POT Annual Meeting 2026: Chair and Chief Executive's Speech

Chair's Speech Chair – Julia Hoare I’m very pleased to be reporting on a record underlying profit for the 2026 financial year, driven by successful yield, cost and productivity initiatives. Despite lower cargo volumes, underlying Group Net Profit After Tax increased 23% to $155.3 million. Revenue increased 4.7% to $486.5 million, while operating costs decreased 6.2% to $221.7 million. Our subsidiary and joint venture companies also performed well, with their contribution increasing 42.1% to $15.5 million. These are outstanding results, particularly given the challenging economic conditions and ongoing capacity constraints that we have faced. Total trade volumes decreased 3% to 24.6 million tonnes, mainly due to reduced log and coal volumes, while container volumes remained resilient at just over 1.2 million TEUs. Leonard will go into more detail on cargo categories shortly. The strength of the business enabled the Board to declare a final dividend of 12.5 cents per share, bringing the total ordinary dividend for the year to 20.5 cents per share. That was a 22.8% increase on the previous year, and approximately $139 million in dividends to shareholders for the 2026 financial year. This represented a payout of 90% of underlying earnings for the year. We are pleased to deliver this increased return to shareholders, while continuing to invest in the long-term capacity and resilience of the business. One of the most important developments of the year was the significant progress made towards securing resource consents for our Stella Passage development. This project involves extending the Sulphur Point container berth by 385 metres, in two stages, and the Mount Maunganui wharves by 315 metres. It will be achieved by converting existing cargo storage land, within our current footprint. As you have heard from us for several years now, this development is urgently needed. Our container terminal is essentially at capacity, and we have a queue of shipping lines wanting to increase their business or introduce new services through Tauranga. To recap our journey so far, very briefly – we started formal consultation back in 2019 and in December 2024, we secured Environment Court approval of the first stage of the development. The decision was immediately appealed, so we opted into the fast-track process. Unfortunately, due to an error in the legislation, not of our making, our first attempt under the Fast-track Approvals Act was successfully challenged in the High Court. After the legislation was fixed, we made a fresh application in January this year and a three-day cultural effects hearing was held at Whareroa Marae in July. On 7 September, the fast-track expert panel issued a decision approving the development, subject to a number of conditions. After such a long process, this is a significant milestone. The decision is now subject to three appeals by iwi and two judicial review applications by hapū. We expect these to be heard in a single hearing, and we hope to confirm an urgent hearing date any day now. The Stella Passage development is vital for our customers, and both the regional and national economies. Additional berth capacity will enable greater competition and better productivity, helping to reduce supply chain costs for New Zealand’s importers, exporters and, ultimately, consumers. It will also unlock important decarbonisation opportunities, by allowing us to introduce electric automated stacking cranes at the terminal, and by facilitating more visits from larger vessels, which are more carbon-efficient. The Environment Court and the fast-track panel agreed that the development’s impact on the environment, according to Western science, will be minor in the short-term and negligible in the long-term. We remain committed to working with iwi and hapū regarding the cultural concerns around the development, with ongoing consultation embedded in the resource consent conditions. Importantly, we have not stood still while the Stella Passage consenting process has continued. The second stage of our capital dredging programme is under way, with completion due around mid-2027. We are also progressing preparations to introduce automated stacking cranes, or ASCs, into the container terminal alongside construction of the new berth. We have completed the emulation phase, where processes are tested virtually, and are now refining processes and system design, ensuring operational readiness and finalising contracts with our preferred vendor. The first stage will involve two blocks of nine electric ASCs, which will coincide with the completion of the new container berth. In August, we took delivery of another six hybrid straddle carriers, as well as New Zealand’s first fully electric straddle carrier. We are also building New Zealand’s first hybrid tug boat, expected to be delivered in mid-2027 from Turkey. These investments will all improve efficiency while reducing greenhouse gas emissions. We firmly believe that growth, productivity and environmental performance can, and must, progress together. Wearing my other hat as Chair of Northport Group, we are very pleased with the granting of resource consent for its planned expansion, which includes nearly 12 hectares of reclamation, a 250-metre wharf extension and associated capital dredging. The expansion will give Northport and the Northland economy the opportunity to play a larger role in an increasingly integrated Upper North Island supply chain. The timing of the development will depend on freight demand and progress on the proposed rail link to Marsden Point. Turning to governance, I would like to thank my fellow Directors for their diligence and commitment over the past year. During the year, we farewelled Doug Leeder with our sincere gratitude for his many years of service and welcomed Ken Shirley as a Quayside-appointed Director. He stands for election at today’s meeting. Our Future Director, Scott Campbell, concluded his appointment on 31 March and we thank him for his contribution. Fraser Whineray is also standing for re-election today, and you will hear from both him and Ken when it comes to the meeting resolutions. Before I hand over to Leonard, I’d like to thank him, the senior management team and all our Port people for their efforts over the past year. The improvements in productivity and customer service, the ongoing investment in capacity, and progress in improving environmental outcomes give us great confidence in Port of Tauranga’s future. Ngā mihi nui. Chief Executive's Speech Chief Executive – Leonard Sampson Thank you Julia and kia ora koutou. The 2026 financial year was indeed a very successful one for Port of Tauranga. I’d like to start with a particular highlight of improving