A tale of two companies

This past week we have seen two companies in a similar industry show stark contrasts in the way they perform, operate and are owned.

The first company is owned by the public, it is riven by dissent amongst it’s highly unionised workforce, losing business, costing jobs and shrinking in size with major customers shifting their loyalty.

The other company is publicly listed, in the mixed ownership model with the majority shareholder the local authority. It has a workforce at harmony and just announced increased profitsto record highs.

Profit rose 22 per cent to $34.6 million for the six months ended December 31, the company said in a statement. That beat brokerage First NZ Capital’s forecast of $33.8 million and Forsyth Barr’s of $32.9 million. Sales increased 14 per cent to $105.7 million.

Total trade volumes across the port gained 9.6 per cent to 8.5 million tonnes in the first half, while container numbers increased 17 per cent to 344,081.

The shares have soared 58 per cent in the past two years as the port company cemented its place as the major departure point for bulk commodities including logs and dairy products and won an increasing share of the container trade by setting up an inland hub in south Auckland.

One is 100% public owned and the other is using the mixed ownership model. The differences couldn;t be more stark.

But we can add another Mixed Ownership Model tot he mix…as proff, if you will. Auckland International Airport which Brian Gaynor describes as:

Auckland International Airport has been the second best performing large cap company over the past decade as it achieved a value lift from $1.52 billion to $3.23 billion. As with all the other companies this performance does not include dividends and capital returns to shareholders.

The airport operates under a relatively light regulatory regime and the number of overseas arrivals through the port has increased from 1,348,200 a decade ago to 1,847,200 last year.

The company’s share of total New Zealand airport arrivals from overseas has increased from 70.6 per cent to 71.2 per cent over the past decade. This clearly makes it one of the country’s most important infrastructure assets.

The new Auckland Council should compare their two major infrastructure investments, the airport vs the port and start to wonder if Mike Lee’s public ownership model for the port is really performing as he promised.

You do have to wonder about Labour wanting to die in a ditch over mixed ownership, but then socialist have never really been blessed with an abundance of commonsense.

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  • Watch out Cam, Cllr I mean Chairman Lee of the Democratic Workers Party of Auckland and Chair of the Stalinist Planning Committee will come chasing after you. Mention Port of Auckland, Waterfront Auckland as Hootoon did or Auckland Transport as I did and the stooges come chasing after you.

    On a serious note, there is now no doubt that POAL should become mix model, I hope candidates next year development a stomach and openly campaign on this next year

    • Hakim of phut

      Mike Lee isnt Chairman of any Planning committee. He is just one of two appointments  made by Len Brown to Auckland Transport board , Christine Fletcher is the other

      • Well arent you a dull spark. I take dramatic irony and sarcasism escapes you?
        Chairman Lee might not be actual head of the planning committee, just the power behind the throne of the committee. After Lee’s wobbly last week one can gather that very quickly

  • thor42

    So, HoP – given that PoA is closer to the Labour Party’s idea of utopia than PoT is – why is PoA doing so poorly? 

    Shock, horror – could the Labour Party have got it **wrong?**

  • parorchestia

    The rot spreads beyond ports – unionism and state favouritism have greatly damaged coastal shipping – the cheapest and most efficient way of shipping goods.