1 1 to 2 2 to 3 3 to 4 9 to 10 

($000’s) gain/(loss) rate %* year years years years years 

2 0 0 7 ( A T B A L A N C E D A T E ) 

$12,000 Swap 96 7.49 12,000 - - - - 

$3,000 Swap 70 6.98 - 3,000 - - - 

$4,000 Swap 178 6.75 - - - 4,000 - 

$5,000 Swap 256 6.55 - - - 5,000 - 

$3,000 Swap 367 6.49 - - - - 3,000 

$27,000 967 - 12,000 3,000 - 9,000 3,000 

2 0 0 7 ( P O S T B A L A N C E D A T E ) 

$7,000 Swap 17 7.91 - 7,000 - - - 

$9,000 Swap 306 6.19 - - - - 9,000 

$16,000 323 - - 7,000 - - 9,000 

2 0 0 7 T O T A L 1,290 - 12,000 10,000 - 9,000 12,000 

2 0 0 6 T O T A L 78 - 6,000 - - 4,000 5,000 

3 4 

*Interest rate is exclusive of margin and line of credit fee.


All interest rate options and interest swap options are on 90 day roll-over terms. 

The following table summarises the Port Nelson exposure to interest rate risk as at 30 June 2007. 

2 0 0 7 (000’s) Weighted Fixed Maturity Dates 

Average 

Non 

Financial Effective Floating 0 to 1 1 to 2 3 to 4 9 to 10 Interest 

Instruments Interest Rate Interest Year Years Years Years Bearing Total 

A S S E T S 

Cash 7.94 % 2,170 - - - - - 2,170 

Receivables - - - - - - 3,518 3,518 

T O T A L - 2,170 - - - - 3,518 5,688 

L I A B I L I T I E S 

Borrowings 7.87 % 15,000 12,000 3,000 9,000 3,000 - 42,000 

Payables - - - - - - 1,721 1,721 

T O T A L - 15,000 12,000 3,000 9,000 3,000 1,721 43,721 

2 0 0 6 (000’s) Weighted Fixed Maturity Dates 

Average 

Non 

Financial Effective Floating 0 to 1 1 to 2 3 to 4 9 to 10 Interest 

Instruments Interest Rate Interest Year Years Years Years Bearing Total 

A S S E T S 

Cash 7.0 % 2,484 - - - - - 2,484 

Receivables - - - - - - 3,011 3,011 

T O T A L - 2,484 - - - - 3,011 5,495 

L I A B I L I T I E S 

Borrowings 7.37 % 4,000 6,000 - - 4,000 5,000 - 19,000 

Payables - - - - - - 1,453 1,453 

T O T A L - 4,000 6,000 - - 4,000 5,000 1,453 20,453 

Fair Values 

Cash at bank and at call are valued as the amount of the deposit or the purchase of the underlying security. 

Receivables are carried at the nominal amount due, less any provision for doubtful debts which represents the assessed credit risk. 

Liability to trade creditors is recognised on receipt of goods and services at nominal value. Payment would normally occur within 30 days. 

The following table details the fair value comparison of the long term borrowings as at 30 June 2007. 

F I N A N C I A L L I A B I L I T I E S 

Carrying Value 

Fair Value 

2007 2006 2007 2006 

$000 $000 $000 $000 

Term Debt 42,000 19,000 42,000 19,000 

Fair Value Movement (1,290) (129) 

T O T A L F I N A N C I A L L I A B I L I T I E S 42,000 19,000 40,710 18,871 

Currency Risk 

Port Nelson has no currency risk. (2006 Port Nelson had no currency risk). 

N O T E 1 4 : T E R M L O A N 

The Company has financing arrangements with Westpac Banking Corporation. The total facility is $57,000,000 for a term of 5 years. (2006: 

$31,000,000 for a term of 5 years) 

Security for the multi option credit facility is by a first and exclusive debenture charge over the assets and undertakings of the Company. 

3 5


N O T E 1 4 : T E R M L O A N ( . . . c o n t i n u e d ) 

Interest Rate Contracts: 

The notional principal amounts of interest rate contracts outstanding at 30 June are as follows: 

1. $12,000,000 for 1 year @ 7.49% p.a. terminating 30 May 2008. 

