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Te pūrongo o Te Rau Matomato
CEO Report - Aisha Ross
Takina mai ko te kawa!
Ko te kawa nā wai?
Ko te kawa nā Tītokowaru
Ko te kawa hau tapu o Parau kau o Tū kau
Ka iri te kawa kei runga! Ka iri te kawa kia rautāpatu te kawa ora
Tūturu o whiti whakamoua kia tina
Tina! Haumi e, Hui e, Tāiki e!
It is a privilege to present the Parininihi ki Waitōtara Incorporation Te Rau Aroha Annual Report for the year ending 30 June 2023 for the first time as Te Rau Matomato/CEO.
Change is a constant, and our organisation has experienced this, both internally and externally, over the last year. But while it can present challenges, change ultimately provides us with the opportunity to learn and grow from differing perspectives and influences. It allows space to review and refresh our approach to the challenges ahead and tests and builds the belief and confidence we hold in our values and foundations.
As we go through this time of leadership transition, I acknowledge Warwick Tauwhare-George for his contribution to our kaupapa, and mahi in supporting an amazing management team. This group of seasoned professionals with a passion and belief in our kaupapa are key to the ongoing success of the organisation. Their commitment to you, our shareholders, is steadfast.
I would also like to mihi and acknowledge our whanaunga Will Edwards for his commitment to the kaupapa, the time spent around the Board table, contributing to the governance decision-making that provides the organisation with guidance and direction.
We welcomed Jayde Rangi-Wilkinson to Te Rau Rengarenga / Committee of Management, and I am looking forward to working with him and the rest of the Board into the future.
Much has already been said about the current economic climate, with high interest rates, rising costs, fickle global markets and a significant downward shift in property valuations presenting real challenges throughout all our business interests.
In response, we must focus on the strength of our business and the resilience it provides as we control what we can, parry what we cannot, and we continue to build and grow as we work towards our vision of He Tāngata, He Whenua, He Oranga.
FINANCIAL REPORT
For the financial year 2022/2023 the PKW group has resulted in a net loss after tax of $1m (21/22: $6.1m profit), with a total comprehensive income of -$2.2m (21/22: $1.2m). These figures clearly demonstrate the swings in the valuation of our whenua and the impact this has on our performance each year.
The direct impact on our financial performance was a total revaluation loss of $10.5, (21/22: $15.7m). This continued softening of the property market can be seen as a recalibration after the boom in 20/21 which saw our values rocket by $32.3m overall.
Despite the swings in dollar value, the value of our whenua as our core asset and the leverage it gives us to continue to build the business into a strong and sustainable organisation remains unchanged.
The milk pay out was consistent with last year at a blended price of $8.59kgMS (21/22: $8.60kgMS). This price is reached by mitigating fluctuating milk prices by hedging a portion of our output. The blended rate was reached though a hedging price of $8.84kgMS and Fonterra’s payout of $8.22kgMS.
Group expenditure was in line with forecast at $26m (21/22: $22m), further evidence of the high interest rates and fast rising inflation we experienced over the 12-month period. Another contributing factor was the first full year of operational expense from Miraka Hipi LP, which is still very much in its start-up phase.
Finance costs were $2.3m, an increase on last year (21/22: $1.9m) due to rising interest rates.
In terms of our performance as a business, a solid result was achieved with an operating profit after tax of $6m (21/22: $11.7m), supported by $34.4m in revenue (21/22: $37.1m).
INVESTMENTS
The impacts to some of our key investments were not just economic, with the environmental devastation caused by Cyclone Gabrielle hitting the East Coast impacting Rockit Apples particularly hard, and also affecting the catch rates recorded by Port Nicholson Fisheries (PNF).
However, PNF is still doing well with market demand in China for kōura remaining strong, and the project for the new processing plant in its final planning stages before construction begins later in 2023.
As previously mentioned, our Miraka Hipi venture has completed its first full year, with the first milk pick-up occurring in July 2022. While we are already experiencing the benefits in the taiao, and in the number of jobs the venture has created, the commercial returns will take time to become apparent as we follow the strategic plan for the increased scale of the operation.
Tai Hekenga continues to deliver the consistent returns we expect from this sustainable and consistent part of our investment portfolio – a clear example of the benefits of diversification and value-aligned decision-making.
The next rent review cycle is due to begin very soon and will be included in next year’s report. We continue to take a proactive approach to this process to ensure we achieve the best possible outcome. Therefore, a collegial approach with the West Coast Settlement Reserves Lessee Association is necessary to deal with any challenges as they arise.
PEOPLE
As an organisation, we have an on-going commitment to the hauora of our kaimahi across the entire business, with a distinct focus on health and safety of our PKW Farms and Taiao whānau, given the high-risk environment they work in.
Our people are a vital element in the success of our business, and like taonga, should be protected. The consideration we give to health and safety must be consistent and we must be robust in enforcing the protection measures required to keep kaimahi safe, both physically and mentally. This is particularly true in the demanding and challenging economic environment we are working in, with the need for cost control and efficiencies to be met.
There has been a significant focus on the strengthening of our cultural ties and identity through Te Reo me ōna tikanga, and kaupapa over the past year. The second Taranaki Kurataiao conference was a great success being held at Muru Raupatu Marae, and the launch of the Piki Mai Rawea mobile App just two examples of the quality mahi taking place.
The ongoing commitment to implement and embed the PKW Kaitiakitanga Strategy, which was developed in close collaboration with our whānau, is a further reflection of this focus. The Taiao Team has deepened their expertise and knowledge about the health and mātauranga of our Taranaki environment, and the work plans in place to care for it are impressive.
ACKNOWLEDGEMENTS
Although I have only been a part of the kaimahi whānau for a few short months, the support I have received from my fellow management team, Dion Tuuta and the Committee of Management, and shareholders themselves has been humbling. I have a deep sense of gratitude and look forward to continuing to serve as your Te Rau Matomato/CEO into the future.
Ngā tini manaaki,
Aisha Ross - Te Rau Matomato
