Council ventures' earnings down

Keith Cooper. Photo: Peter McIntosh
Keith Cooper. Photo: Peter McIntosh
The Dunedin City Council's companies remain stable despite a dip in half-year earnings across the group, new figures show.

The companies this week released their interim results for the six months to December 2018, which showed the group's after-tax profit had dropped to $1.82 million, down from $4.31 million for the same period in 2017.

Dunedin City Holdings Ltd chairman Keith Cooper said he was pleased the companies had delivered another ''positive'' financial result, driven by a continued strong performance by City Forests.

The forestry company had booked a $5.2 million after-tax profit, although that was down from $6.87 million in the same period in 2017.

The other council-owned companies had also recorded a mixture of reduced six-month after-tax profits and losses, led by Aurora.

The lines company, which was continuing to reinvest in an upgrade of its ageing network, saw its six-month after-tax profit drop from $3.15 million in 2017 to $1.43 million in 2018.

Infrastructure company Delta's profit was down from $1.66 million to $621,000 and Dunedin Venues - which runs Forsyth Barr Stadium - booked a tiny $11,000 after-tax profit, down from $298,000 the previous year.

Dunedin Stadium Property Ltd, which owns the venue, booked a largely non-cash after-tax loss of $3.94 million, as expected.

Dunedin Railways Ltd booked a smaller loss, at $444,000, than the previous year, when it lost $634,000, while Dunedin International Airport Ltd's after-tax profit also reduced, from $2.16 million in 2017 to $1.94 million in 2018.

Mr Cooper, in a statement, said the results were in line with budget projections, and the group's strong operating cash flow would continue to provide stability to the group.

The exception was Delta, which had been hit by ''seasonal conditions'' which increased costs, together with the timing of contracts, he said.

That was expected to correct itself in the second half of the 2018-19 financial year, Mr Cooper said.

Aurora's operating revenues were down and network operating expenses up, but the company's continued focus on renewing its network had resulted in capital expenditure of $32 million during the period.

Dunedin City Treasury Ltd, which sources debt for the group, had managed to reduce average borrowing costs from 4.70% to 4.03% over the period, saving about $2.1 million across the group.

Dunedin Venues' reduced profit reflected the timing of one-off events held in the previous year, including a Bledisloe Cup rugby test.


Profit down by over $1.8m! How can this be so? Mr Cull keeps telling us how the city is booming and how now is the time to spend, spend, spend to keep the momentum going! We are also being told what a huge success the stadium has been, yet the figures don't look good. How much of the profit is being payed back to the council and it's ratepayers? One good forest fire and all the profits would have gone up in a puff of smoke!

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