year in review annual report...the year in review 7 performance summary 8 our performance against...
TRANSCRIPT
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usinessYear in R
eview
Section title here | Gladstone Ports Corporation | Annual Report 2008–09 A
Annual Report
2008–09
i Communication Objective | Gladstone Ports Corporation | Annual Report 2008–09
Com
mun
icat
ion
Obj
ectiv
e
With this report, we aim to build awareness of our operations and confidence in GPC. It shows that as an organisation we are well managed and focused on maintaining our status as one of the nation’s most progressive, and cost effective and efficient ports. Furthermore we demonstrate our dedication to maintaining our community’s regard for us as a good corporate citizen, enhancing our reputation and raising our profile as an employer of choice.
We follow a policy of transparent operation and full disclosure – our report exceeds the legislative requirements of the Government Owned Corporations Act 1993 and the Financial Administration and Audit Act 1977.
In June 2009 our 2007–08 report received a Gold Award from the internationally recognised benchmarking forum, the Australasian Reporting Awards (ARA). The award recognised our report as a model for other peer reports; and comment was made on its overall excellence in reporting; high-quality coverage of most aspects of the ARA criteria; full disclosure of key aspects of our core business; and the manner in which current legislative and regulatory requirements were addressed. To assist us in improving our reporting standards we obtained feedback from the ARA, and have incorporated their suggestions, as well as those received from readers, into this year’s report.
This report details our corporate, environmental and social activities and performance against our targets for 2008–09 and demonstrates how we have held true to our vision by advancing our mission and living our values. It shows how our commitment to the vision of advancing the economic development of the Central Queensland region and the state is being achieved through our efforts to make the Port of Gladstone the world’s most reliable, cost-efficient coal exporting port and Australia’s premium resource processing port.
We invite your feedbackWe welcome your feedback as it assists us to ensure that we not only continue to improve our reporting standards, and meet your information needs. We encourage you to provide any comments or suggestions about the content or design of this annual report to our Community Relations department on:
+ 61 07 4976 1333 or via our website – www.gpcl.com.au (Feedback and Suggestions).
Contact details:This report (2008–09), past reports and various other GPC publications are available on our website – www.gpcl.com.au. Requests for hard copies of this report are welcomed via our Community Relations department – please call:
+ 61 7 4976 1333 or write to: Gladstone Ports Corporation Limited Community Relations PO Box 259 GLADSTONE QLD 4680
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usinessYear in R
eview
Rockhampton
BRuCEHIGHWAY
NORTH COASTRAILWAY LINE
EAST ENDRAILWAY LINE
ROCkHAmPTONPILOTAGE LImIT
PORT ALmA SHIPPING TERmINAL LImIT
GLADSTONEPILOTAGELImIT
CONNOR BLuFF
PORT OFGLADSTONELImIT
SHIP ARRIvAL LImIT4Nm RADIuS FROm FAIRWAY BuOY
PORT CuRTIS
mOuRA RAILWAY LINE
mONTO RAILWAY LINE
NORTH COASTRAILWAY LINE
DAWSONHIGHWAY
Gladstone
CAPE kEPPEL
CATTLE POINT
ARCH ROCk
GAS PIPELINE
08
01
02
03 04
05 0607
04
0203
05
06 07 08
0910
01
02
03
04
05
06
07
08
09
01
iiAbout us | Gladstone Ports Corporation | Annual Report 2008–09
Who we areGladstone Harbour Board commenced operation in 1914 and Rockhampton Harbour Board in 1896 – both became port authorities in 1987. Gladstone and Rockhampton (Port Alma) ports became Government Owned Corporation’s (GOC’s) in 1994 and 1995 respectively. On 1 July 2004 the authorities were merged and commenced operations as the Central Queensland Ports Authority (CQPA).
On 13 march 2008, CQPA was renamed the Gladstone Ports Corporation (GPC). On 1 July 2008, GPC converted to a Company Government Owned Corporation (GOC), constituted under the Government Owned Corporations Act 1993 (GOC Act), and we became Gladstone Ports Corporation Limited as part of this process. Port Alma also assumed a new trading name, Port Alma Shipping Terminal.
Abo
ut u
s We manage and operate the Port of Gladstone, including the Gladstone marina and its recreational parklands, and Port Alma Shipping Terminal.
