South Port NZ Ltd – Interim Report to 31 December 2022

REFLECTING
ON TIMES PAST
looking
to the future
Interim Report For the six month period ended 31 December 2022

Financial Performance
The South Port 2023 first half has been characterised by excellent
progress being made on some longer-term initiatives for the Port,
but with subdued operational performance reflecting constraints
in China and a slowing domestic economy.
South Port has recorded a steady start to the financial year. Total
bulk cargo volumes were consistent with the previous financial
period, although slightly behind expectations. However, container
volumes continued to be negatively impacted, showing a decline
over the same period.
South Port’s NPAT for the first six months of FY2023 was $5.2
million (FY2022 $5.9 million). Several factors impacted on this
interim result, including:
öThere were increased stock food volumes imported into
the region to service the dairy industry, and the exports of
woodchips remain strong.
öThe log market has maintained its downward cycle due to the
currently depressed property market in China.
öFertiliser volumes were down and are expected to remain
similarly impacted for the remainder of the financial year due
to lower sheep and beef prices.
öIncreased financing costs due to higher interest rates and
additional debt on the balance sheet.
öInternational container supply chains continue to be
significantly disrupted.
The reported FY2023 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 1,732,000 tonnes compared with
1,745,000 tonnes in the prior year’s interim period. This represents
a decrease in cargo flows of 13,000 tonnes or 0.7%. There
were increases in stock food (+28,000), alumina (+24,000),
and woodchips (+35,000), however other bulk cargoes were
negatively impacted with logs (-16,000), fuel (-20,000) and fertiliser
(-44,000) all down in comparison to the prior half year.
Disruption in the container supply chain will continue until there is
a return to normal shipping windows, especially at the larger ports
in New Zealand. Containerised cargo decreased 13% to 18,000
TEU (FY2022 20,800 TEU). The main decreases were imported
products for the manufacturing and farming sectors. Container
vessels transiting the Port were the same as last year at 17 calls.
Operational Events
Warehousing
It has been another busy period for our warehousing division.
Initially, there was a significant buildup of product in stores
placing strain on our available space; however, several export
orders received towards the end of CY2022 have relieved some of
this pressure.
Marine Plant
The new tug MV Rakiwai has been in operation for 12 months
and is proving to be a great asset for the safe handling of vessels
visiting the Port. During this period, there was a significant
amount of resource put into training our pilots and tugmasters
to become familiar with the handling and controls of an Azimuth
Tractor Drive compared to a Voith tug.
One of our other two tugs, the MV Te Matua was dry docked in
the fourth quarter of CY2022 for a 5-year survey. The docking
involved a significant amount of maintenance activity which was
successfully completed, and the MV Te Matua is now back in
service.
The
evolution
of Bluff
Harbour
196219501955
Interim Report
2

Infrastructure
Access Bridge
The installation of the Impressed Current Cathodic Protection
(ICCP) system on the Access Bridge will be completed this financial
year. Bay 14 is the last section of the bridge left to complete, in what
has been a very successful maintenance project for the Port in
extending the life of a vital piece of infrastructure.
Town Wharf Upgrade
The new accessway, pipeline corridor, and discharge platform have
been completed and are fully operational. The new development
was officially opened on 22 November 2022 with a celebration and
an official blessing by Te Rūnaka o Awarua Kaiwhakahaere Dean
Whaanga.
Strategic Projects
Kia Whakaū Project
The Kia Whakaū project represents several initiatives designed
to improve the infrastructure, services, and, therefore, the Port’s
capability to meet the needs of our existing and future stakeholders.
The major part of this project is to dredge and remove seabed
materials to 9.7m chart datum (CD) in the harbour entrance
channel, 10.7m CD in the Island Harbour berth basins, and 9.45m
CD in the swinging basin. It is pleasing to report that on 31 August
2022, South Port was granted resource consent by Environment
Southland for project Kia Whakaū.
The Port is currently working through contractual requirements;
however, we expect this work will begin in the second quarter of
CY2023.
The successful completion of this project will provide additional
capacity to load more cargo on vessels calling at the Port, increase
efficiencies, and provide a safer transit through the entrance
channel. The completion of the project will also enable the Port to
service future growth opportunities.
Dredging Project – Existing Coastal Permit
On 8 August 2022, the Company informed the market that we
had contracted Heron Construction to remove the fractured or
fragmented rock that remained in the Port harbour entrance
channel from previous dredging campaigns, operating under an
existing coastal permit.
In a media release on 7 October 2022 and at the Annual
Shareholders’ Meeting on 1 November 2022, the Company
notified the market that this had been a very successful campaign,
nearly achieving our objective in project Kia Whakaū, to reach
9.7m CD in the harbour entrance channel. Owing to the success
of this project, the drilling and blasting activity that was required
in the channel for project Kia Whakaū is unlikely to be required
under the consent granted on 31 August 2022.
Green Hydrogen
Meridian Energy announced on 29 November 2022 that
Woodside Energy had been selected as their preferred partner to
move forward to the development stage of the proposed Southern
Green Hydrogen project in Southland. South Port is assisting
these two parties with port and shipping related enquiries as they
work towards making a final investment decision.
New Zealand Aluminium Smelter
New Zealand Aluminium Smelter (NZAS) is currently in
discussions with the electricity generators to establish a potential
supply contract that will allow the smelter to continue operating
after December 31, 2024. This is a pleasing development for both
the Port and the Southland region.
Although the Southern Green Hydrogen project has created
competition for electricity supply, South Port believes there is
the capacity to support both NZAS and the establishment of a
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 hydrogen production and other
potential offtakes.
1973196519711964
3

