22
374
Kawhia
(Pine)
planted
1996-1997
270
Waipuna
(Redwood)
planted
2005-2007
150
Whatawhata
(Pine) planted
2001-2002
InvestmentS
Hotels
TGH’s investment in hotels totalled $69
million as atMarch 2013, comprising
the
and
the company’s shareholding in the
HamiltonRiverviewHotel (HRH).
TGHmaintains a 70% controlling
interest in the Tainui AucklandAirport
Hotel Limited (TAAH). Auckland
International Airport Ltd andACCOR
own 20% and 10% respectively. Opened
inMay 2011, with 2013 being the
first full year of operation, the hotel’s
occupancy and roomrates have
exceeded expectations and provided
solid results which are forecast to
strengthen over the coming year.
TGH’s investment inHRHwas one of
the company’s firstmajor financial
investments in 1998. TGHowns 41% of
HRHwhilst Hamilton City Council
(HCC) andAccor own 41% and 18%
respectively. HRHholds total assets
of $44millionwhich are represented
by two hotels within close proximity
of each other,
and
HRH’s performance during the
year was flat as occupancy suffered.
Looking ahead, growth in occupancy
and roomrate is assumed to be average
given the subduedmarket.
Fishing
TGH’s fishing interests total $33
million, and comprise commercial
quota and other assets allocated to
Waikato-Tainui as a result of theMaaori
commercial fisheries settlement with
the Crown.
Under theMaori Fisheries Act 2004,
assets fromthe settlement could only
be transferred to those entities thatmet
the prescribed criteria as aMandated
Iwi Organisation (MIO), andwhich
would bemanaged by an approved
Asset Holding Company (AHC).
TheMIO forWaikato-Tainui is
Waikato-Tainui Te Kauhanganui
Incorporated, and TGH is anAHC.
TGH’s quota investment of $20 million
provides a return of 7%. Snapper and
crayfish are the highest value quota
held. The volume of hoki also provides
a significant contribution to the total
quota.
TGH has an alliance with AHC’s
of Ngaati Raukawa and Ngaati
Maniapoto, and the three iwi have
until now leased out their aggregated
quota, having ceased to run an active
fisheries operation together in 2008.
As mentioned in the CEO’s report on
page 15, TGH, Ngaati Raukawa and
Ngaati Maniapoto have aligned with
Aotearoa Fisheries Limited (AFL) in
a multi-year quota lease arrangement.
In addition, TGH has entered into a
joint management agreement with
Sealord Group Limited to jointly
manage its deep-sea quota. With the
new arrangements in place, it is hoped
that returns from fishing will start to
improve.
WTF holds 5.48% of the income shares
in AFL, an iwi owned company which
provided a dividend toWTF of $0.4
million in December 2012. Separate
financial statements are presented for
WTF from
Agriculture
Farms
TGHowns and operates one drystock
station and has sharemilkers contracted
on two dairy farms. Today the three
farms are valued at approximately
$22million (including Fonterra shares).
The drystock farm, also known as
Hangawera Station, is located near
Morrinsville. It runs 2,500 ewes, 200
cows and approximately 300 trading
cattle. These stock numbers include
approximately 150 bulls that are sold
to the dairymarket each year. TGH
employs two full-time farm staff and
is an active manager of this farm. The
two dairy farms are located on Bankier
Road, Gordonton and Tainui Road,
north of Morrinsville. Both are run
on a 50/50 sharemilker basis with the
farms collectively producing 326,000
kgs of milk solids from approximately
1,000 cows.
TGH is reviewing the agriculture land
portfoliowith a view tomaximising
returns and considering opportunities
to take amore active approach in the
management of these assets as part of a
wider farming system.
Forestry
As a long-term investment in the
TGHportfolio, a total of 795 hectares
is currently planted in trees with a
further 1,074 hectares leased out. The
trees are a mix of Radiata Pine and
Californian Redwood. The latter is well
placed for the New Zealand Emissions
Trading Scheme.
dairy production
kilograms of milk solids
2013
326
2012
325
2011
284
2010
286
2009
266
MS/Kg in thousands
Effective Farm Area by Hectares
250
Tainui Road
(Dairy)
109
Hukanui (Dairy)
650
Hangawera
(Drystock)
Forest by Hectares