What we doOur ports handle the export of resources from Central Queensland, the import of raw materials, and the export of finished products from local industries. The Port of Gladstone is Queensland’s largest multi-commodity port, housing the world’s fourth largest coal export terminal (by throughput).
iii About us | Gladstone Ports Corporation | Annual Report 2008–09
01 Fisherman’s Landing Wharves
02 RG Tanna Coal Terminal
03 Clinton Coal Wharf
04 Auckland Point Wharves
05 Barney Point Wharf
06 South Trees Wharf
07 Boyne Wharf
08 Port Alma Shipping Terminal
GPC InFRASTRuCTuRe
01 Stuart Oil Shale Project
02 Cement Australia
03 Gas Station
04 Rio Tinto Aluminium Yarwun Refinery
05 Orica
06 Gladstone Power Station
07 Queensland Alumina Refinery
08 Boyne Smelters Limited
09 State Development Area
MAjOR InDuSTRY
01 Peak Island
02 Mud Island
03 Casuarina Island
04 Balaclava Island
05 Curtis Island
06 Wiggins Island
07 Quoin Island
08 Facing Island
09 Wild Cattle Island
10 Hummock Hill Island
ISLAnDS
Where we areThe Port of Gladstone is located 525 kilometres (km) north of Brisbane. Port land and facilities are located at various sites within the port precinct. A total of 4,321 hectares (ha) of land falls under our control, encompassing more than 700ha of reclaimed land. Land uses include operational (16.98%), commercial (14.59%), recreational and reserve (4.92%) and future operational/commercial (63.51%). Port Alma Shipping Terminal is located 62km east of Rockhampton on the southern tip of the Fitzroy River delta with storage land totalling 140ha for the facility. Both ports are secure and sheltered.
more informationYou will find more about our business (pages 21–39), infrastructure (pages 41–47), approach to the environment (pages 49–59), our involvement with our regional community (pages 61–67), our people (pages 69–87), our governance and our financial position (pages 89–111) within this report and on our website – www.gpcl.com.au.
Our peopleWe employ 646 people to carry out our operational requirements. This includes all port administrative duties at the Port of Gladstone and Port Alma Shipping Terminal; all cargo unloading and shiploading operations at GPC owned and operated facilities at the Port of Gladstone; general maintenance; harbour works; quarry operations; and reclamation works.
We value the safety of all employees and visitors to our various work sites. We work to the National Safety Council of Australia’s (NSCA’s) 5-star safety rating system and strive for continuous improvement to our safety performance in all areas of operation.
Our customersWe maintain business partnerships with customers involved in the trade of both general and bulk cargoes. We value these relationships, recognising that our customers are paramount to the success of our business.
We engage proactively with our customers and encourage them to formally (through regular surveys) and informally (in our daily dealings) provide feedback that assists us to improve our service to them.
Our environmentWe provide a variety of port facilities and services in an estuarine environment of high conservation value. We have developed, and actively perform our work within, an Environmental management System (EmS) to maintain and, where possible, enhance the social and ecological values of the Port of Gladstone and Port Alma Shipping Terminal. Our EmS is certified to ISO 14001:2004.
Our communityOur desire to maintain our status as a good corporate citizen is at the forefront of our community relations initiatives. We play an active role within the Central Queensland community, administering an annual Community Support Program, maintaining an open door policy in relation to port operations, and providing regular detailed communications to our stakeholders.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usinessYear in R
eviewFinancials
Corporate
Governance
People
Com
munity
Environm
entInfrastructure
Business
Year in Review
vision, mission and values | Gladstone Ports Corporation | Annual Report 2008–09 11
Visi
on, M
issi
on a
nd V
alue
s Our visionTo ensure the Port of Gladstone and Port Alma Shipping Terminal operate effectively, efficiently and on a commercial basis for the continuing benefit of the Central Queensland community, port users and the State of Queensland.
Our missionTo achieve our vision, our focus is on managing, operating and developing effective and efficient port facilities and services within Central Queensland.
This requires the provision of appropriate infrastructure, and a values-driven approach to the sustainable planning, development and maintenance of both new and existing facilities and the operation and management of recreational and commercial port lands. Gladstone Ports Corporation Limited (GPC) plays an integral role in planning the future of the ports. In consultation with the community, industry and government, we undertake a strategic approach to planning, setting the vision and direction for the Port of Gladstone and Port Alma Shipping Terminal for both the long and short-term. Our one-year plan (Statement of Corporate Intent), five-year plan (Corporate Plan 2009–2014) and 50-year plan (Strategic Plan 2008–2058) provide the planning tools and strategic framework necessary for us to achieve our vision of effective, efficient and commercially viable port operations.