2. $3,000,000 for 2 years @ 6.98% p.a. terminating 29 May 2009. 



5. $3,000,000 for 9 years @ 6.49% p.a. terminating 30 November 2016. 

6. $15,000,000 at floating interest rate. 

Swaps expiring within 12 months are treated as core debt and will be replaced with another approved instrument. 

N O T E 1 5 : C O M M I T M E N T S 

The following expenditure was contracted for at balance date but not provided for: 


$000 $000 

Capital Development 197 238 

N O T E 1 6 : O P E R A T I N G L E A S E S 

Non-cancellable operating leases as lessee 


$000 $000 

Not later than one year 3 - 

Later than one year and not later than five years 46 49 

T O T A L N O N - C A N C E L L A B L E O P E R A T I N G L E A S E S 49 49 

N O T E 1 7 : E M P L O Y E E B E N E F I T L I A B I L I T I E S 


$000 $000 

Accrued Pay 282 421 

Annual Leave 593 581 

Long Service Leave 88 89 

Retirement Gratuities 125 113 

Other Benefits 205 48 

T O T A L E M P L O Y E E B E N E F I T L I A B I L I T I E S 1,293 1,252 

Comprising: 

Current 1,103 1,050 

Non-current 190 202 

T O T A L E M P L O Y E E B E N E F I T L I A B I L I T I E S 1,293 1,252 

N O T E 1 8 : C O N T I N G E N T A S S E T S & L I A B I L I T I E S 


The Noise Variation has been notified by the Nelson City Council with effect. Over the next 6 months it is expected that remedial noise mitigation 

work will be required. 

2006 

There may be a potential liability in the future with respect to noise mitigation costs of residential housing to comply with the proposed noise 

variation (yet to be notified) to the Nelson City Council Resource Management Plan. Given the status of current hearings it is not possible to 

reliably estimate the liability. 

3 6


N O T E 1 9 : R E L A T E D P A R T Y D I S C L O S U R E 


Nelson City Council 

$000 $000 

Services Provided by Port Nelson 41 13 

Services Provided to Port Nelson 485 266 

Accounts Payable by Port Nelson 104 1 

Accounts Receivable by Port Nelson 10 1 

*Dividends Paid by Port Nelson 1,850 2,500 

Share Buy Back by Port Nelson 12,500 - 

Tasman District Council 

*Dividends paid by Port Nelson 1,850 2,500 

Share buy back by Port Nelson 12,500 - 

Nelmac 

Services Provided to Port Nelson 21 18 

Accounts Payable by Port Nelson 1 - 

* Net of imputation credits 

Nelmac 

Nelmac is 100% owned by Nelson City Council and is therefore a related party. 

All Related Parties 

There were no nil or nominal value transactions between the Company and related parties (2006 nil). 

No inter entity debt has been forgiven or written off (2006 nil). 

Directors 

Mr A O Patterson is a Director of Cold Storage Nelson Ltd that leases land from the Company. The amount received from Cold Storage Nelson Ltd 

was $408,745 for the year, and $NIL was receivable at year end (2006 $315,304). The amount paid to Cold Storage Nelson Ltd was $1,871 for the 

year, and $NIL was payable at year end (2006 $99). 

Mr P M Schuyt is a Director of ECN Ltd from which the Company purchased EDI services. Payments for the year to 30 June totalled $5,067. 

(2006 $4,458) The Company owed $400 as at 30 June (2006 $210). Mr P M Schuyt is a Director of Express Couriers Ltd from which the Company 

purchased courier services. Payments for the year to 30 June totalled $1,503 (2006 $1,738). The Company owed $71 as at 30 June (2006 $127). 

Mr P M Schuyt is also an employee of New Zealand Post Ltd. The amount paid to New Zealand Post Ltd was $6,722 for the year, and $425 was 

payable at year end. 

