Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Community Legacy Outperforms International Market

15 August 2006

‘Community Legacy’ Outperforms International Market

The first full year of New Plymouth District Council’s Perpetual Investment Fund (PIF) has finished successfully, with it outperforming the international investment market.

In the 12 months to the end of June this year, the PIF earned $43.3 million – a 16.5 per cent net growth.

“This is an extraordinarily good result,” says John Armstrong, chairman of Taranaki Investment Management Ltd (TIML).

“It’s been a big year for us: Getting the systems in place and getting the investments made so that the fund is appropriately diversified.

“We aim to match or better the markets we invest in. We’re trying to out-perform the market all the time, and when you compare the result to the different indices that we follow – such as the NZX, the Australian ASX and United States’ S&P500 – we’ve out-performed them all.”

The fund was set up on 14 December 2004 following the sale of the council’s shareholding in Powerco. Its initial $259.4m value comprised 37.5 per cent of Sparcs (high yield securities) and 62.5 per cent in cash or short-term deposits.

At the end of June 2006, the PIF had diversified to 28 per cent in Sparcs, 16.8 per cent in Australian equities, 15.3 per cent in US equities, 10.1 per cent in New Zealand equities, 12.4 per cent in other equities, 9.6 per cent in cash or short-term deposits and 7.8 per cent in fixed interest. Its total value at the end of June was $286.2m (after meeting its release payment obligations).

Mr Armstrong says TIML is getting closer to completing the fund’s desired diversification.

“Our aim is to have 80 per cent of the fund in growth assets – such as equities and property. At the end of June, 55 per cent of the fund was in growth assets, and we’ll further diversify as those opportunities arise.”
More…

TIML takes a conservative approach to investments as it wants the PIF to be a long-term legacy for the community of New Plymouth District, says Mr Armstrong.

“In any investment fund you have good years and bad years, so it’s great to get the money in the bank and store up a bit of fat because there will be a bad year. It’s very pleasing to get the first year away and get some reserve going.

“The fund has grown to $286.2m which, accounting for inflation and release payments to the council, means that we are 4.8 per cent better off in real terms than 12 months ago.

“For the next three years we’ll pay out $21.5m per year to the council, and focus on sustaining and building the fund so that our great-grandkids can benefit from it.”

The cost of managing the fund has met the agreed price of a quarter of a percent of the fund’s value.

New Plymouth District Council has a AAA credit rating from Standard & Poor’s.

- TIML is governed by an independent board consisting of four directors. It is authorised to make all investment decisions relating to the fund, and it reports to the council’s Investment Subcommittee on a regular basis (at least quarterly).

ENDS.

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

I Sing The Highway Electric: Charge Net NZ To Connect New Zealand

BMW is turning Middle Earth electric after today announcing a substantial contribution to the charging network Charge Net NZ. This landmark partnership will enable Kiwis to drive their electric vehicles (EVs) right across New Zealand through the installation of a fast charging highway stretching from Kaitaia to Invercargill. More>>

ALSO:

Watch This Space: Mahia Rocket Lab Launch Site Officially Opened

Economic Development Minster Steven Joyce today opened New Zealand’s first orbital launch site, Rocket Lab Launch Complex 1, on the Mahia Peninsula on the North Island’s east coast. More>>

Earlier:

Marketing Rocks!
Ig Nobel Award Winners Assess The Personality Of Rocks

A Massey University marketing lecturer has received the 2016 Ig Nobel Prize for economics for a research project that asked university students to describe the “brand personalities” of three rocks. More>>

ALSO:

Nurofen Promotion: Reckitt Benckiser To Plead Guilty To Misleading Ads

Reckitt Benckiser (New Zealand) intends to plead guilty to charges of misleading consumers over the way it promoted a range of Nurofen products, the Commerce Commission says. More>>

ALSO:

Half A Billion Accounts, Including Xtra: Yahoo Confirms Huge Data Breach

The account information may have included names, email addresses, telephone numbers, dates of birth, hashed passwords (the vast majority with bcrypt) and, in some cases, encrypted or unencrypted security questions and answers. More>>

ALSO:

Rural Branches: Westpac To Close 19 Branches, ANZ Looks At 7

Westpac confirms it will close nineteen branches across the country; ANZ closes its Ngaruawahia branch and is consulting on plans to close six more branches; The bank workers union says many of its members are nervous about their futures and asking ... More>>

Interest Rates: RBNZ's Wheeler Keeps OCR At 2%

Reserve Bank governor Graeme Wheeler kept the official cash rate at 2 percent and said more easing will be needed to get inflation back within the target band. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news