Our valuesWe will be:
• environmentallyresponsible–maintaining the environmental integrity of the Port of Gladstone and Port Alma Shipping Terminal in line with community and stakeholder expectations
• governancefocused–providingthe vision and direction to promote and develop business opportunities whilst ensuring compliance with legal and contractual obligations
• improvementfocused–retaining,increasing and diversifying trade through the Port of Gladstone and Port Alma Shipping Terminal, while carrying out port operations in accordance with world’s best practice
• commerciallysound–earningcommercial long-term rates of return on shareholders’ funds, generating funds to meet port infrastructure requirements, retaining current and developing future business opportunities and maintaining a sound financial position
• supportiveofouremployees– supporting, developing and maintaining a skilled, motivated, fulfilled and safe workforce
• vigilantandalerttosecurityrisks– implementing an effective port security framework
• agoodcorporatecitizen–activelyinvolving ourselves in the community through programs that provide benefit to both ourselves and the regional community in which we exist.
GPC – committed to growth, prosperity and the community
Contents | Gladstone Ports Corporation | Annual Report 2008–092
The Year in Review 7
Performance Summary 8Our performance against our corporate strategies, objectives and targets, as outlined in our Corporate Plan (2009–2014) and Statement of Corporate Intent (SCI)
Chairman’s Review 12An overview of our performance, highlighting our commitment to the growth of our port, our community and the environment
Chief Executive Officer’s Review 15An account of our operational and environmental outcomes for the year, with a particular focus on employee safety and performance
Commercial General manager’s Review 18An overview of our financial performance
Business 21
Our Customers and markets 22Details how we maintain relationships with our customers, through quality customer service and regular communication
Our Trade 26A comprehensive overview of the year’s imports and exports through the Port of Gladstone and Port Alma Shipping Terminal
Our Operations 34A summary of how we maintain our operations to ensure the efficient and effective handling of products through our wharves
Our Port Security 38An outline of our approach to security and the various actions we take to ensure our facilities are secure at all times
Infrastructure 41
Our Projects 42A glance at the projects that have occurred throughout the year and what is planned to prepare us for future trade
Con
tent
s
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usinessYear in R
eview
Contents | Gladstone Ports Corporation | Annual Report 2008–09 3
People 69
Our Employees 70About being an employer of choice and the various initiatives we have in place to assist us in maintaining our low staff turnover rate
Our Safety 80Our approach to ensuring a safe work environment
Our Health 84An outline of the various programs we provide that assist our employees to maintain their health and wellbeing
Corporate Governance 89
Our Board of Directors 90
Our Management Team 94
Corporate Governance Practices 96Details of our Board, Management, and the various processes in place that govern our organisation’s direction
Financial Review 104
Financials 113
Index to Financial Statements 114A complete overview of our financial performance
Glossary 160
Index 161
Environment 49
Our Environmental Management 50Details of our environmental initiatives that ensure we operate in an environmentally sustainable manner
Energy and Greenhouse Gases 59Our approach to reducing greenhouse gas emissions and energy use
Community 61
Our Community Involvement 62An overview of the many ways we are involved with our community
Highlights and Challenges | Gladstone Ports Corporation | Annual Report 2008–094
Hig
hlig
hts
and
Cha
lleng
esAchieved an after tax profit of $55.6 million (2007–08: $39 million). Page 107.
Record coal exports of 56.2mt (2007–08: 54.1mt) were achieved at the Port of Gladstone. Page 30.
Developed and commenced implementation of Environmental Improvements Program. Page 55.
Provided $134,495 in community support. Page 65.
Increased trade by 33.7% through Auckland Point wharves. Page 28.
Formed the GPC Future Directions Indigenous Liaison Group. Page 64.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usinessYear in R
eviewFinancials
Corporate
Governance
People
Com
munity
Environm
entInfrastructure
Business
Year in Review
Highlights and Challenges | Gladstone Ports Corporation | Annual Report 2008–09
Year in Review
5
Increased trade by 35.7% at Port Alma Shipping Terminal, achieving 228,086t in total throughput (2007–08:168,112t). Page 27.
Completed a significant number of recommendations from 2006–07 RGTCT and BPCT benchmarking studies. Page 56.
Completed a Project Feasibility Study for proposed Wiggins Island Coal Terminal. Page 45.
CHALLENGESTotal throughput at the Port of Gladstone fell short of the forecast target of 86mt by 6.9mt, as did coal throughput – 6.8mt short of the forecast 63mt. These results were due to rail restrictions and the effect of the global economic downturn. Pages 27 and 30.
Achieved recertification to ISO 14001:2004. Page 51.
