South Port NZ Ltd – Interim Report to 31 December 2021

Interim Report
FOR THE SIX MONTH PERIOD ENDED 31 DECEMBER 2021

Financial Performance
South Port has recorded a steady start to the financial year.
Total bulk cargo volumes were consistent with the previous
financial period and in line with expectations. Container
volumes however were negatively impacted showing a
decline for the same reporting period.
South Port’s net profit after tax (NPAT) for the first six
months of FY2022 was $5.9 million (FY2021 $6.1 million). A
number of factors impacted on this interim result including:
öThe log market is currently in a downward cycle due
to decreased demand and high inventory levels in the
Chinese market. It is not expected that this market
dynamic will improve until the second quarter of 2022.
öInternational container supply chains continue to be
significantly disrupted as a result of the ongoing COVID-19
pandemic.
öCold storage volumes declined due to a reduction in meat
storage and fish vessels calling at the port.
öThere were increased stock food volumes imported into the
region to service the dairy industry.
The reported FY2022 interim profit should be read in
conjunction with the Outlook section of this Report where a
year end NPAT forecast range is provided.
Cargo
Total cargo activity was 1,745,000 tonnes compared with
1,720,000 tonnes in the prior year interim period. This
represents an increase in cargo flows of 25,000 tonnes or
1.5%. Increases were registered in stock food (+41,000)
and aluminium (+28,000) however other bulk cargoes were
negatively impacted with logs (-29,000) in comparison to the
prior half year.
Interim Report

Disruption in the container supply chain is a worldwide
phenomenon which has reached all corners of the globe,
including South Port, impacting both volumes of cargo
and the number of ships calling at the Port. Containerised
cargo decreased 23% to 20,800 TEU (FY2021 27,000 TEU).
The main decreases were reflected in forestry and fertiliser
products. Container vessels transiting the Port were
similarly down 32% on the same period last year, at 17 calls
(FY2021 25 calls).
COVID-19
COVID-19 has been a constant threat to our business and
way of life since early 2020. As the virus mutates and
impacts society, South Port’s operation continues to adapt
to protect both our people and our business. The highly
infectious Omicron variant is now the most significant
challenge we face going forward.
Vaccination and testing are the two key tools South Port is
using to combat this ongoing threat.
Rapid antigen test kits have been sourced and are being
used to help ensure our staff coming to work are free of
COVID-19 and not a risk to fellow colleagues.
South Port has also mandated a compulsory Vaccination
Policy for all staff, contractors and visitors coming onto
the Port. We appreciate our staff’s cooperation and
understanding during this time.
This Policy works alongside our other infection prevention
and control measures to reduce the risk of exposure of
COVID-19, to keep our people safe, protect essential services
providing business continuity in the supply chain and to
maintain trust and confidence in South Port by ensuring we
continue to operate.
Operational Events
WAREHOUSING
Our warehousing operations continue to operate well,
handling similar if not increased volumes of cargo through
these facilities. This is pleasing and reinforces that the
cargoes being handled through our warehouse operations
are continuing to meet our strategic purpose during these
difficult times.
MAINTENANCE
The installation of the Impressed Current Cathodic Protection
(ICCP) system on the Port’s Access Bridge continues to
make good progress. Three bays (of 14) are left to complete
this significant maintenance upgrade of this crucial supply
chain artery to the Port. Once completed, this is expected to
extend the life of the Access Bridge by 25-30 years.
TUG PURCHASE
In September the Port welcomed the arrival of the Rakiwai,
a new 65 tonne bollard pull Azimuth Tractor Drive (ATD) tug.
The tug was built in Damen Song Shipyards in Vietnam at the
cost of $10M. This purchase has increased the total bollard
pull at South Port for a two tug operation to 105 tonnes. The
Rakiwai is expected to be in operation in March 2022.
TOWN WHARF UPGRADE
Excellent progress is being made on the upgrade to the
Town Wharf which services the petroleum import activity
for Southland and the Wakatipu Basin. The new accessway,
pipeline corridor and discharge platform are expected to be
completed and in operation by the start of the new financial
year.
Strategic Projects
KIA WHAKAŪ PROJECT
The Kia Whakaū project represents a number of initiatives
designed to improve the infrastructure, services and therefore
the capability of the Port to meet the needs of our existing
and future stakeholders.
A significant part of this project is the capital dredging of
the entrance channel, swinging basin and berth pockets.
South Port has applied for a resource consent to dredge
and remove seabed materials up to 160,000 m
3
of both soft
sediment and rock.
The successful completion of this project will provide
additional capacity to load more cargo on vessels calling at
the Port, reduce waste, increase efficiencies and provide a
safer transit through the entrance channel.