R T CHAPMAN
Chairman
N G GEAR
Chief Executive
Outlook
There are several global events that continue to create uncertainty
and provide challenges to our business operations.
The war in Ukraine, the rate of economic recovery in China, and
the threat of a global recession are impacting marketplaces which
have a flow-on impact on commodity prices and volumes handled
through the Port.
The container supply chain is still disrupted, and although
expectations are that this will improve, the timing of this
realignment is still not clear.
Bulk cargoes held up well for the first six months of FY2023
however, logs, fertiliser and fuel volumes are not expected to
improve in the second-half of FY2023, due to the aforementioned
factors.
Based on all known factors at the date of releasing its 2023
interim result, South Port estimates that its full year earnings
should fall in the range of $11.1 million to $11.6 million (FY2022
$12.8 million).
Dividend
After assessing the anticipated year end result, the Directors have
declared a fully imputed interim dividend of 7.50 cents per share
(2022 7.50 cents) payable on 7 March 2023. In the event that the
Company’s FY2023 year-end profit falls within the above forecast
range, then the full-year dividend payment will be at least the
same as the previous year.
Kaiwera Downs Wind Farm
It is pleasing to see that the construction of the first stage of
Mercury Energy’s 240MW Kaiwera Downs wind farm, 15km east of
Gore has commenced. This first stage involves the installation of
ten 4.3MW turbines and is expected to be operational by the end
of CY2023. South Port is progressing discussions with the lead
importer about the potential to handle this cargo through the Port.
Climate-Related Disclosures
The External Reporting Board recently achieved an important
milestone in New Zealand’s transition to a low-emissions
economy, with the publication of the Aotearoa New Zealand
Climate Standards.
South Port is a climate reporting entity under the Financial
Markets Conduct Act 2013, and therefore is required to comply
with these standards. The first year of mandatory climate-related
disclosures for the Company is FY2024, and we are underway with
this project to ensure we meet our obligations.
We have recently formed a Sustainability Committee and have
engaged an external party to assist us on our sustainability
journey.
Community
Town Wharf Access
The Company has received several requests from the community
in recent years asking for access to the town wharf for pedestrians
and fishermen. The Company was finally able to grant this
request prior to Christmas, with a portion of the town wharf being
sectioned off and made available to the public.
Port Open Day
While there have been some false starts to the Port open day
in recent years due to Covid-19, we are happy to report that our
second open day in recent times is scheduled to be held this year.
1983202219901974

Financial Statements
Statement of Comprehensive Income
SIX MONTH PERIOD ENDED
31 DECEMBER 2022
Total operating revenues
from Port services 24,939 23,342 48,584
Total operating expenses (16,435) (14,382) (27,160)
Operating profit before
administrative and 8,504 8,960 21,424
finance costs
Administrative expenses (986) (757) (4,642)
Operating profit before
financing costs 7,518 8,203 16,782

Financial income 368 609 1,374
Financial expenses (760) (468) (1,008)
Net financing costs (392) 141 366
Other income 95 10 10
Surplus before income tax 7,221 8,354 17,158
Income tax (2,068) (2,490) (4,329)
Net surplus after income tax 5,153 5,864 12,829
Other comprehensive income – – –
Total comprehensive
surplus/(loss) after income tax 5,153 5,864 12,829
Basic earnings per share $0.196 $0.224 $0.489
Statement of Cash Flows
SIX MONTH PERIOD ENDED
31 DECEMBER 2022
Cash flows from operating
(note 6) 5,434 5,002 13,695
Cash flows from investing (9,508) (15,625) (23,337)
Cash flows from financing 4,838 10,858 9,318