Key Management Personnel 

Details of compensation paid to key management personnel during the financial year: 


$000 $000 

Total remuneration to Key Management Personnel 1,136 1,283 

Termination Benefits - 61 

T O T A L 1,136 1,344 

N O T E 2 0 : F I N A N C I A L R E P O R T I N G B Y S E G M E N T S 

Port Nelson operates in one industry and one geographical segment providing and managing port facilities, marine services, cargo handling 

operations, and investment properties at the port of Nelson. 

3 7


N O T E 2 1 : I M P U T A T I O N C R E D I T S 

Imputation Credits Available to Shareholders: 2007 2006 

$000 $000 


Tax Paid 3,176 3,310 

Credits Attached to Dividends Paid (1,822) (2,463) 


N O T E 2 2 : E V E N T S O C C U R R I N G A F T E R B A L A N C E D A T E 

Subsequent to balance date Port Nelson entered into an agreement to purchase a number of properties and divest a number of other properties 

with a single counterparty. This transaction resulted in the company obtaining freehold title to a number of strategic properties while divesting 

a number of non strategic properties. Settlement was 31 July 2007. 

The net effect of this transaction was that Port Nelson acquired an additional $2,887,000 of non current assets. 

N O T E 2 3 : R E C O N C I L I A T I O N B E T W E E N N Z I F R S A N D N Z G A A P A S A T 3 0 J U N E 2 0 0 6 

Effect of 

Previous transition to 

NZGAAP NZIFRS NZIFRS 

Notes $000 $000 $000 


Cash and Cash Equivalents 2,484 - 2,484 

Receivables 3,011 - 3,011 

Inventory 363 - 363 

Prepayments 343 - 343 

Tax Refund 32 - 32 

Hedging Assets a - 78 78 

6,233 78 6,311 


Bank 

Accounts Payable 1,453 - 1,453 

Employee Entitlements 1,050 - 1,050 

Provision for Dividend 2,700 - 2,700 

Hedging Liability - - - 

5,203 - 5,203 

W O R K I N G C A P I T A L 1,030 78 1,108 

N O N C U R R E N T A S S E T S 

Property, Plant and Equipment b 136,336 (709) 135,627 

Investment Property 13,983 - 13,983 

Intangible Assets b - 709 709 

N O N C U R R E N T L I A B I L I T I E S 

150,319 - 150,319 

Employee Entitlements 202 - 202 

Deferred Tax Liability c 3,663 157 3,820 

Term Loan 19,000 - 19,000 

22,865 157 23,022 

T O T A L N E T A S S E T S 128,484 (79) 128,405 

3 8 

E Q U I T Y 

Issued Capital 31,046 - 31,046 

Retained Earnings d 18,469 10,566 29,035 

Proposed Dividend Reserve - - - 

Asset Revaluation Reserve e 78,969 (10,697) 68,272 

Hedging Reserve a - 52 52 

T O T A L E Q U I T Y 128,484 (79) 128,405


N o t e s t o t h e R e c o n c i l i a t i o n s 3 0 J u n e 2 0 0 6 

(a) Hedging Liability 

Port Nelson qualifies for treatment of its financial derivatives as Cash Flow Hedges per NZ IAS 39. At 30 June 2006 Port Nelson had a $78,000 

Hedging Asset. 

Effect of movement: Effect of 

Previous transition to 

NZGAAP NZIFRS NZIFRS 

$000 $000 $000 

Hedging Asset - 78 78 

Deferred Tax Liability - (26) (26) 

Hedging Reserve - 52 52 

(b) Intangibles 

The effect of the reclassifications as at 30 June 2006 are as below. Effect of 

transition to 

Previous 

NZIFRS 

NZGAAP Reclassification NZIFRS 

30 June 2006 $000 $000 $000 

I N T A N G I B L E S 709 (709) - 

Software (Intangibles) 709 (709) - 

Intangibles in the nature of software amounting to $709,000 have been reclassified as Intangibles. 