R T CHAPMAN
Chairman
N G GEAR
Chief Executive
NEW ZEALAND ALUMINIUM SMELTER (NZAS)
It was a welcomed relief for the region that Rio Tinto
announced a new Electricity Agreement on 4 January 2021
with Meridian Energy, allowing the New Zealand Aluminium
Smelter (NZAS) to continue operating until
31 December 2024.
Meridian Energy and Contact Energy are now investigating
the establishment of large scale green hydrogen production
opportunities in the region to make use of the electricity
resources from 1 January 2025, should the Smelter close.
South Port, while supporting the work being carried out by
the electricity companies, believes that there is the capacity
to support both NZAS and the establishment of a green
hydrogen plant in the region post 2024.
This strategy would also encourage the construction of
additional generation in the south to support both an
increase in green hydrogen production and other potential
offtakes.
Community
South Port continues to invest time and resources to
strengthen our relationship with the community. This is
evidenced through staff becoming involved with community
projects, sponsorships, and increased interaction with the
Awarua Rūnanga and the Bluff Community Board.
Improved communication has been an important part of
this process with the establishment of a Communications
Advisor role, use of our Facebook page and the recent
publications of our community newsletter.
Outlook
The COVID-19 pandemic continues to create uncertainty in
the marketplace and to provide challenges to our business
operations. In the coming months we expect to see Omicron
become widespread in the community and potentially in the
workplace. Processes have been put in place to mitigate this
threat however we expect this to be a challenging time for
both the business and the community.
Bulk cargoes are holding up well and it is expected that the
log markets will start to improve in the second quarter of
2022, post Chinese New Year.
Containers however will continue to be impacted by the
disruption in the supply chain, which is not expected to
improve until 2023 at the earliest.
Based on all known factors at the date of releasing its 2022
interim result, South Port estimates that its full year earnings
should fall in the range of $9.7 million to $10.0 million
(FY2021 - $10.71 million).
Dividend
Last year’s record profit of $10.71 million resulted in an
increased full year dividend of 27 cents per share. In the
event that the Company’s FY2022 year-end profit falls within
the forecast range, then it is expected that the full year
dividend payment will be maintained at 27 cents per share.

Financial Statements
Statement of Comprehensive Income
SIX MONTH PERIOD ENDED
31 DECEMBER 2021
Total operating revenues
from port services 23,342 23,384 47,291
Total operating expenses (12,802) (12,849) (28,447)
Gross profit 10,540 10,535 18,844

Administrative expenses (2,337) (2,045) (4,174)
Operating profit before
financing costs 8,203 8,490 14,670

Financial income 609 111 340
Financial expenses (468) (183) (367)
Net financing costs 141 (72) (27)
Other income 10 29 36
Surplus before income tax 8,354 8,447 14,679
Income tax (2,490) (2,382) (3,965)
Adjustments relating to tax
legislation changes – – –
Net surplus after income tax 5,864 6,065 10,714
Other comprehensive income – – –
Total comprehensive
surplus/(loss) after income tax 5,864 6,065 10,714
Basic earnings per share $0.224 $0.231 $0.408
Statement of Cash Flows
SIX MONTH PERIOD ENDED
31 DECEMBER 2021
Cash flows from operating
(note 6) 5,002 5,622 15,827
Cash flows from investing (15,625) (4,464) (11,057)
Cash flows from financing 10,858 (379) (4,372)
235 779 (398)

31/12
2020
$000’s
31/12
2021
$000’s
Year to
30/06/21
$000’s
31/12
2020
$000’s
31/12
2021
$000’s
Year to
30/06/21
$000’s
UnauditedUnauditedAudited
UnauditedUnauditedAudited
Statement of Financial Position
SIX MONTH PERIOD ENDED
31 DECEMBER 2021
TOTAL EQUITY 50,276 46,847 49,528
Non-Current Assets
Property, plant & equipment 72,399 53,612 57,218
Right-of-use assets 289 346 317
Deferred tax asset 397 235 466
Financial assets 190 – –
Total non-current assets 73,275 54,193 58,001
Current Assets
Cash and cash equivalents 1,862 2,008 1,627
Trade and other receivables 6,534 8,559 9,045