service delivery to our customers, which has been a major focus. Our average net crane rate increased 9.9% to 30.8 moves per hour, along with our ship rate (or berth rate as it’s also known) increasing 13% to 76.4 container moves per hour, up from 67.2 the previous year. This was helped by an improvement in schedule reliability, with the proportion of container ships arriving on time increasing to 71% from 62% in the previous year. Our team also introduced new emulation technology in the container terminal which has helped with better planning to improve straddle efficiency and reduce unnecessary container rehandling. We will continue to focus on service delivery and productivity, particularly as our lack of spare berth capacity makes it challenging to recover from supply chain and schedule disruptions. The Port of Tauranga Stella Passage development remains critical to providing the resilience the New Zealand supply chain so desperately needs. Improving productivity, however, will never be at the expense of safety. We encourage honest and full reporting of all incidents and concerns, supported by regular inspections, audits, observations and verifications. Our Total Recordable Injury Frequency Rate for combined Port of Tauranga staff and contractors increased from 16 to 19.5 per million hours worked. While we are not satisfied with that increase, over 95% of these relate to soft tissue sprain and strain type injuries and there are some encouraging underlying indicators in the data. Our days lost per lost-time injury decreased 55%, along with our injury severity rate also decreasing 49%. Our focus remains on continuous improvement, learning from all incidents and strengthening our critical controls. I will now take a closer look at some of the cargo trends over the past year. Total trade volumes were down 3% to 24.6 million tonnes. The biggest impact was from lower log and coal volumes, resulting in export volumes decreasing 3.3% to 15.9 million tonnes and imports decreasing 2.3% to 8.7 million tonnes. Log exports decreased 8.1% to 5.8 million tonnes, affected by higher fuel prices that prompted some exporters to reduce harvesting in the second half of the financial year. Coal imports decreased 64.8% as stockpiles at Huntly Power Station stabilised, and South Island hydro generation was sufficient to avoid coal-fired generation over winter. Cargo volumes increased for dairy, up 3.9%, with kiwifruit growing 8.5% to a record volume of 754,000 tonnes, with growth expected to continue. Together, the strong dairy and kiwifruit volumes contributed to another record year for refrigerated export containers. Container volumes overall remained resilient, increasing just under half a percent to 1.21 million TEUs. We had 79 cruise ship visits for the year and are expecting about the same number this coming season. The first of which arrived on 13 October. Air and stormwater quality remain a major focus. Whilst we continue to meet all the conditions in our stormwater resource consents, we take a continuous improvement approach to our environmental performance. To that end, in April we opened a new stormwater treatment facility at our Mount Maunganui wharves. The new system captures the “first flush” of a heavy rain event and can hold up to one million litres for treatment before it is released. As Julia mentioned, we are excited to be in possession of New Zealand’s first fully electric straddle carrier, which we will be trialling over the next year. It will give us the opportunity to test performance and charging infrastructure within our unique operating environment. The $3.5 million trial is being supported by the energy efficiency and conservation authority (EECA), and if successful, we will be able to introduce additional electric straddles to our fleet. In the meantime, our six new hybrid straddles will bring our total hybrid fleet to 13, representing a quarter of our total straddle fleet. In another New Zealand first, our new hybrid tug is under construction in Turkey and due for delivery mid-2027. The 32-metre rotortug will have at least 80 tonnes of bollard pull, compared to the 50-tonne tug it is replacing. This will give us greater capability for the larger vessels we expect to see in future. The current capital dredging is also in preparation for larger vessels and will allow the largest of the ships already calling here to transit at both low and high tide. This should give us some more flexibility while we wait for the much-needed capacity provided by the Stella Passage expansion. We are deepening the shipping channel to allow for vessels of up to 15.5 metres in draught. Our investments to accommodate bigger ships are important for New Zealand’s decarbonisation efforts. Larger ships are more efficient and produce fewer greenhouse gas emissions per container. We made good progress in reducing our own greenhouse gas emissions over the past year, with overall Scope 1 and 2 emissions decreasing by 12% and emissions intensity per cargo tonne reducing by 9%. Before I finish, I will give you a quick update on trade in the first quarter of the 2027 financial year. Total trade volumes for the three months ended 30 September were 6.25 million tonnes, down 4.8% and reflecting the continued impact of elevated fuel costs on the export log market. Container volumes were 311,000 TEUs, down 2.6% on the previous year. Based on the first quarter’s cargo volumes, and notwithstanding any significant changes to trading conditions or events beyond our control, we expect full-year underlying Group Net Profit After Tax to be in the range of $160 million to $175 million. There are a number of uncertainties, including the ongoing conflict in the Middle East, the impact of high fuel prices, particularly on log exports, as well as broader trade policy settings. Frustratingly, we also remain capacity-constrained at the container terminal until the Stella Passage development can be completed. We do, however, remain confident in our future, thanks to our operational strength, quality infrastructure, diversity of cargo and revenue streams, as well as strong customer relationships and a clear strategy for growth. None of our achievements over the past year would be possible without the dedication and effort of our people. I would like to thank the team for their hard work and commitment throughout the year. Thank you also to our customers, business partners and service providers for your continued support, as well as to the communities we serve in the Bay of Plenty and beyond. Finally, I would like to acknowledge the continued trust and support from our shareholders. Thank you for joining us today in person and online. Together, we continue to connect New Zealand and the world. Ngā mihi nui ki a koutou katoa. Thank you.