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Speaker 1: We'd like to interview you about how we can make

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Speaker 1: Shared Lunch better. We've got a survey happening right now

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Speaker 1: and we'd love your feedback. It just takes a few minutes,

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Speaker 1: and if you're a New Zealand resident, you can go

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Speaker 1: on the drawer to one of six fifty.

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Speaker 2: Dollars hsi's gifts.

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Speaker 1: The link is in our show notes right now.

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Speaker 3: Kurta and welcome to this episode of Shared Lunch where

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Speaker 3: we go to Sonny Hawk's Bay and one of the

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Speaker 3: biggest listed entities in the region, Napier Port. So why

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Speaker 3: is an island nation like New Zealand so reliant on

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Speaker 3: ports and would you invest in one?

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Speaker 2: I'm your host, Halen Madison.

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Speaker 3: And to discuss this, I'm joined by CEO of Napier Port,

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Speaker 3: Todd Dawson.

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Speaker 4: Investing involves risk, you might lose the money you start with.

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Speaker 4: We recommend talking to a licensed financial advisor. We also

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Speaker 4: recommend reading product disclosure documents before deciding to invest. Everything

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Speaker 4: you're about to see and here is current at the

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Speaker 4: time of recording.

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Speaker 3: Hi Todd, thanks for coming down from Napier to join.

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Speaker 2: Us in the studio.

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Speaker 5: You're welcome. It's really nice to be here on this

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Speaker 5: a little bit wet day in Willington.

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Speaker 3: Yeah, so it can't do much about the weather now, Todd,

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Speaker 3: You've been at the Helm at Napee Port for around

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Speaker 3: about six and a half years, I think, and it

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Speaker 3: will be fair to say that you've got a background

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Speaker 3: in tech and logistics. I think Quartahi Logistics and IBM

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Speaker 3: were a couple of the places you've worked prior, and

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Speaker 3: you also made the move from Auckland, so I'm interested

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Speaker 3: to see what made you.

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Speaker 5: Do that, you know, that's that's pretty fair summary of

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Speaker 5: my background. Definitely in the in the in the in

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Speaker 5: the freight logistics sector, supply chain and some fantastic ears

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Speaker 5: at IBM as well, which gave me a really good

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Speaker 5: broad exposure to lots of different types of businesses. So yeah, no,

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Speaker 5: it's it's an interesting sector to work in. Lots of

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Speaker 5: challenges day to day challenges, but also sort of thinking

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Speaker 5: about what the future holds for supply chains and how

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Speaker 5: they're going to change and adapt over time. And yeah,

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Speaker 5: it was quite a change for myself and my family

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Speaker 5: to move out of Auckland. Of an Auckland born and

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Speaker 5: bred feller, but always sort of thought it would be

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Speaker 5: quite cool to go and live somewhere else in New

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Speaker 5: Zealand and more regional, and when the opportunity came up

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Speaker 5: to go to nap Purport, it'd take on the CEO role.

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Speaker 5: It was a bit of a no brainer really. It

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Speaker 5: was a great move for me personally in my career,

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Speaker 5: but equally and some amazing challenges that we've had going

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Speaker 5: through there, and equally for the family. It's been a

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Speaker 5: wonderful place for us to live and experience growing kids

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Speaker 5: up in the Hawk's Bay, which is awesome.

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Speaker 3: Before we get into perhaps some of the changes that

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Speaker 3: might have happened in that six and a half year tenure,

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Speaker 3: perhaps if we look at where nape You Port is

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Speaker 3: nationally and globally, I mean it's i think the fourth

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Speaker 3: largest in New Zealand.

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Speaker 5: It's a very highly productive region. You know, we're very

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Speaker 5: export dominated port eighty percent roughly in ternsi of exports,

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Speaker 5: twenty in terms of import flows. And then you know,

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Speaker 5: in terms of the actual split of the makeup of

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Speaker 5: the port as well, we're a very diverse port. If

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Speaker 5: you look at Napei Port and from the air, you know,

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Speaker 5: half of its sort of containers, but then all actually

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Speaker 5: probably a better A third of it is sort of

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Speaker 5: container and then the rest of it is all around

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Speaker 5: the bulk trades and other types of trades that go

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Speaker 5: through our port as well as a cruise industry as well,

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Speaker 5: so because we're very attractive area for cruise ships to

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Speaker 5: come visiting. So it's a real diverse mix that comes

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Speaker 5: through the port, which means we have to be very

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Speaker 5: dynamic and how we utilize the port as well. And yeah,

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Speaker 5: it's a neat place to be to sictually just come

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Speaker 5: back from China having a look at some of the

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Speaker 5: ports over there and in the numbers and scale and

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Speaker 5: places like that internationally, they're huge. You know, we're on

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Speaker 5: a good year, we're still somewhere between two hundred and

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Speaker 5: fifty two hundred and seventy thousand odd containers going through port.

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Speaker 5: You know, I was in visiting ports at ten ten

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Speaker 5: million to tu or twenty four equivalent units containers going

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Speaker 5: through those ports. So it's a real change of mindset

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Speaker 5: in terms of the scale that you see overseas. But

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Speaker 5: the technology is different, how they operate, it's completely different

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Speaker 5: to what we do in terms of that scale and

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Speaker 5: what they can do and deploy in terms of assets

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Speaker 5: and infrastructure and things. And yeah, we got some unique

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Speaker 5: challenges at Napi Port, and that's a busy, busy place.

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Speaker 5: When I arrived there six and a half years ago,

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Speaker 5: you know, there was a lot of talk about, you know,

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Speaker 5: the port needed to expand. It was all about big

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Speaker 5: ships and things like that. But actually the region's been

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Speaker 5: growing and growing exponentially in terms of its trade and

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Speaker 5: volume and things like the wall of wood coming on,

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Speaker 5: and our need to grow was really being driven out

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Speaker 5: of congestion issues having the right infrastructure in the port

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Speaker 5: to be able to allow the region to continue to grow.

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Speaker 3: If we look at export and imports, is it around

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Speaker 3: about ninety percent of these actually come I see, So

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Speaker 3: sort of put some perspective the importance of a port,

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Speaker 3: regardless of where it is.

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Speaker 5: Perhaps, yeah, absolutely reports so critical to New Zealand's economy.

