| The Hawke's Bay Regional Council currently holds a 91.7% shareholding in Port of Napier Limited. The Port Company operates as a fully autonomous subsidiary of the Regional Council and therefore the Council does not participate in the management and operation of the Company. However, as the majority shareholder, basic rights are available to enable prudent assessment of this investment and the Council appoints the Directors of the Company. | 
Port of Napier |
The Council's shareholding in the Port of Napier is disclosed in the Statement of Financial Position as an investment and is recorded at a fair value. This value was last established in April 2002 by the Directors who used a valuation completed by Deloitte Touche Tohmatsu. Dividend receipts of $4,195,000 are anticipated for the 2003/04 year. The Port's dividend payment policy is that the annual dividend will be 75% of profits earned after tax.
Turnover for the Company in 2001/02 was $33.82 million (2000/01 $31.66 million). The gross assets of the Company at 30 September 2002 were $65.24 million (2001 $54.71 million).
The Port company continues to operate profitably and is in a sound financial position.
The following information is extracted from the Statement of Corporate Intent of Port of Napier Limited adopted in December 2002 which covers the three years 1 October 2002 to 30 September 2005.
Objectives
- To operate the Company as a successful business.
- For its users, the Company will provide a safe, effective and efficient port operation at reasonable cost.
- For its shareholders, the Company will manage the financial assets and liabilities prudently and in a manner which will yield a satisfactory profit.
- For its employees, the Company will promote a safe working environment where positive contribution is encouraged and rewarded.
- The Company will provide business leadership and support to the community.
Nature and scope of activities
Port of Napier Limited will:
- Provide a commercial harbour, comprising deep water wharves, land and buildings which are essential to the proper and safe operation of an international port.
- Ensure the provision of such pilotage, towage and mooring services to vessels utilising Port of Napier, as may be required from time to time.
- Ensure an efficient and competitive cargo handling service is provided, which meets the special requirements of all cargoes and commodities, by type and configuration (e.g. breakbulk, unitised and containerised).
- Aggressively promote and market Port of Napier to shipping lines, importers and exporters and the wider Hawke's Bay Region.
- Provide and/or contract such technical, administrative or specialised services as may be required to achieve these objectives.
- Maintain an Environmental Management Plan to provide a systematic review of responsible environmental management practices and procedures and a framework for ongoing monitoring and practical improvements.
Performance targets and measures
The Company's financial performance will be judged against the following targets.
| | Desired
Target
% | Actual
FY 2001
% | Budget
FY 2002
% |
| Net debt to net debt plus equity | 30 | 4.8 | 23.2 |
| Earnings before depreciation, interest and tax to total assets | 18 | 22.2 | 23.1 |
| Earnings before interest & tax to Shareholders' funds | 20 | 27.4 | 24.4 |
| Operating surplus after tax to Shareholders' funds | 10 | 15.1 | 14.4 |