Tax changes to affect POT profit

Media Release: Tax changes to affect Port of Tauranga profit
Port of Tauranga Limited (NXZ: POT) today announced that changes to tax
legislation will result in an $12.9 million impact to the Group Net Profit After
Tax for the year ending 30 June 2024.
Port of Tauranga Chief Executive, Leonard Sampson, said the law change for
depreciation on commercial buildings would result in the company
recognising a one-off deferred tax expense for the 2024 financial year. This
will reduce reported profit for the period.
“This one-off accounting adjustment will reduce our final reported profit but
has no impact on cash flows. We still expect to deliver a normalised 2024
operating profit
1
in line with our previous guidance of $95 million to $107
million,” he said.
The deferred tax position on commercial buildings has become complex due
to multiple changes in tax legislation. In 2010, the ability to claim depreciation
deductions was removed. In 2020 it was reinstated as part of the Covid-19
response, and then removed again in March 2024 by the new coalition
Government. This legislation change affects all commercial buildings with an
estimated useful life of 50 years or more, and the implications for Port of
Tauranga vary depending on when building expenditure occurred.
Since the latest legislation was passed at the end of March, Port of Tauranga
has undertaken the required recalculations and had them reviewed for
compliance by an external advisor.
Port of Tauranga’s annual results for the year ended 30 June 2024 will be
announced on Friday, 23 August 2024.
For further details, please contact:
Rochelle Lockley
GM Communications, Port of Tauranga Limited
Ph 021 865 884
1
Normalised operating profit is equal to reported net profit after tax, less the impact of the one-off deferred tax expense.
Media Release
4 JULY 2024