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Speaker 5: Over ninety percent of what we produce goes out through

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Speaker 5: a port via sea to our international markets. Well over

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Speaker 5: ninety percent of what New Zealand producers goes above the equator.

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Speaker 5: So New Zealand is heavily dependent on an efficient supply

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Speaker 5: chain through to ports, A good shipping network coming through

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Speaker 5: New Zealand and to be able to reach our global markets,

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Speaker 5: which is where we get our income from. We are

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Speaker 5: a unique place in terms of where our population is

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Speaker 5: based along a long, skinny, narrow couple of islands. Most

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Speaker 5: of our imports go into the Upper North Island, but

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Speaker 5: then all those containers and things that get emptied out

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Speaker 5: up there, they will need to be redirected below the

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Speaker 5: Bombay Hills primarily to where we produce stuff, and that

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Speaker 5: generally comes out of places like Hawk's Bay. So we

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Speaker 5: need to have good shipping links and good connectivity to

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Speaker 5: those shipping links from the land side to get our

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Speaker 5: products to market.

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Speaker 3: So when we talk about the revenues that you would have,

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Speaker 3: what's the waiting, what's the breakup? You talked about cruise ships,

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Speaker 3: you talked about bulk goods, cargo, I mean, and what

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Speaker 3: what is some of that cargo?

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Speaker 5: Yeah, so we have if you break up our revenue

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Speaker 5: streams into primarily three main buckets, we have our container trade,

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Speaker 5: our bulk trade, and our primarily our cruise trade. We

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Speaker 5: had in smaller other ancillary pieces as well, and leases

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Speaker 5: and other things that we generate and come from, but

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Speaker 5: primarily about just under sixty percent fifty seven fifty eight

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Speaker 5: percent of our revenue is linked to the container trade,

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Speaker 5: and the other thirty five percent is linked to our

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Speaker 5: bulk trades primarily made up of logs and the log exports,

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Speaker 5: and then the remaining trades. Somewhere in that five to

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Speaker 5: seven percent ranges is cruise cruise industry, and that's in

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Speaker 5: the last couple of years really, since COVID come back

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Speaker 5: really strongly and has good growth in it in the

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Speaker 5: future as well.

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Speaker 3: Because one thing for most New Zealanders when you think

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Speaker 3: about aport, we probably.

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Speaker 2: Think about containers.

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Speaker 3: We think about ships, quite traditional view, whereas I think

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Speaker 3: logistics with tech and the like, has probably moved on

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Speaker 3: a fair bit. There's also been obviously supply chain issues

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Speaker 3: with COVID and and other issues.

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Speaker 2: The likes of main Freight.

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Speaker 3: Reported recently and they were disappointed in their results because

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Speaker 3: of some of the challenges, which I assume that.

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Speaker 2: You guys would have seen as well.

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Speaker 3: But what are some of those newer sort of revenue

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Speaker 3: streams you're looking at, Well, what's the potential for a port?

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Speaker 5: Yeah, okay, So most of our revenue and our income

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Speaker 5: and things gets generated through the activity that goes across

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Speaker 5: our wharfs. But what I think you're seeing in terms

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Speaker 5: of across the supply chain is bigger players, the likes

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Speaker 5: of your big shipping lines you immergsy CMA's port companies,

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Speaker 5: some of the bigger freight forwards, the likes of main

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Speaker 5: freights and things that have good assets across a large

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Speaker 5: network expanding their services upstream and downstream and the supply chain.

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Speaker 5: So you know, we're doing the same here in NAPI

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Speaker 5: Port as well. You know, we're looking at how we

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Speaker 5: actually extend the reach of the port, whether that's through

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Speaker 5: providing technology but also critical links into infrastructure, so where

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Speaker 5: that's roading and rail links and warehousing links to allowed

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Speaker 5: us to extend the reach of the port and provide

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Speaker 5: a seamless supply chain experiences for customers in the cargo

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Speaker 5: that's flying through on either out of there in what

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Speaker 5: we call the hinterland further afield from the port, making

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Speaker 5: sure there's good connectivity in terms of those that infrastructure

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Speaker 5: where it's road and rail shipping, coastal shipping links through

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Speaker 5: to the port to get that cargo going over our wharfs.

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Speaker 5: The other piece of that is that's significant investment going

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Speaker 5: in around making supply chain easier to transact. With new

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Speaker 5: systems and technology coming on stream that makes it easier

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Speaker 5: for people will interact with their service providers, giving them

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Speaker 5: additional visibility into the supply chain as well, and that's

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Speaker 5: become far more and more important as people want to

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Speaker 5: be able to order something straight off their phone. They

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Speaker 5: don't want to have to lift the phone up and

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Speaker 5: wring this person or talk to that person. They want

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Speaker 5: to seamless experience, particularly the consumer end, and then they

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Speaker 5: want things that's an instantaneous gratification. I want it there

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Speaker 5: the next day, And so the supply you have to

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Speaker 5: wes to work really, really smoothly, and when it doesn't,

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Speaker 5: you see some of those issues appear, and suddenly the

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Speaker 5: supply chain becomes more important in everybody's lives, and I

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Speaker 5: think COVID was a great example of that. Prior to COVID,

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Speaker 5: to the supply chain and ports and ships and trucking

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Speaker 5: companies and things, we're probably just in the back of

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Speaker 5: people's minds. It didn't really worry too many people. But

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Speaker 5: when things go wrong suddenly it's like, Wow, what do

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Speaker 5: you mean I can't get my goods tomorrow? What's going

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Speaker 5: on there? And understanding that all that background work has

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Speaker 5: to work seamlessly in order for the customer to get

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Speaker 5: a good experience, in order for the products to be

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Speaker 5: on the shelf when you want them. And there's a

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Speaker 5: lot of systems, technology and processes behind the scenes that

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Speaker 5: have to work smoothly for that to happen, as well

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Speaker 5: as great people as well of seat to deliver it. Also,

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Speaker 5: we are looking at how we extend our reach through

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Speaker 5: services like viewpoint. We've just launched a new new business

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Speaker 5: in the market. We've been working on that for a couple.

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Speaker 3: Of years, so the people or the partners involved aren't here.

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Speaker 2: Were rail as.