(c) Deferred Tax Liability $000 

Opening 3,663 

Reversal of existing NZ GAAP (3,663) 

3 0 J U N E 2 0 0 6 N Z I F R S L I A B I L I T Y 3,820 

Consisting of: 

Deferred Tax Asset (805) 

Deferred Tax Liability 4,625 

3 0 J U N E 2 0 0 6 N Z I F R S L I A B I L I T Y 3,820 

At 30 June 2006 a temporary difference of $12,602,000 existed between the total tax base value of depreciable assets and the total carrying 

value of the same assets. A Deferred Tax Liability of $4,625,000 in relation to the temporary difference between the value of the asset bases was 

established requiring an increase to the Deferred Tax Liability. Against the increase in Deferred Tax Liability, a Deferred Tax Asset of $466,000 

relating to the temporary differences between tax base value of depreciable assets and the carrying value of those assets and $339,000 relating 

to the Employee was netted. The Deferred Tax asset of $805,000 has been netted against the Deferred Tax Liability as per NZIAS 12 (74). 

(d) Retained Earnings 

30 June 2006 $000 

NZ GAAP 18,469 

Investment Property revaluation 1/7/05 5,469 

Transfer of balance previously attributable to Investment Property from Revaluation Reserve 5,763 

Transfer from Revaluation Reserve of debit balances relating to individual assets previously netted off on a class basis (1,109) 

Reversal of existing NZ GAAP Deferred Tax Liability balance at Transition 1,259 

Deferred Tax Liability adjustment on differing tax bases as at 1 July 2005 excluding revaluations (1,319) 

Reversal of Investment Property revaluation at 30 June 2006 previously transferred to Revaluation Reserve 712 

NZ IFRS transition adjusting entry (209) 

3 0 J U N E 2 0 0 6 N Z I F R S R E T A I N E D E A R N I N G S 29,035 

3 9


N O T E 2 3 : R E C O N C I L I A T I O N B E T W E E N N Z I F R S A N D N Z G A A P A S A T 3 0 J U N E 2 0 0 6 ( . . . c o n t ) 

(e) Asset Revaluation Reserve Effect of transition Effect of transition 

Previous to NZIFRS to NZIFRS 

NZGAAP Reclassification Adjusting Entry NZIFRS 

30 June 2006 $000 $000 $000 $000 

A S S E T R E V A L U A T I O N R E S E R V E 78,969 (12,015) 1,318 68,272 

Consisting of: Buildings 1,144 - 780 1,924 

Land 61,853 - - 61,853 

Investment Property 11,944 (11,944) - - 

Wharves 4,028 (71) 538 4,495 

The revaluation components associated with Investment Property are more appropriately allocated to Retained Earnings as per NZIAS 40 (35). 

$000 

Opening 78,969 

Transfer from Retained Earnings of credit balances relating to individual assets previously netted-off on a class basis 1,108 

Transfer of accumulated revaluation increments for Investment Property (11,944) 

Reversal of existing NZ GAAP Deferred Tax Liability balance at Transition 329 

Reversal of existing NZ GAAP Deferred Tax Liability movement in 2006 year 2,217 

Deferred Tax Liability adjustment on depreciable revaluations on 1 July 2005 (2,616) 

IFRS transition adjusting entry 209 

C L O S I N G 68,272 

N O T E 2 4 : E X P L A N A T I O N O F T R A N S I T I O N T O N E W Z E A L A N D E Q U I V A L E N T S T O I F R S 

A S A T T H E D A T E O F T R A N S I T I O N T O N Z I F R S : 1 J U L Y 2 0 0 5 

Previous Effect of transition 

NZGAAP to NZIFRS NZIFRS 


Notes $000 $000 $000 

Cash and Cash Equivalents - - - 

Trade and Other Receivables 3,666 - 3,666 

Inventories 436 - 436 

Prepayments 131 - 131 

Tax Refund 6 - 6 

4,239 - 4,239 


Bank 17 - 17 

Trade and Other Payables 1,682 - 1,682 


Hedging Liability a 129 129 

2,660 129 2,789 

W O R K I N G C A P I T A L 1,579 (129) 1,450 

N O N C U R R E N T A S S E T S 

Property, Plant and Equipment b 117,189 18,958 136,147 

Investment Property - 13,271 13,271 

Intangible Assets b - 695 695 

117,189 32,924 150,113 

N O N C U R R E N T L I A B I L I T I E S 


Deferred Tax Liability c 1,588 2,306 3,894 

Term Loan 19,000 - 19,000 

20,877 2,306 23,183 

T O T A L N E T A S S E T S 97,891 30,489 128,380 

4 0 

E Q U I T Y 

Issued Capital 31,046 - 31,046 

Retained Earnings d 16,894 9,855 26,749 

Proposed Dividend Reserve 2,400 - 2,400 

Asset Revaluation Reserve e 47,551 20,721 68,272 

Hedging Reserve a - (87) (87) 