Launched our new website. Page 64.
Achieved a 5-star safety rating through National Safety Council of Australia. Page 81.
Achieved a record throughput of 79.1mt (2007–08: 76.5mt) at the Port of Gladstone. Page 27.
Provided a dividend of $33.2 million (2007–08: 26.9 million) to our shareholders. Page 18.
maintained a low staff turnover rate of <5% and increased our employee numbers from 606 to 646. Pages 71 and 72.
We continue to work with new industry proponents, particularly within the Liquefied Natural Gas (LNG) sector, to facilitate future trade through our ports.Pictured: The Port of Gladstone with Curtis Island in foreground.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usinessYear in R
eview
Year in Review | Gladstone Ports Corporation | Annual Report 2008–09 7
Year in Review
Year in Review 7
Performance Summary 8
Chairman’s Review 12
Chief Executive Officer’s Review 15
Commercial General manager’s Review 18
Year
in R
evie
w
Year in Review | Performance Summary | Gladstone Ports Corporation | Annual Report 2008–098
Per
form
ance
Sum
mar
y
BuSINESSOBJECTIVE: T o carry out port operations in accordance with world’s best practice
TARGETS 2008–09 OUTCOMES
Implement a new customer complaint handling system
23
Implement integrated ‘peer planning’ system to stakeholders
23
Achieve total port throughput of 86.0mt at Port of Gladstone
27
Achieve coal exports of 63.0mt through Port of Gladstone
30
Increase port trade at Port Alma Shipping Terminal to 170,000t
31
Commence implementation of Continuous Improvement Plan across the coal business in relation to terminal reliability
35
Commence Feasibility Study and progress the design of a water recycling system
36
Complete asset life plans using RCm principles
36
Reduce train unloading and shiploading delays at RGTCT to <20%
37
TARGETS 2009–10
Deliver new operational performance metric and measurement system to customers and stakeholders
Implement electronic web based logistics ‘peer planning’ system (Preactor) for supply chain stakeholders
Conduct Corporate Image Study – Customer component in late 2009–10
Achieve total port throughput of 85.9mt at Port of Gladstone
Achieve coal exports of 63mt through Port of Gladstone
Increase port trade at Port Alma Shipping Terminal to 230,000t
Conduct major maintenance and structural refurbishment of Shiploader 2 and three stockpile reclaim tunnels
Commence implementation of Water Recovery and Recycling Strategy
Implement medium-term dust mitigation strategies from 2006–07 Benchmarking Study recommendations
Implement Continuous Improvement Plan across RGTCT and BPCT
Complete feasibility, scope and design for additional stockpile and associated infrastructure at RGTCT
undertake review of Auckland Point 1 wharf facility and its operating strategy
Review and update ports’ maritime security plans
Continue implementation of internal audit plan
Conduct exercises to assess ports’ maritime security plans and Incident management System
Complete upgrade of site access controls
Summary of Statement of Corporate Intent
Achieved
Partially achieved
Not achieved
Ongoing
Exceeded
Our commitment to Growth, Prosperity and our Community is evident within our performance results each year. These words are integral to the way we do business – they represent our purpose and our strategic direction. more details of our outcomes are provided in each section.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usinessYear in R
eviewFinancials
Corporate
Governance
People
Com
munity
Environm
entInfrastructure
Business
Year in Review
Year in Review | Performance Summary | Gladstone Ports Corporation | Annual Report 2008–09 9
Year in Review
INFRASTRuCTuREOBJECTIVE: To provide import and export shipping infrastructure to the Central Queensland region
TARGETS 2008–09 OUTCOMES
Commence EIS process for dredging works to support Channel Duplication Study
43
Complete proposed WICT Full Feasibility Study
45
Complete detailed engineering for proposed WICT
45
Complete dredging approval process for LNG development on Curtis Island
46
ENvIRONmENTOBJECTIVE: To maintain the environmental integrity of the Port of Gladstone and Port Alma in line with
community and stakeholder expectations
TARGETS 2008–09 OUTCOMES
Achieve re-certification of ISO 14001:2004
51
Implement the agreed recommendations of the RGTCT and BPCT benchmarking studies
56
Reduce community complaints to <20 58
Continue energy usage evaluation process and begin examining and implementing projects that will reduce GPC’s energy use