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Speaker 5: One, Yeah, Qui rails one. And we've got other trucking companies,

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Speaker 5: local truck companies and things that also help us out.

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Speaker 5: But what that's all about is we have great visibility

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Speaker 5: to port as to the flow of goods that are

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Speaker 5: coming into the port and also out of the port.

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Speaker 5: And what we see is there's a lot of inefficiency

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Speaker 5: in the supply chain where those flows aren't well connected

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Speaker 5: and all balanced onto the assets through at that are

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Speaker 5: moving today. So there's a lot of waste in an

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Speaker 5: efficiency sometimes in what we call the network. There the

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Speaker 5: supply chain network where you might see a train running

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Speaker 5: full one way but empty the other, and because we

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Speaker 5: have the visibility around the import flows and export flows,

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Speaker 5: we can start to look at that train and say, well,

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Speaker 5: how do I optimize that train to make sure it's

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Speaker 5: full going in and going out, but still meeting the

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Speaker 5: delivery times of the cargo that's flowing, and then bring

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Speaker 5: the whole costers supply chain down and if it does well,

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Speaker 5: how do we make that a benefit to the customers

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Speaker 5: that are actually on those trains or on those trucks

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Speaker 5: to lower the cost for the consumer and make New

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Speaker 5: Zealand more competitive.

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Speaker 3: The economy has been pretty challenging too in the last

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Speaker 3: little while. We'll get to cyclone Gabriel shortly, but I

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Speaker 3: mean it's fair to say that interest rates are higher,

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Speaker 3: there's many challenges for businesses, and you guys probably aren't

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Speaker 3: immune to that. So how have you coped with that?

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Speaker 5: Things like insurance costs and fuel costs and things are

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Speaker 5: massive for our business. So we've just had to really

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Speaker 5: focus and knuckle down on one of our key priorities

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Speaker 5: where we really need to be able to have the

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Speaker 5: right resources in place to deliver those services. We've concentrated

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Speaker 5: on making sure that we can moove resources on the

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Speaker 5: port to where they as demand and being as flexible

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Speaker 5: and adaptable as possible throughout those circumstances to make sure

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Speaker 5: we continue to deliver the service customers need to and

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Speaker 5: just sort of knuckle down and try and write it

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Speaker 5: out what we're doing at the moment.

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Speaker 3: Yeah, that's that's all you can do, really, and that

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Speaker 3: also Todd brings me to your half year results which

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Speaker 3: came out on the twenty second of May, so a

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Speaker 3: few weeks ago. Now, it was a fairly robust result. However,

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Speaker 3: the underlying profit I think was up about forty eight percent,

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Speaker 3: around about eleven million. Now that doesn't include all that. Sorry,

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Speaker 3: that does take out the insurance claim that you did

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Speaker 3: have with cyclone, Gabriel, So maybe talk us through that

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Speaker 3: result and maybe what the outlook is.

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Speaker 5: Yeah, it was a nice result to be able to deliver.

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Speaker 5: It was really came off the back of some really

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Speaker 5: strong volumes coming through our port optic. In the bulk side,

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Speaker 5: we had the benefit of some good log volumes coming

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Speaker 5: through the cruise season coming back on our container volumes. Obviously,

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Speaker 5: I'm still a little depressed given the cyclone effects and

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Speaker 5: also just the general economy is slower. So all across

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Speaker 5: most ports in New Zealand at moment you're seeing slightly

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Speaker 5: lower import volumes and lower export volumes and we're the same.

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Speaker 2: Is that a world economic.

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Speaker 4: Yeah?

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Speaker 5: And I think you know, New Zealand's market, key market,

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Speaker 5: particularly things like China. China, Yeah, is still you know,

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Speaker 5: it's still rebuilding post COVID, you know, I think they

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Speaker 5: haven't fired as much as what we would hope have

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Speaker 5: hoped them to fire straight after coming at out of COVID,

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Speaker 5: But they are on the rebuild. I've just been up

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Speaker 5: there and it's a reasoning positive sort of mood. But

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Speaker 5: that's still flying through in terms of container volumes we're

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Speaker 5: seeing through both napy Port and other ports around New Zealand.

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Speaker 5: At the moment, it's slightly lower economy and domestic economy

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Speaker 5: is also slowed, so imports are certainly a key factor

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Speaker 5: in that.

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Speaker 3: What are the other markets, though, Todd Besides China? We

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Speaker 3: talk about that a lot because obviously it's our major

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Speaker 3: trading partners, but are there other markets like Japan or

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Speaker 3: ones that we haven't done as much with but maybe

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Speaker 3: we're doing more trade.

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Speaker 5: With Yeah, I think you're seeing a lot of the

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Speaker 5: exporters really concentrate into that Southeast Asia area merging markets,

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Speaker 5: you know, around Vietnam and Indonesia, big focus in the

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Speaker 5: air at the moment. India seems to be the hot

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Speaker 5: topic as well. We've actually seen a couple of shipments

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Speaker 5: coming out of that report and the log trade that

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Speaker 5: are going towards India, which is you know, it's not new,

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Speaker 5: but it's it's a bit more focused in those those

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Speaker 5: sort of merging markets, which is good to see. And

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Speaker 5: of course those traditional markets that you know, Europe and

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Speaker 5: the Americas are still really really important and make up

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Speaker 5: a big component of what we see flying out of

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Speaker 5: out of nap Port.

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Speaker 3: Now. Todd thinking about cyclone Gabriel, that obviously has had

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Speaker 3: an impact. It was after COVID's a pretty tough altogether.

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Speaker 3: But are you seeing things come back or did I

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Speaker 3: also see a number.

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Speaker 2: Where actually it created.

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Speaker 3: More revenue, more logs that you're shipping and the like.

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Speaker 3: Because obviously of the you know what.

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Speaker 5: Happened, there's a few things going on there post cyclone,

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Speaker 5: we obviously had some massive impacts on some of the

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Speaker 5: key trades. Pan Pack is a big forest owner, pulp

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Speaker 5: and timber producer, only fifteen kilometers or so down the

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Speaker 5: road from the port. They got wiped out, effectively, their

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Speaker 5: whole manufacturing facilities flooded in the data with silt and things,

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Speaker 5: and so they've been rebuilding and it's a massive plant

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Speaker 5: to rebuild, and so that they represent a significant portion

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Speaker 5: of our total volume when you take into account the

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Speaker 5: logs that they pushed through the port, the pulp and

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Speaker 5: the milled lumber. Probably in terms of tonnage close to

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Speaker 5: court of the tonnage that comes through that report is

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Speaker 5: some way, shape or form related to the pan Pac.