T O T A L E Q U I T Y 97,891 30,489 128,380


N o t e s t o t h e R e c o n c i l i a t i o n s 1 J u l y 2 0 0 5 

(a) Hedging Liability 

Port Nelson qualifies for treatment of its financial derivatives as Cash Flow Hedges per NZ IAS 39. On transition Port Nelson had a $129,000 

hedging liability. 

Effect of movement: 

Previous Effect of Transition 

NZGAAP to NZIFRS NZIFRS 

$000 $000 $000 

Deferred Tax (Asset) - (42) (42) 

Hedging Liability - 129 129 

Hedging Reserve - (87) (87) 

(b) Revaluations 

On transition, a number of reclassifications where made to Property Plant and Equipment in addition to Port Nelson revaluing its Land, Wharves 

and Buildings. Previously Buildings were not revalued. The revaluation of Buildings is a policy change associated with the transition to IFRS. 

Effect of Transition Effect of Transition 

Previous to NZIFRS to NZIFRS 

NZGAAP Reclassification Revaluation NZIFRS 

1 July 2005 $000 $000 $000 $000 

P R O P E R T Y , P L A N T A N D E Q U I P M E N T 117,189 32,924 150,113 


Mobile Plant 9,835 - - 9,835 

Floating Plant 2,183 - - 2,183 

Wharves Leased 2,288 - 302 2,591 

Wharves 11,467 - 4,712 16,178 

Plant, Furniture and Fittings 4,296 - - 4,296 

Information Technology 1,080 (695) - 385 

Software (Intangibles) - 695 - 695 

Hard standing and Roadways 4,198 - - 4,199 

Dredging 2,093 - - 2,093 

Buildings 6,336 - 1,297 7,632 

Buildings Leased 2,240 - 410 2,651 

Land at Cost – Reclamation 1,443 - - 1,443 

Land (Revalued) 33,532 (298) 10,646 43,881 

Land (Revalued) Leased 33,857 (7,504) 10,086 36,439 

Investment Property - 7,802 5,469 13,271 

Work in Progress 2,341 - - 2,341 

Port Nelson has elected to use the revalued amounts at Transition as fair value. Land will continue to be revalued every three years and Wharves 

and Buildings at five year intervals or earlier if there has been a material change in value of the assets. 

Intangibles in the nature of software amounting to $695,000 at Transition have been identified. Investment Property has been classified and 

revalued at Transition. The amount relating to Investment Property under previous NZ GAAP was $7,802,000 recognised on transition and 

subsequently revalued. 

On Transition a review was undertaken of the categorisation of all Port Nelson assets with reclassification adjustments made where deemed 

appropriate between the other categories. 

4 1


N O T E 2 4 : E X P L A N A T I O N O F T R A N S I T I O N T O N E W Z E A L A N D E Q U I V A L E N T S T O I F R S 

A S A T T H E D A T E O F T R A N S I T I O N T O N Z I F R S : 1 J U L Y 2 0 0 5 ( . . . c o n t i n u e d ) 

(c) Deferred Tax Liability $000 

Opening 1,558 

Reversal of Existing NZ GAAP (1,558) 

1 J U L Y 2 0 0 5 N Z I F R S L I A B I L I T Y 3,894 


Deferred Tax Asset (640) 

Deferred Tax Liability 4,534 

1 J U L Y 2 0 0 5 N Z I F R S L I A B I L I T Y 3,894 

At Transition a temporary difference of $12,893,000 existed between the total tax base value of depreciable assets and the total carrying value 

of the same assets. A Deferred Tax Liability of $4,534,000 in relation to the temporary difference between the value of the asset bases was 

established requiring an increase to the Deferred Tax Liability. Against the increase in Deferred Tax Liability, a Deferred Tax Asset of $279,000 

relating to the temporary differences between tax base value of depreciable assets and the carrying value of those assets, $318,000 relating to 

the Employee Entitlements and $43,000 relating to the Hedging Liability was netted. The Deferred Tax asset of $640,000 has been netted against 

the Deferred Tax Liability as per NZIAS 12 (74). 

