28 Jul 2011

Tainui Group outlines expansion plans

7:26 am on 28 July 2011

The commercial arm of the Waikato-Tainui iwi may consider issuing bonds to fund further expansion of its asset base, possibly to include a regional freight hub.

Tainui Group Holdings and Waikato Tainui Fisheries made $23.1 million in the year to the end of March, down from $34.1 million a year earlier.

Tainui Group chief executive Mike Pohio says the reduced profit is due to the slower economy and major investments during the year.

The addition of the 263-bed Novotel Hotel at Auckland Airport and further investment in The Base retail complex led to the group's total assets growing from $530 million to $660 million during the year.

Mr Pohio says the developments are largely finished and will now generate fresh revenue to drive the next stage of the business.

Over the next 12 months Tainui Group will turn its attention to developing the 500ha Ruakura site where it proposes to establish an inland port adjacent to the east coast main trunk rail line and, around that, a freight hub.

Mr Pohio says its too early to say how much it would raise through a bond issuance, and there's still a lot of work to be done to see if best option available. Any bond issue would not happen in the coming financial year.

Tainui Group Holdings increased the dividend it paid its Waikato-Tainui shareholder by half a million dollars to $10.5 million in the 2011 financial year.