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Speaker 5: Really pleasing to see that their owner's og fiber Japanese

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Speaker 5: owned business got straight in there and started to rebuild,

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Speaker 5: and they have been rebuilding. Their timber mill opened up

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Speaker 5: in November this year and their timber mills pretty much

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Speaker 5: back to one hundred percent now, and their pulp mill

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Speaker 5: has started production and started to do some of first

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Speaker 5: exports again, just started just the end of March, so

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Speaker 5: that they would be expecting to be back to full

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Speaker 5: production by the end of the year. But you know

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Speaker 5: the apple industry as well, there was a lot of

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Speaker 5: publicity around that some huge amounts of pain through that

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Speaker 5: through that sector. In terms of what happened, they were

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Speaker 5: probably around about ten to fifteen percent down in terms

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Speaker 5: of volume on what they would otherwise have expected to

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Speaker 5: export it this year. So we're tracking it around twenty

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Speaker 5: twenty two. And you know what would have been traditionally

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Speaker 5: perhaps container space on the port moved that to logs

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Speaker 5: because some of the logs it would have otherwise gone

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Speaker 5: at the pan pack for processing then went out as

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Speaker 5: just raw logs for export. We suddenly had a wood

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Speaker 5: chip pile because the woodchip that would have gone through

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Speaker 5: the pulp mill needed to go somewhere else, and so

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Speaker 5: we quickly adapted and created an export area for managing woodchip.

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Speaker 5: And so I'm really proud of my team as well

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Speaker 5: because they had to flex and respond and suddenly they

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Speaker 5: were doing this job today. But now tomorrow you're going

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Speaker 5: to do this job. And we're just working about how

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Speaker 5: we actually cope with the dirt from demand coming through

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Speaker 5: the gate and moving our resources around flexibly. So when

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Speaker 5: the volumes do come, you're really seeing those numbers start

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Speaker 5: to look quite attractive in terms of what the port

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Speaker 5: can do. And the upside is that we still see

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Speaker 5: volume growth coming back as things like pan pak do

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Speaker 5: get back to full full production capability. You're still seeing

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Speaker 5: some good positive signs coming back into the hot sector

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Speaker 5: that are pretty down in the mouth after the soatplane.

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Speaker 5: But it's really pleasing to see investment going And one

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Speaker 5: of the exporters I work really closely with all the time,

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Speaker 5: a few months afterwards he's out there replanting trees in

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Speaker 5: the ground and investing in the apple industry too. So

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Speaker 5: there's good growth projected into the future and that's really

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Speaker 5: nice to see as well. And I think there's a

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Speaker 5: bit of a say, a bit of a malaise across

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Speaker 5: the New Zealan economy at the moment, and farmers are

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Speaker 5: doing it pretty tough, and the costs are high and

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Speaker 5: things and prices aren't great. The fantastic thing that we've

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Speaker 5: demonstra I think is that resilience and equi that diversity

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Speaker 5: of trade and the fact that what we produce is

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Speaker 5: food and fiber and the people in the world still

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Speaker 5: need to eat yea, and they still need to clothe

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Speaker 5: themselves and need to house themselves, and that's what we

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Speaker 5: produce and that's not going to change. There does a

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Speaker 5: matter where there's a COVID outbreak or massive cyclone or

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Speaker 5: wars or whatever around the world, and there's always a

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Speaker 5: lot of uncertainty going on. What New Zealand produces the

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Speaker 5: world wants and that's what the Hawks Bay producers and

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Speaker 5: that's what goes through our port. So that's a nice

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Speaker 5: thing to be able to lean back on. We don't

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Speaker 5: rest on our laurels, but it's certainly we've set the

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Speaker 5: platform now. I think the opportunity is there for may

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Speaker 5: be porught to really produce some good results in the

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Speaker 5: future too.

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Speaker 3: Yeah, focusing on sherholders and the retail investor, I think

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Speaker 3: you were paying a dividend of three cents, which is

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Speaker 3: at one point seven on the prior period. Also, looking

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Speaker 3: at the register, you're fifty five percent owned I think

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Speaker 3: by Hawk's Bay Regional Council. How does that have a

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Speaker 3: bearing on what you do.

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Speaker 5: Yeah, council is a great shareholder to have. They provide

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Speaker 5: stability for us. I think, you know, from a from

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Speaker 5: a business perspective, they let us get on with our

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Speaker 5: own own thing. They're not in their dabbling in bits

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Speaker 5: and pieces. But we went through the IPO back in

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Speaker 5: twenty nineteen. It was as a really interesting experience to

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Speaker 5: go through from a core shareholder perspective. The regional Council

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Speaker 5: did very well out of it in terms of being

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Speaker 5: able to de risk the overall portfolio. They had a

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Speaker 5: lot of their investments tied up in one major asset,

390
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Speaker 5: being the port, and been able to reuse that money

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Speaker 5: to deliver and do other things for the community. And

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Speaker 5: from our perspective, what that also did was it gave

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Speaker 5: us a broader base of investors that were already in

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Speaker 5: there supporting us, but also holding us to account as well.

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Speaker 5: And I think you know a lot of businesses around

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Speaker 5: around New Zealand that you know, whole owned subsidiaries of

397
00:20:01,160 --> 00:20:04,320
Speaker 5: a council or government, ground entities and bits and pieces

398
00:20:05,040 --> 00:20:08,879
Speaker 5: could really benefit from that additional scrutiny that either commercial

399
00:20:08,880 --> 00:20:12,800
Speaker 5: investors or retail investors bring to businesses. And you know,

400
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Speaker 5: what it also did was allowed us to be able to,

401
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Speaker 5: you know, take the proceeds from the IPO and reset

402
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Speaker 5: our balance sheet to be able to invest in the

403
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Speaker 5: sixth warf or to Fitty as we know her, and

404
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Speaker 5: set up the port with good infrastructure for the next

405
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Speaker 5: few decades. And it gave us the funding mechanisms to

406
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Speaker 5: be able to do that, and it stood up to

407
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Speaker 5: the test of scrutiny from external investors as well. So

408
00:20:37,480 --> 00:20:40,919
Speaker 5: that's that transparency that we get being on the listed entity,

409
00:20:41,359 --> 00:20:43,680
Speaker 5: the scrutiny that we get around what we invest in

410
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Speaker 5: the value that gets returned. It's been a good process

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Speaker 5: to go through and the Council's benefited from that as well.