764 235 (324)
31/12
2021
$000’s
31/12
2022
$000’s
Year to
30/06/22
$000’s
31/12
2021
$000’s
31/12
2022
$000’s
Year to
30/06/22
$000’s
UnauditedUnauditedAudited
UnauditedUnauditedAudited
Statement of Financial Position
AS AT 31 DECEMBER 2022
TOTAL EQUITY 55,311 50,276 55,274
Non-Current Assets
Property, plant & equipment 84,184 72,399 77,342
Right-of-use assets 379 289 427
Deferred tax asset 1,189 397 1,107
Financial assets 870 190 789
Total non-current assets 86,622 73,275 79,665
Current Assets
Cash and cash equivalents 2,067 1,862 1,303
Trade and other receivables 8,868 6,534 7,004
Financial assets 441 – 164

Total current assets 11,376 8,396 8,471
Total assets 97,998 81,671 8 8 ,1 3 6
Non-Current Liabilities
Employee entitlements 56 38 50
Loans and borrowings 35,500 25,000 25,500
Lease liabilities 320 252 360
Total non-current liabilities 35,876 25,290 25,910
Current Liabilities
Loans and borrowings – – –
Trade and other payables 4,358 3,692 3,325
Employee entitlements 1,874 1,461 1,548
Provision for taxation 492 897 1,986
Lease liabilities 87 55 93

Total current liabilities 6,811 6,105 6,952

Total liabilities 42,687 31,395 32,862
TOTAL NET ASSETS 55,311 50,276 55,274

Net asset backing per share $2.11 $1.92 $2.11
31/12
2021
$000’s
31/12
2022
$000’s
Year to
30/06/22
$000’s
UnauditedUnauditedAudited
NET INCREASE/(DECREASE)
IN CASH
5

Net cash provided by operating
activities
Notes to the Financial Statements
FOR THE SIX MONTH PERIOD ENDED 31 DECEMBER 2022
Total equity at beginning
of the period
55,274 49,528 49,528
Profit/(loss) after income tax 5,153 5,864 12,829
Other comprehensive income – – –
Total comprehensive surplus 5,153 5,864 12,829
Distributions to shareholders (5,116) (5,116) (7,083)
Total equity at end of the period 55,311 50,276 55,274
31/12
2021
$000’s
Year to
30/06/22
$000’s
31/12
2022
$000’s
Unaudited
05 Statement of Changes In Equity
SIX MONTH PERIOD ENDED
31 DECEMBER 2022
Unaudited
Surplus after taxation 5,153 5,864 12,829
Add/(less) items classified
as investing/financing activities – – –
Add/(less) non-cash items 1,839 1,515 2,357
Add/(less) movement in working
capital (1,558) (2,377) (1,491)

5,434 5,002 13,695

06 Net Cash Flow from Operating Activities
01 Activities of South Port Group
The Group is primarily involved in providing and managing
port and warehousing services.
02 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)
as appropriate for condensed interim financial statements.
They comply with New Zealand equivalents to International
Accounting Standards 34 (NZ IAS 34) Interim Financial
Reporting, and International Accounting Standards 34. There
has been no change in accounting policies. All policies have
been applied on a consistent basis with the most recent
annual report.
03 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.
Audited
04 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 2022. This
customer contributed $4.14 million for the six months ended
31 December 2022 (2021: $4.41 million).
6

Parent Company
South Port New Zealand Limited
Subsidiary
Awarua Holdings Limited
Group
Companies
The original Bluff Harbour
Board building, circa 1910.
Directors
Rex Chapman
Chair
Philip Cory-Wright
Nicola Greer
Michelle Henderson
Clare Kearney
John Schol
Corporate
Executives
Nigel Gear
Chief Executive
Geoff Finnerty
Port General Manager
Jamie May
Commercial Manager
Hayden Mikkelsen
Container Manager
Frank O’Boyle
Infrastructure and
Environmental Manager
Lara Stevens
Chief Financial Officer
Murray Wood
Warehousing Manager
Helen Young
People and Safety Manager
7

Island Harbour, PO Box 1, Bluff 9842, New Zealand
 +64 3 212 8159
 reception@southport.co.nz
  South Port NZ
southport.co.nz
Printed on 100% recycled paper