59
1. Mangroves and creek systems border the Port of Gladstone.
2. Gladstone Port Central (Auckland Point wharves).
1 2
TARGETS 2009–10
Complete construction of RGTCT refuelling facility and car wash
Complete Detailed Design phase for proposed Wiggins Island Coal Terminal in late 2009
Complete EIS approvals process for Northern Reclamation Project at Fisherman’s Landing
Commence construction works on perimeter bunds at Fisherman’s Landing
Complete EIS approvals process for Western Basin Dredging and Disposal Project
Commence detailed investigations associated with EIS for future Harbour Channel Duplication
TARGETS 2009–10
maintain the ISO 14001:2004 environmental management system
Continue progressively implementing the Environmental Improvements Program, including the recommendations from the RGTCT and BPCT benchmarking studies
Year in Review | Performance Summary | Gladstone Ports Corporation | Annual Report 2008–0910
Per
form
ance
Sum
mar
y co
nt... COmmuNITY
OBJECTIVE: To actively involve ourselves in the community through programs that provide benefit to both ourselves and the regional community in which we operate
TARGETS 2008–09 OUTCOMES
Launch new website 25, 64
Host inaugural Fun Run 63
Install a sewage disposal facility for all marina vessels
67
PEOPLEOBJECTIVE: To support, develop and maintain a safe workplace and a skilled, motivated,
fulfilled workforce
TARGETS 2008–09 OUTCOMES
Implement Reclassification Process 72
Renegotiate an extension or variation to existing certified agreement
72
Implement Leadership Development Program in July 2008
76
Implement Human Resources management System
79
Conduct Employee Engagement Survey 79
maintain NSCA 4-star safety rating 81
Reduce LTIFR to zero 80
Implement revised Incident / Accident Process
82
Implement new process for Hazardous Substances and Dangerous Goods management
82
Conduct Physical Risk Surveys 82
Implement Contractor Safety management Extranet
83
Implement Stop Sun Spots Pilot Program 84
TARGETS 2009–10
Host biennial Port Open Day in October 2009
Host inaugural Fun Run in June 2010
Conduct a Corporate Image Study
Finalise plans for a sewage disposal facility for all marina vessels by end 2009–10
Complete Stage 1 of new marina boat ramp
TARGETS 2009–10
Successfully negotiate three-year Federal Enterprise Agreement by November 2009
Review and enhance Leadership Development Program
Complete implementation of Human Resources management System
Continue implementation of Process
Conduct Corporate Image Study – Employee component
maintain NSCA 5-star safety rating
Reduce LTIFR to zero
Implement Random Drug Testing and Fatigue Risk management
Revise and implement Incident Investigation Process
Continue implementation of Stop Sun Spots program
Achieved
Partially achieved
Not achieved
Ongoing
Exceeded
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usinessYear in R
eviewFinancials
Corporate
Governance
People
Com
munity
Environm
entInfrastructure
Business
Year in Review
Year in Review | Performance Summary | Gladstone Ports Corporation | Annual Report 2008–09 11
Year in Review
CORPORATE GOvERNANCEOBJECTIVE: To provide the vision and direction to promote and develop business opportunities whilst
ensuring compliance with legal and contractual obligations
TARGETS 2008–09 OUTCOMES
Achieve 100% compliance with ASIC requirements
99
Introduce Capital Investment System 101
Ensure governance structure and procedures for WICT are robust
101
Assess all fraud risks 102
Review and update Board and Committee charters
103
FINANCIALSOBJECTIVE: To earn commercial long-term rates of return on shareholders’ funds; generate funds
to meet port infrastructure requirements; retain current and develop future business opportunities; and maintain a sound financial position
TARGETS 2008–09 OUTCOMES
Provide dividend of $24.3 million (80% of after tax profit)
18
Achieve 4.1% EBIT return on assets 18
Achieve after tax profit of $30.3 million 109
TARGETS 2009–10
Continue to review remaining Board and Committee charters
Achieve 100% compliance with ASIC Requirements
Introduce Capital Investment System for all projects
TARGETS 2009–10
Achieve after tax profit of $37.7 million
Provide dividend of $30.1 million (80% of after tax profit)
Achieve 5.8% EBIT return on assets
1. Coal is loaded into the hatch of a vessel.
2. A vessel berthed at RGTCT.
1 2
Year in Review | Chairman’s Review | Gladstone Ports Corporation | Annual Report 2008–0912
Cha
irman
’s R
evie
w We experienced a challenging year, but one that has delivered pleasing results regardless. Although the global economic downturn created uncertainty in our markets and associated industries, we still managed to return a dividend of $33.2 million to our shareholders – an increase of 23.4% on last year’s result. See our Commercial General manager’s Review (page 18) for more information.