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Speaker 5: You know, when we went through the IPO, the value

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Speaker 5: of their asset even they went down from one hundred

414
00:20:54,240 --> 00:20:57,680
Speaker 5: percent to fifty five doubled, so you know, from a

415
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Speaker 5: balance sheet perspective for them, also beneficial because that's put

416
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Speaker 5: them in a good position. I mean things like cyclones

417
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Speaker 5: go through to have a better base of financial support

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Speaker 5: to be able to address those issues that they've got.

419
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Speaker 5: And let's face it, acrossing these cell and lots of

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Speaker 5: councils and the Crown, the Crown has some big challenges

421
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Speaker 5: in terms of investing in infrastructure and at public private

422
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Speaker 5: partnership approach that we've demonstrated success in has gone really

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Speaker 5: really well. We invested one hundred and seventy three million

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Speaker 5: dollars in a new wharf and we delivered at six

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Speaker 5: months ahead of schedule and under budget. So I think

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Speaker 5: we're a good example for New Zealand to look to

427
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Speaker 5: around how do you do infrastructure and do it well

428
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Speaker 5: and leverage the balance sheet? That actually is some of

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Speaker 5: these councils have and look at alternative funding mechanisms. And

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Speaker 5: let's face it as well, there's lots of people that

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Speaker 5: want to put their money into cold, well run businesses

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Speaker 5: around the place.

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Speaker 3: Yeah, there's a real demand among retail investors. It's for

434
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Speaker 3: you to say for infrastructure, and there hasn't been that

435
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Speaker 3: many opportunities, so I suppose NAPI Port could be one

436
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Speaker 3: of those.

437
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Speaker 2: How important are the retail.

438
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Speaker 3: Investors given that you've got a number of different institutional

439
00:22:05,800 --> 00:22:07,960
Speaker 3: investors as well, probably on the register.

440
00:22:08,560 --> 00:22:10,440
Speaker 5: Yeah, I think they're really important, and you know that's

441
00:22:10,440 --> 00:22:12,159
Speaker 5: why I'm here today as well. You know, we have

442
00:22:12,280 --> 00:22:15,280
Speaker 5: to talk to our retail investors. I think you know

443
00:22:15,320 --> 00:22:18,000
Speaker 5: that there can be a large they might have small holdings,

444
00:22:18,600 --> 00:22:20,320
Speaker 5: but it can be a large number of them, and

445
00:22:20,400 --> 00:22:22,880
Speaker 5: those large numbers can influence the share price quite quickly

446
00:22:22,960 --> 00:22:25,760
Speaker 5: as well in terms of their training. But you know,

447
00:22:25,920 --> 00:22:28,160
Speaker 5: we're conscious that those people are investing their own money.

448
00:22:29,160 --> 00:22:31,800
Speaker 5: They're out there not investing someone else's money. They're actually

449
00:22:31,800 --> 00:22:34,320
Speaker 5: in there taking an interest in investing it for their future,

450
00:22:34,359 --> 00:22:36,919
Speaker 5: their life goals or whatever they might have. Take that

451
00:22:36,960 --> 00:22:39,119
Speaker 5: seriously as a responsibility to be able to help them

452
00:22:39,240 --> 00:22:42,800
Speaker 5: get and achieve those goals. And then they're doing it

453
00:22:42,840 --> 00:22:46,840
Speaker 5: with in company of people like the commercial investors, who

454
00:22:46,880 --> 00:22:49,439
Speaker 5: really do hold us to account in terms of what

455
00:22:49,440 --> 00:22:51,879
Speaker 5: we're doing and how we're doing it, and ask the

456
00:22:51,920 --> 00:22:54,600
Speaker 5: hard questions of us, and we provide that transparency. So

457
00:22:55,160 --> 00:22:57,800
Speaker 5: we think the retail investors are really important to our mix.

458
00:22:58,520 --> 00:23:02,080
Speaker 5: And equally the other thing that we like as well,

459
00:23:02,119 --> 00:23:05,760
Speaker 5: and how we've been able to take this IPO process

460
00:23:05,800 --> 00:23:09,119
Speaker 5: forwards our employees. Our employees are you know, when we

461
00:23:09,160 --> 00:23:11,439
Speaker 5: did the IPO, ninety seven percent of our people were

462
00:23:11,480 --> 00:23:15,480
Speaker 5: game shareholders, which is fantastic. You know, they've all got

463
00:23:15,520 --> 00:23:17,600
Speaker 5: skin in the game. They're all looking at how the

464
00:23:17,640 --> 00:23:21,640
Speaker 5: port's performing a bit and that's great and I think

465
00:23:21,680 --> 00:23:23,800
Speaker 5: that's good for our other investors as well, knowing that

466
00:23:23,840 --> 00:23:28,280
Speaker 5: the employees are really invested in the port and its results,

467
00:23:28,800 --> 00:23:30,760
Speaker 5: and that's that's neat for me too because it means

468
00:23:30,760 --> 00:23:32,680
Speaker 5: by people care just that extra bit.

469
00:23:33,200 --> 00:23:37,040
Speaker 3: Yeah, So they actual retail investor cohort. Are they from

470
00:23:37,080 --> 00:23:38,960
Speaker 3: all over New Zealand or is it more in the

471
00:23:38,960 --> 00:23:39,600
Speaker 3: Hawk's Bay?

472
00:23:39,720 --> 00:23:40,440
Speaker 2: What would you say?

473
00:23:40,560 --> 00:23:42,840
Speaker 5: Yeah, look there there is certainly a huge interest in

474
00:23:42,880 --> 00:23:46,119
Speaker 5: the Hawk's Bay, but yes, spread right throughout New Zealand.

