Dunedin City Holdings Ltd: Half Year Result to 31 December 2
The Dunedin City Holdings Limited group has reported a surplus after tax profit of $3.8 million for the six months to December 2017.
Dunedin City Holdings Limited Chair Graham Crombie says the group is pleased to show a positive financial result once again. “Our half year result is in line with our budget projections and our continued strong operating cash flow will provide a stable basis for the coming months and years.”
He says City Forests Ltd recorded a pleasing six monthly profit before tax of $9.43m, which is ahead of budget and the previous year’s result. This is primarily driven by strong international and domestic markets, and continued favourable shipping costs.
Dunedin Airport recorded an operating surplus before tax of $2.99m (2016: $2.44m), with aeronautical income 40.86% above last year, due to an increase in both landing charges and passenger numbers. Non-aeronautical income was also up 5.49% on last year.
Dunedin City Treasury achieved a reduction on the cost of funds during this period, which it was able to pass on to the group. The AA/A-1+ ratings for both DCTL and the Dunedin City Council were reaffirmed by Standard and Poor's in December 2017.
Aurora Energy’s and Delta Utility Services Ltd’s new management and governance structures took effect from 1 July 2017. Aurora’s higher levels of network maintenance and investment in new network assets are reflected in their reported capital expenditure of $38.07m, $22.12m higher than the same period last year. This increased investment was also a contributor to the higher levels of Group debt reported in this interim result.
Delta recorded a net profit before tax of $1.88m for this period. Total revenues were lower than the same period last year, largely due to the new contracting arrangements between Delta and Aurora.
Dunedin Venues Management Ltd recorded an operating profit before tax of $410,000. This represents an increase on the same period last year, largely due to increased major events at Forsyth Barr Stadium, such as the All Blacks Bledisloe Cup Test and the Stevie Nicks/ Pretenders concert.
Dunedin Stadium Property Ltd experienced an operating loss, as expected. The loss was smaller than that recorded over the same period in 2016. The result was primarily caused by a reduction in interest costs.
In December last year, Taieri Gorge Railway Limited changed its name to Dunedin Railways Limited to better reflect the wider operations of the company. In July 2017, a rainfall event over two days caused extensive slips and washouts. Initial repairs have been completed at a net cost of $385,000 with a loss of income of approximately $175,000. This event has had an impact on the company’s half year results, which report a before tax loss of $881,000 (2016: loss of $653,000).
Mr Crombie says the outlook for the Dunedin City Holdings Ltd Group remains stable. “We do not anticipate significant changes in markets, or updates to the projections set out in the Statements of Intent. We look forward to reporting our full year results in another six months.”
Note: The Dunedin City Council owns Dunedin City Holdings Ltd, which in turn owns seven subsidiary companies being:
• Aurora Energy Ltd
• City Forests Ltd
• Delta Utility Services Ltd
• Dunedin City Treasury Ltd
• Dunedin Stadium Property Ltd
• Dunedin Venues Management Ltd
• Dunedin Railways Ltd (72% share)
and a 50% share in Dunedin International Airport Ltd.