Preparing for the futureOur commitment to trade growth and diversification through our ports, benefits not only Gladstone, but also the wider region, the state and the country. Central to growth is the role we play in facilitating the development of new industry. During the year, we continued to work with new industry proponents, particularly within the Liquefied Natural Gas (LNG) sector, to progress design phases and develop appropriate shipping strategies to ensure the safe and effective transfer of their product.
Indeed, our efforts to expand and consolidate to facilitate future trade through our ports saw us progress plans for the expansion of Fisherman’s Landing throughout the year. An Environmental Impact Statement (EIS) for the proposed 153 hectares (ha) Northern Reclamation Project was submitted, and preliminary EIS processes for the Western Basin Dredging Project commenced. We are also investigating modifications required to better equip the facility to handle LNG carriers.
It is expected that LNG industry will be developed adjacent to Fisherman’s Landing and on Curtis Island, with the state government expanding the Gladstone State Development Area to include land on Curtis Island during the year.
Dredging works, associated with Rio Tinto Alcan’s Yarwun alumina refinery Stage Two, commenced at Fisherman’s Landing during the year, with the project expected to be completed by September 2009.
Disappointingly, the development of the proposed Wiggins Island Coal Terminal (WICT) has been delayed, as commercial negotiations were still to be finalised at the end of 2008–09. It is expected that commercial agreements will be reached in the coming year, with construction expected to occur in late 2010. See Infrastructure (page 45) for more information.
Ian Brusasco amChairman
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usinessYear in R
eviewFinancials
Corporate
Governance
People
Com
munity
Environm
entInfrastructure
Business
Year in Review
Year in Review | Chairman’s Review | Gladstone Ports Corporation | Annual Report 2008–09 13
Year in Review
Although impacted by the current world economic crisis, coal trade remains, by far, our main product exported through the Port of Gladstone. In fact, coal exports are predicted to grow from 56.2 million tonnes (mt) (achieved in 2008–09) to 72mt over the next three years. Our aim each year is to continue improving our coal handling operations to ensure the efficiency of our expanded assets and that we meet our target throughput. To achieve this, we implemented a three-year Continuous Improvement Program upon completion of the RG Tanna Coal Terminal (RGTCT) Expansion Project at the end of 2007. Now in its second year, the program involves the review of our operational practices, cost structures and services at both RGTCT and Barney Point Coal Terminal (BPCT). We are also working in collaboration with our rail operators and coal mining companies to improve coal handling logistics. See Our Trade (page 30) and Our Projects (page 43) for more information.
Xstrata Coal commenced pre-feasibility studies and geotechnical works for the development of a coal export facility at Port Alma Shipping Terminal during the year. The pre-feasibility phase is expected to be completed by early 2010. See Our Projects (page 45) for more information.
maintaining the trust of our communityIt is important that we have the community’s full support, for our day-to-day operations and our expansion projects. We continue to improve on our communications and consultation with community members to ensure they are kept informed of current and future port activities.
Of particular importance to our community, is the potential impact our operations have on the environment. A number of initiatives have been put in place at the Port of Gladstone during the year, in an effort to minimise coal dust generation from RGTCT and BPCT. These actions were from a list of short and medium term recommendations resulting from the 2007–08 RGTCT and BPCT Benchmarking Studies. We will continue to implement these requirements, along with those under our Environmental management System, throughout the coming year to ensure we maintain the environmental integrity of our ports in line with community and stakeholder expectations. See Our Environment (page 56) for more information.
We are a mandatory participant under the Australian Government’s Energy Efficiency Opportunities (EEO) Program, an initiative to encourage large energy using businesses to improve their energy efficiency. Our EEO team has been working to fully implement the program across our port operations, introducing it to employees and developing the necessary systems to ensure our obligations under the EEO Legislation are met. Already a number of opportunities have been identified and reviewed by the Board, with some significant improvements made, particularly through the purchase of more fuel efficient equipment. We are also a mandatory participant under the National Greenhouse Gas and Energy Reporting Act and will provide our first public
report in October 2009. See Our Environment (page 59) for more information.
Our support of community groups and non-profit organisations continues through our Community Support Program. In 2008–09 we provided $134,495 in sponsorships and donations in the areas of art, music and cultural activities, education, health and welfare, environmental initiatives, and major events.
A particular highlight for 2008–09 – in June 2009, with the assistance of our coal customers, we purchased Gladstone’s marley Brown Oval. The sporting oval was closed after the Gladstone League’s Club was put into receivership in 2007. Realising the importance of the oval and its iconic status to the Gladstone community, we worked with state government and our coal customers to purchase the oval and return it to the community. See Our Community (page 65) for more information.