475
00:23:47,240 --> 00:23:49,080
Speaker 5: I think when we went through that process, we probably

476
00:23:49,119 --> 00:23:50,800
Speaker 5: could have sold the port to or three times over

477
00:23:51,000 --> 00:23:53,159
Speaker 5: just in the Hawk's Bay. It was that much demand.

478
00:23:53,320 --> 00:23:56,800
Speaker 5: We went through the IPO process, but you know, we

479
00:23:57,240 --> 00:24:00,240
Speaker 5: need to have spread spread of investors across News but

480
00:24:00,280 --> 00:24:03,360
Speaker 5: equally internationally as well. Looking and like you say, there's

481
00:24:03,400 --> 00:24:06,840
Speaker 5: not a lot of opportunities in that infrastructure space for

482
00:24:06,960 --> 00:24:11,040
Speaker 5: investors to take up and then New Zeland market. So

483
00:24:11,119 --> 00:24:13,160
Speaker 5: it was Yeah, it's been.

484
00:24:13,080 --> 00:24:15,639
Speaker 2: Good as a port.

485
00:24:15,800 --> 00:24:19,359
Speaker 3: You're probably unnotice all the time in terms of your

486
00:24:19,560 --> 00:24:20,479
Speaker 3: safety record.

487
00:24:20,560 --> 00:24:23,280
Speaker 2: Can you tell me what is your track record on that?

488
00:24:23,359 --> 00:24:26,040
Speaker 3: Because that would be something that investors would want to

489
00:24:26,080 --> 00:24:26,520
Speaker 3: know about.

490
00:24:27,240 --> 00:24:30,600
Speaker 5: Yeah. Look, ports are big, hairy animals that can when

491
00:24:30,640 --> 00:24:33,200
Speaker 5: they bite, they bite hard and it can really hurt

492
00:24:33,280 --> 00:24:36,919
Speaker 5: or kill somebody. So you know, I've been extremely lucky

493
00:24:37,280 --> 00:24:40,520
Speaker 5: coming into the NAPI port environment where the culture within

494
00:24:40,560 --> 00:24:43,280
Speaker 5: the port around safety was a very positive one and

495
00:24:43,320 --> 00:24:45,960
Speaker 5: it started right at the top, from the board, the

496
00:24:46,080 --> 00:24:50,560
Speaker 5: chair all the way down through the organization. It sounds

497
00:24:50,560 --> 00:24:53,359
Speaker 5: clichees and number one priority. It is a number one

498
00:24:53,400 --> 00:24:56,160
Speaker 5: priority and people go home safe every day. Is never

499
00:24:56,200 --> 00:25:00,480
Speaker 5: a question asked about that, and so that's really brought

500
00:25:00,480 --> 00:25:04,040
Speaker 5: into across the port. Not long after I started, we

501
00:25:04,080 --> 00:25:08,480
Speaker 5: also started a three year of health and safety roadmap journey.

502
00:25:09,119 --> 00:25:12,400
Speaker 5: We were looking at things like our systems and our processes,

503
00:25:12,840 --> 00:25:16,320
Speaker 5: our culture, but equally what we call critical risk and

504
00:25:16,359 --> 00:25:19,920
Speaker 5: assurance programs and critical risks in our environment are things

505
00:25:19,960 --> 00:25:23,480
Speaker 5: that will literally kill you, you know, I get crushed by

506
00:25:23,480 --> 00:25:27,439
Speaker 5: a machine or those sort of things, and how do

507
00:25:27,480 --> 00:25:30,600
Speaker 5: we try and eliminate those risks. You know, we're investing

508
00:25:30,720 --> 00:25:32,760
Speaker 5: significantly in it, just in the last few years, over

509
00:25:32,800 --> 00:25:34,679
Speaker 5: three and a half a million dollars in what I

510
00:25:34,680 --> 00:25:39,320
Speaker 5: would call engineered controls to eliminate risk on the port

511
00:25:39,400 --> 00:25:42,679
Speaker 5: and getting that done consistently across the port is a

512
00:25:42,720 --> 00:25:45,320
Speaker 5: big focus of ours. We also have a lot of

513
00:25:45,320 --> 00:25:48,720
Speaker 5: other businesses operating on our port. You know, there's about

514
00:25:48,800 --> 00:25:51,160
Speaker 5: nine to ten thousand people that come in and off

515
00:25:51,200 --> 00:25:54,040
Speaker 5: the port. Interns of access cards. They have ability to

516
00:25:54,040 --> 00:25:56,400
Speaker 5: come in and do work on the port. There's only

517
00:25:56,400 --> 00:25:59,320
Speaker 5: three hundred and three hundred and thirty Napiport employees, so

518
00:25:59,560 --> 00:26:02,280
Speaker 5: anyone time there'll be four or five hundred people operating

519
00:26:02,320 --> 00:26:06,840
Speaker 5: on our port, and those businesses all have difference understandings

520
00:26:06,840 --> 00:26:09,119
Speaker 5: and systems and processes and things as well. So a

521
00:26:09,119 --> 00:26:11,920
Speaker 5: big part of our responsive ability as a port operator

522
00:26:12,000 --> 00:26:15,199
Speaker 5: is to look at how those businesses also operating on

523
00:26:15,240 --> 00:26:18,720
Speaker 5: our port. There's been a few incidents in my time

524
00:26:18,760 --> 00:26:22,399
Speaker 5: that I'd love to see had not happened, but touch wood,

525
00:26:22,960 --> 00:26:24,919
Speaker 5: we're going okay at the moment and we're seeing the

526
00:26:24,920 --> 00:26:30,560
Speaker 5: incidents reducing. So yeah, it's very we're very passionate about it.

527
00:26:30,600 --> 00:26:32,920
Speaker 2: Is that something that would keep you awake at night?

528
00:26:33,280 --> 00:26:35,760
Speaker 5: No, it doesn't keep me awake up every night. That's

529
00:26:35,760 --> 00:26:40,680
Speaker 5: certainly always in the back of my mind. But yeah,

530
00:26:39,960 --> 00:26:43,159
Speaker 5: it's pleasing to work in an environment now that I

531
00:26:43,160 --> 00:26:47,080
Speaker 5: think we've got the culture mostly right around that.