Total current assets 8,396 10,567 10,672
Total assets 81,671 64,760 68,673
Non-Current Liabilities
Employee entitlements 38 31 32
Loans and borrowings 25,000 11,000 9,000
Financial liabilities – 639 234
Lease liabilities 252 307 280
Total non-current liabilities 25,290 11,977 9,546
Current Liabilities
Trade and other payables 3,692 3,732 6,553
Employee entitlements 1,461 1,347 1,418
Provision for taxation 897 805 1,393
Financial liabilities – – 182
Lease liabilities 55 52 53

Total current liabilities 6,105 5,936 9,599

Total liabilities 31,395 17,913 19,145
TOTAL NET ASSETS 50,276 46,847 49,528

Net asset backing per share $1.92 $1.79 $1.89
31/12
2020
$000’s
31/12
2021
$000’s
Year to
30/06/21
$000’s
UnauditedUnauditedAudited
NET INCREASE/(DECREASE)
IN CASH

Net cash provided by operating
activities
Notes to the Financial Statements
FOR THE SIX MONTH PERIOD ENDED 31 DECEMBER 2021
Total equity at beginning
of the period 49,528 45,635 45,635
Profit/(loss) after income tax 5,864 6,065 10,714
Other comprehensive income – – –
Total comprehensive surplus 5,864 6,065 10,714
Distributions to shareholders (5,116) (4,853) (6,821)
Total equity at end of the period 50,276 46,847 49,528
31/12
2020
$000’s
31/12
2021
$000’s
Year to
30/06/21
$000’s
UnauditedUnauditedAudited
5 Statement of Changes In Equity
SIX MONTH PERIOD ENDED
31 DECEMBER 2021
Surplus after taxation 5,864 6,065 10,714
Add/(less) items classified
as investing/financing activities – – –
Add/(less) non-cash items 1,515 1,883 3,474
Add/(less) movement in working
capital (2,377) (2,326) 1,639

5,002 5,622 15,827

6 Net Cash Flow from Operating Activities
1 Activities of South Port Group
The Group is primarily involved in providing and
managing port and warehousing services.
2 Accounting Policies
The Group is a Financial Markets Conduct (FMC)
reporting entity for the purposes of the Financial
Reporting Act 2013 and the Financial Markets Conduct
Act 2013. These financial statements comply with these
Acts and have been prepared in accordance with the
New Zealand equivalents to International Financial
Reporting Standards (NZ IFRS) and other applicable
Financial Reporting Standards, as appropriate for profit-
orientated entities. These financial statements comply
with International Financial Reporting Standards (IFRS).
There has been no change in accounting policies. All
policies have been applied on a consistent basis with the
most recent annual report.
3 Taxation
Income tax expense comprises current and deferred tax
at the company tax rate of 28%. Income tax expense is
recognised in the Statement of Comprehensive Income
except to the extent that it relates to items recognised
directly in equity, in which case it is recognised in equity.
4 Segmental Reporting
The South Port Group operates in the Port Industry in
Southland, New Zealand, and therefore only has one
reportable segment and one geographical area based
on the information as reported to the chief operating
decision maker on a regular basis. South Port engaged
with one major customer who contributed individually
greater than 10% of its total revenue for the period ended
31 December 2021. This customer contributed
$4.41 million for the six months ended 31 December 2021
(2020: $5.68 million).

Parent Company
South Port New Zealand
Limited
Subsidiary
Awarua Holdings Limited
Group Companies
Nigel Gear
Chief Executive
Geoff Finnerty
Port General Manager
Jamie May
Business Development Manager
Hayden Mikkelsen
Container Manager
Frank O’Boyle
Infrastructure Manager
Lara Stevens
Finance Manager
Murray Wood
Warehousing Manager
Helen Young
Human Resources Manager
Corporate Executives
Rex Chapman
Chairman
Philip Cory-Wright
Nicola Greer
Michelle Henderson
Clare Kearney
Jeremy McClean
Directors

Island Harbour, PO Box 1,
Bluff 9842, New Zealand
 +64 3 212 8159  reception@southport.co.nz
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