1. As the Port of Gladstone continues to grow, we will maintain our role as a good corporate citizen, providing recreational facilities such as our Marina and its parklands (pictured) for the enjoyment of the community.
1
Year in Review | Chairman’s Review | Gladstone Ports Corporation | Annual Report 2008–0914
The year aheadI am certain we will continue to witness further effects of the world economic crisis in 2009–10, but I am confident we will again deliver many positive outcomes – particularly in relation to the growth of trade through our ports. We will continue to facilitate the development of LNG industry in Gladstone and maximise our coal handling facilities for the benefit of our stakeholders.
The continued implementation of environmental improvements across our port facilities will remain a key priority in the coming year, to minimise the effect of our coal handling operations on our neighbouring communities and to ensure we maintain environmentally sustainable work practices.
We will undertake another Corporate Image Study, providing insight into the opinions of our community, customers and employees on our performance. The results of this study will be considered in the development of our corporate strategies to ensure we meet stakeholder expectations in the next financial year and beyond.
We will take control of the Port of Bundaberg from the Port of Brisbane Corporation in the coming year, following Queensland Premier, Anna Bligh’s announcement on 2 June 2009. The implications of this direction are not yet finalised. We will work with state government to facilitate this process.
In recognition of the state government’s assistance in funding the RGTCT Expansion Project, completed in late 2007, we will repatriate $90 million of issued capital to shareholders in December 2009.
Cha
irman
’s R
evie
w c
ont..
. AcknowledgementsThe determination and commitment of management and employees throughout the year has seen us achieve a positive result for 2008–09 – I thank our GPC team for helping overcome the challenges the year has presented.
I thank our employees for also maintaining their strong commitment to safety throughout their day-to-day operations – a fantastic effort was put in by all throughout the year.
Thank you to our shareholding ministers for 2008–09 – the Treasurer and minister for Employment and Economic Development, the Honourable Andrew Fraser mP, the minister for Transport, the Honourable Rachel Nolan mP, and previous minister for Transport, the Honourable John mickel mP, for their support and assistance in the operations of our ports.
I also thank my fellow Board Directors for their valuable contribution during the year. my congratulations go to fellow Director and former Gladstone mayor Peter Corones on becoming a member of the Order of Australia (Am) in January 2009. Peter was recognised for his service to the Gladstone region, through local government, transport infrastructure, education, water, economic and industrial development.
I anticipate another challenging year for 2009–10, but I am certain that we will sustain our commitment to the growth of Gladstone, its industrial sector and trade, creating prosperity for Queensland and our local community.
Ian Brusasco amChairman
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usinessYear in R
eviewFinancials
Corporate
Governance
People
Com
munity
Environm
entInfrastructure
Business
Year in Review
Year in Review | Chief Executive Officer’s Review | Gladstone Ports Corporation | Annual Report 2008–09 15
Year in Review
Chi
ef E
xecu
tive
Offi
cer’s
Rev
iew Despite the difficult economic climate, the Port of Gladstone
is consolidating plans for future infrastructure growth in its role of enhancing Central Queensland’s economic development and helping Gladstone become Australia’s 21st century industrial city. Port employment opportunities have improved, new safety records achieved and increased demand for our coal exports to India and China have rallied an otherwise difficult year imparted upon by the global financial crisis.
Ensuring a safe work placeI am proud to note that we achieved a 5-star rating from the National Safety Council of Australia (NSCA) for our Safety management System. This accreditation for Lost Time Injury (LTI) improvements represents a continued commitment to safety across the Port of Gladstone and Port Alma Shipping Terminal and illustrates the response to our ethos of striving to provide a safe working environment for the entire workforce. We experienced 7 LTIs during 2008–09, giving us a Lost Time Injury Frequency Rate (LTIFR) of 4.81. Our goal for 2009–10 is to maintain the NSCA 5-star safety rating and reduce our LTIFR to zero. See Our Safety (page 80) for more information.
Facilitating growthConcerted commercial negotiations and infrastructure planning for the development of Liquefied Natural Gas (LNG) industry on Curtis Island gained momentum throughout the year, with 7 LNG industry proponents currently vying for a stake in this market. The BG Group and Santos have both signed agreements to supply LNG from their proposed Gladstone plants. Work on Environmental Impact Statements (EISs) for the Fisherman’s Landing and Western Basin area expansions continued during 2009, with dredging planned to facilitate these developments and the proposed Wiggins Island Coal Terminal. With such a strong focus on growth, we also realise the importance of minimising environmental and community concerns and continue to plan and implement long-term mitigation and environmental compensation initiatives to ensure the sustainability of our local environment. See Our Projects (page 46) for more information.