532
00:26:47,880 --> 00:26:50,320
Speaker 2: What would you say does keep you up at night?

533
00:26:50,400 --> 00:26:51,120
Speaker 2: If anything?

534
00:26:52,200 --> 00:26:54,200
Speaker 5: Right here and now, I think it's you know, where

535
00:26:54,240 --> 00:26:56,800
Speaker 5: the New Zealand economy is at is the state of

536
00:26:56,840 --> 00:27:00,560
Speaker 5: our infrastructure nationally, the roading and rail networks, The investment

537
00:27:00,600 --> 00:27:02,240
Speaker 5: that needs to go on the way that New Zealand

538
00:27:02,280 --> 00:27:06,280
Speaker 5: thinks about infrastructure and needing to invest in that because

539
00:27:06,359 --> 00:27:08,359
Speaker 5: you know, at heart we're all passionate. New Zealand doesn'tant

540
00:27:08,359 --> 00:27:11,040
Speaker 5: to see in zeind do really really well. And I

541
00:27:11,040 --> 00:27:14,960
Speaker 5: think you know, that's sort of probably more what keeps

542
00:27:15,040 --> 00:27:16,840
Speaker 5: us awake at the night at the moment is making

543
00:27:16,840 --> 00:27:19,760
Speaker 5: sure that we've got a whole system that's working well

544
00:27:19,800 --> 00:27:21,000
Speaker 5: from a supply chain perspective.

545
00:27:21,040 --> 00:27:21,200
Speaker 4: Here.

546
00:27:21,960 --> 00:27:24,520
Speaker 3: One other thing todd that retail investors often want to

547
00:27:24,520 --> 00:27:28,080
Speaker 3: know about is the environmental impact of a business like

548
00:27:28,119 --> 00:27:30,399
Speaker 3: a port, and I imagine it could be far and wide.

549
00:27:30,800 --> 00:27:33,720
Speaker 3: What sort of initiatives have you put in place to

550
00:27:34,000 --> 00:27:37,040
Speaker 3: think about that given climate change in the rest?

551
00:27:37,800 --> 00:27:40,480
Speaker 5: Yeah, so a few years ago we started to really

552
00:27:40,520 --> 00:27:43,560
Speaker 5: think hard about this area, particularly off the back of

553
00:27:43,600 --> 00:27:45,600
Speaker 5: doing the big developments like six warf and things. That

554
00:27:45,720 --> 00:27:49,399
Speaker 5: was a real catalyst for us to look at what

555
00:27:49,400 --> 00:27:52,080
Speaker 5: we're doing and how we're doing it. The resource consent

556
00:27:52,119 --> 00:27:55,480
Speaker 5: process that we went through there three or so years

557
00:27:55,480 --> 00:27:59,560
Speaker 5: ago we started, we developed our first sustainability strategy and

558
00:27:59,640 --> 00:28:05,199
Speaker 5: I was advocate of using un STG framework as a

559
00:28:05,280 --> 00:28:07,399
Speaker 5: framework that watched to guide our activities.

560
00:28:07,520 --> 00:28:08,600
Speaker 2: What is that framework?

561
00:28:09,080 --> 00:28:11,320
Speaker 5: It's basically a framework that was put out by the

562
00:28:11,400 --> 00:28:15,720
Speaker 5: UN around looking at sustainability far more in a holistic context,

563
00:28:15,800 --> 00:28:18,320
Speaker 5: not just looking at emissions, but looking at all activities

564
00:28:18,320 --> 00:28:20,920
Speaker 5: and businesses and how they could be, how they could influence.

565
00:28:21,000 --> 00:28:24,600
Speaker 5: And so we've got much better understanding of what is

566
00:28:24,640 --> 00:28:29,240
Speaker 5: our footprint in terms of our emissions, for example, and

567
00:28:29,600 --> 00:28:32,760
Speaker 5: how we're going to adapt and change our technology over

568
00:28:32,880 --> 00:28:36,080
Speaker 5: time to be able to see those come down and

569
00:28:36,320 --> 00:28:39,760
Speaker 5: building that back into our asset management plan because as

570
00:28:39,760 --> 00:28:42,480
Speaker 5: a port, we use a lot of equipment that uses

571
00:28:42,480 --> 00:28:43,120
Speaker 5: a lot of diesel.

572
00:28:44,400 --> 00:28:45,680
Speaker 2: Yeah, I was going to say, yeah.

573
00:28:46,040 --> 00:28:48,120
Speaker 5: So ninety percent of our missions come from our plant

574
00:28:48,120 --> 00:28:52,440
Speaker 5: and equipment, our marine fleet and our cranes, and of

575
00:28:52,440 --> 00:28:54,720
Speaker 5: course there's millions of dollars tied up in those. You

576
00:28:54,760 --> 00:28:57,520
Speaker 5: don't just turn them off and change the more to

577
00:28:57,600 --> 00:29:01,440
Speaker 5: electric or hydrogen powered ones or whatever overnight. So we've

578
00:29:01,480 --> 00:29:05,360
Speaker 5: got a plan around our asset management system as to

579
00:29:05,600 --> 00:29:08,280
Speaker 5: when we'll transition those over time into new types of

580
00:29:08,280 --> 00:29:11,680
Speaker 5: technology or more efficient technology that sees our emissions come

581
00:29:11,720 --> 00:29:14,040
Speaker 5: down over time as well. And then we've been enough

582
00:29:14,040 --> 00:29:15,720
Speaker 5: to do some really neat things, like I say, off

583
00:29:15,720 --> 00:29:18,360
Speaker 5: the back of the six warf project. We were the

584
00:29:18,400 --> 00:29:20,480
Speaker 5: first port in the country to have an on port

585
00:29:20,640 --> 00:29:25,040
Speaker 5: penguin sanctuary. We had to read about that. Now during

586
00:29:25,080 --> 00:29:28,000
Speaker 5: the during the construction process, we went around and we

587
00:29:28,120 --> 00:29:30,320
Speaker 5: discovered now we thought we had a few penguins nesting

588
00:29:30,360 --> 00:29:32,360
Speaker 5: in our in our port balls when it turned out

589
00:29:32,360 --> 00:29:37,360
Speaker 5: we had hundreds and a little blue penguins called really cute.