(d) Retained Earnings $000 


Investment Property revaluation 1/7/05 5,469 

Transfer of balance previously attributable to Investment Property from Revaluation Reserve 5,763 

Transfer from Revaluation Reserve of debit balances relating to individual assets previously netted off on a class basis (1,108) 

Reversal of existing NZ GAAP Deferred Tax Liability balance at Transition 1,259 

Deferred Tax Liability adjustment on differing tax bases as at 1 July 2005 excluding revaluations in (e) (1,319) 

IFRS transition adjusting entry (209) 

C L O S I N G 26,749 

The Deferred Tax Liability balance at Transition ($1,588,000) relating to Retained Earnings amounting to $1,259,000 has been adjusted against 

Retained Earnings within the Deferred Tax Liability Adjustment. 

(e) Asset Revaluation Reserve $000 


Revaluation of PPE 27,455 

Transfer from Retained earnings of credit balances relating to individual assets previously netted-off on a class basis 1,108 

Transfer of accumulated revaluation increments for Investment Property (5,763) 

Reversal of existing NZ GAAP Deferred Tax Liability balance at Transition 329 

Deferred Tax Liability adjustment on depreciable revaluations on 1 July 2005 (2,616) 

IFRS transition adjusting entry 209 

C L O S I N G 68,272 

The total revaluation increase of $32,924,000 consisted of $28,562,000 relating to PP&E and $5,469,000 relating to Investment Property. The 

revaluation increment required an adjustment to reflect the Deferred Tax Liability effect on the depreciable assets revalued at 1 July 2005. The 

adjustments resulted in a net $20,721,000 increase to the Revaluation Reserve account. 

4 2

Board of Directors 

A.O. Patterson Chairman 

T.B. King 

P.V. Lough Deputy Chairman and 

Chairman Remuneration Committee 

P.K. Matheson 

B. Monopoli 

P.M. Schuyt Chairman Finance and Risk Committee 

Secretary 

P.J. Pittar 

Executive Officers 

M.J. Byrne Chief Executive Officer 

K.M. Barnett Human Resources & Quality Manager 

R.J. Carter Infrastructure Manager 

P.N. Francois Cargo Operations Manager 

P.J. Pittar 

Chief Commercial Officer 

C.J. Shand Tasman Bay Stevedoring Manager 

R.J. Skucek Maritime Operations Manager 

C.E. Williams Marketing Manager 

D I R E C T O R Y 

Registered Office 

10 Low Street, Port Nelson 

PO Box 844, Nelson 7040 

New Zealand 

Tel. (03) 548 2099 

Fax. (03) 546 9015 

mail@portnelson.co.nz 

www.portnelson.co.nz 

Auditors 

Audit New Zealand, on behalf of the 

Office of the Auditor General 

Solicitors 

Pitt & Moore 

Barristers & Solicitors 

PO Box 42 

Nelson 7040 

J.A. Levenbach 

Barrister & Solicitor 

PO Box 35 


Simpson Grierson 

Barristers & Solicitors 

PO Box 2402 

Wellington 6140 

Bankers 

Westpac Banking Corporation 

PO Box 643 


4 3

Mission Statement 

To operate the Company as a successful business providing cost 

efficient, effective and competitive services and facilities for port 

users and shippers. 

To provide for the present and future needs of the Company in 

ways that are sensitive to people, use resources wisely, and are in 

harmony with the environment of an export port.

Port Nelson Annual Report 2007 (pdf)

Create successful ePaper yourself

Delete template?

Save as template?