590
00:29:37,440 --> 00:29:39,920
Speaker 5: And you know, we we built them a new home,

591
00:29:40,000 --> 00:29:45,600
Speaker 5: a new sanctuary and literally re homed penguins by hands

592
00:29:46,240 --> 00:29:49,440
Speaker 5: as we dismantled the port with big diggers and things

593
00:29:49,440 --> 00:29:51,520
Speaker 5: like that, and there were sniffer dogs taking them out,

594
00:29:51,720 --> 00:29:55,280
Speaker 5: rehoming them, micro chipping them. And it's been fantastic working

595
00:29:55,320 --> 00:29:59,040
Speaker 5: with universities and things and the local community to get

596
00:29:59,120 --> 00:30:01,520
Speaker 5: and understand about these little creatures as well.

597
00:30:01,680 --> 00:30:04,080
Speaker 2: So you've kind of got almost like a penguin.

598
00:30:04,040 --> 00:30:05,120
Speaker 3: Colony here we have.

599
00:30:05,200 --> 00:30:07,960
Speaker 5: We've got a penguin colony on our port. Ports are

600
00:30:08,280 --> 00:30:12,000
Speaker 5: fantastic environments wildlife because they're actually you know that we

601
00:30:12,120 --> 00:30:15,200
Speaker 5: have to be secure for one pest free for another,

602
00:30:15,280 --> 00:30:17,920
Speaker 5: so there's no cats and dogs and rats and things

603
00:30:17,920 --> 00:30:21,600
Speaker 5: like that, yea, So we naturally attract animals, particularly marine animals,

604
00:30:21,640 --> 00:30:25,600
Speaker 5: So you know, we've got a black backed gull sanctuary

605
00:30:25,600 --> 00:30:27,720
Speaker 5: on our port just because suddenly there was an area

606
00:30:27,760 --> 00:30:30,760
Speaker 5: that they come in they can feel safe, and so

607
00:30:30,800 --> 00:30:33,200
Speaker 5: we said, well, great, that can be a it can

608
00:30:33,240 --> 00:30:36,360
Speaker 5: be a sanctuary. It's just in the area of the

609
00:30:36,400 --> 00:30:38,440
Speaker 5: port that's sort of set aside. It's not that big,

610
00:30:38,560 --> 00:30:41,240
Speaker 5: maybe twenty thirty meters long, a couple of meters wide

611
00:30:41,440 --> 00:30:46,600
Speaker 5: down by the water. Yeah, And the penguin sanctuary, I

612
00:30:46,640 --> 00:30:48,960
Speaker 5: forget how total big is probably again at one hundred

613
00:30:48,960 --> 00:30:52,720
Speaker 5: meters maybe along and twenty thirty meters wide, and it's

614
00:30:52,760 --> 00:30:54,920
Speaker 5: all planted out with natives and things like that and

615
00:30:54,920 --> 00:30:57,560
Speaker 5: little nesting boxes, and you can go on the YouTube

616
00:30:57,560 --> 00:30:59,640
Speaker 5: and have a look and see them in their nesting

617
00:30:59,720 --> 00:31:03,880
Speaker 5: and it's really neat, really neat. And so that's just

618
00:31:04,280 --> 00:31:06,120
Speaker 5: one of one or two examples of other things that

619
00:31:06,160 --> 00:31:09,600
Speaker 5: we did recently. When we went through the wolf construction project,

620
00:31:09,960 --> 00:31:11,760
Speaker 5: we were able to reuse a lot of the actual

621
00:31:11,800 --> 00:31:14,600
Speaker 5: material from the front of the port, big limestone boulders

622
00:31:14,600 --> 00:31:18,080
Speaker 5: and things, and actually create two new artificial reefs out

623
00:31:18,080 --> 00:31:21,440
Speaker 5: at sea. And we're in an active program monitoring the

624
00:31:21,480 --> 00:31:24,880
Speaker 5: health of those reefs, doing surveys on them and seeing

625
00:31:24,880 --> 00:31:27,640
Speaker 5: marine life that you know, it's just established itself really

626
00:31:27,720 --> 00:31:32,600
Speaker 5: quickly and around those yeah, we're working with local Matifenua

627
00:31:33,120 --> 00:31:38,280
Speaker 5: around voluntary rahuis on those on those reef structures and

628
00:31:38,320 --> 00:31:41,200
Speaker 5: again doing the studies and looking at how the wildlife,

629
00:31:41,600 --> 00:31:44,560
Speaker 5: the biodiversity in the marine environment has been able to

630
00:31:44,560 --> 00:31:47,480
Speaker 5: grow and adapt in those reefs. It's been really fantastic

631
00:31:47,520 --> 00:31:49,880
Speaker 5: to watch. And of course you know we're in the

632
00:31:49,880 --> 00:31:52,080
Speaker 5: marine environment, so we've got a huge interest a lot

633
00:31:52,080 --> 00:31:55,600
Speaker 5: of our people, you know, the fishermen, the recreations in

634
00:31:55,600 --> 00:31:57,960
Speaker 5: the marine and area, got a lot of links into

635
00:31:57,960 --> 00:32:00,840
Speaker 5: the local eree as well, employee base and things, and

636
00:32:00,880 --> 00:32:03,440
Speaker 5: so they care, they really care about what's going on there.

637
00:32:04,200 --> 00:32:04,520
Speaker 2: Lovely.

638
00:32:04,600 --> 00:32:07,520
Speaker 3: Thanks for your insights today, Todd, and thanks to everyone

639
00:32:07,600 --> 00:32:10,520
Speaker 3: for tuning in. Before you go, though, we'd really love

640
00:32:10,560 --> 00:32:13,960
Speaker 3: you to fill out our audience Insights survey. You can

641
00:32:14,000 --> 00:32:16,080
Speaker 3: see it in the show notes. It'll only take a

642
00:32:16,080 --> 00:32:18,400
Speaker 3: few minutes and you'll go in the drawer to get

643
00:32:18,440 --> 00:32:22,560
Speaker 3: fifty dollars towards your portfolio. So stay safe everyone, Thanks

644
00:32:22,560 --> 00:32:25,040
Speaker 3: for joining us, and see you next time on Shared

645
00:32:25,120 --> 00:32:25,440
Speaker 3: Lunch