Leo Zussino Chief Executive Officer
Year in Review | Chief Executive Officer’s Review | Gladstone Ports Corporation | Annual Report 2008–0916
Achieving record trade against all oddsDespite world trade continuing to experience the effects of the global economic downturn, the Port of Gladstone managed to achieve record coal exports of 56.2mt, an increase of 5.1% on last year’s results. Although short of our target (63mt), the slight increase in coal trade was due to the increasing demand for coal from Chinese and Indian coal customers. Our total throughput at the Port of Gladstone was 79.1mt, an increase of 3.5% on last year, yet 8.7% short of our set target of 86mt.
Pleasingly, a rise in ammonium nitrate exports saw Port Alma Shipping Terminal record a 35.7% increase in trade, totalling 228,086 tonnes (t) for 2008–09. See Our Trade (page 27) for more information.
The unstable economic environment also impacted on commercial negotiations for the development of the proposed WICT project, resulting in construction commencement delayed to late 2010. See Our Projects (page 45) for more information.
meeting environmental obligationsEnvironmental improvements continue to be a focus of our operations and port planning. Our Environmental management System was re-certified to ISO 14001:2004 during the year. Recommendations from the RGTCT and BPCT benchmarking studies, to minimise coal dust generation, are progressively being implemented. The community is kept informed via regular communication and face-to-face consultation. See Our Environment (page 51) for more information.
Building on business performanceWe continued our focus on optimising our operational and asset performance to ensure our stakeholders’ needs are met. maintenance shutdowns at both RGTCT and BPCT continued throughout the year, improving unloading and loading capacity and general operations. See Our Operations (page 36) for more information.
A new coal mine, Lake vermont, commissioned north of Blackwater, commenced exports through the Port of Gladstone in late 2008, lifting our total number of supplying coal mines to 18. Our service levels were improved by a new customer complaints handling system, along with an increased number of customer forums to improve communications. These strategies are an essential part of our Continuous Improvement Program, to ensure an open and transparent relationship with our customers.
Our new website was launched during the year, providing both customers and the public with easy access to information about all aspects of our operations. See Our Customers and markets (page 25) for more information.
Chi
ef E
xecu
tive
Offi
cer’s
Rev
iew
con
t...
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usinessYear in R
eviewFinancials
Corporate
Governance
People
Com
munity
Environm
entInfrastructure
Business
Year in Review
Year in Review | Chief Executive Officer’s Review | Gladstone Ports Corporation | Annual Report 2008–09 17
Year in Review
Increasing our employee numbersOur employee numbers continue to climb, reaching 646 as at 30 June 2009. Our employees’ diverse skills and knowledge will be relied on to take the ports forward into the next decade of growth. Further opportunities for learning and development will continue to be offered to employees, especially in the area of leadership as we enter our second year of our Leadership Development Program. The provision of Indigenous training and employment opportunities will remain a focus within our operations, as we continue our Gladstone Industries’ Aboriginal and Torres Strait Islander (ATSI) Youth Employment Program in conjunction with our local industries. See Our People (page 77) for more information.
Enhancing community partnershipsOur relationship with the community where our port facilities are located will always be central to our operations and our achievements as a good corporate citizen. Our community engagement initiatives were enhanced throughout the year, with the introduction of our GPC Indigenous Future Directions Liaison Group. We look forward to enhancing our relationship with our local Indigenous community and ensuring mutual benefits from that relationship.
Our Gladstone marina and foreshore parklands are the staging points for many popular community events – an appealing, family-focused environment that we are pleased to offer for local residents’ enjoyment. Preparations are well underway for our Port Open Day, to be held at the marina in October 2009. Staged biennially, this
free community event involves the efforts of many employee volunteers, providing port tours, industry displays, a sausage sizzle lunch, live entertainment and more. See Our Community Involvement (page 65) for more information.
The year aheadOur future is likely to be shaped by decisions about the LNG industry in 2009–10 and by the state of the world economy. Our planning for the Wiggins Island and LNG projects will ensure that we can take advantage of favourable circumstances when they arise.
While preparing for future infrastructure expansion, we will not lose sight of our safety, environmental and community obligations.
A priority will be the implementation of the Energy and Greenhouse Declaration of Commitment, designed to manage risks connected with climate change and involving public reporting to external stakeholders. Further improvements will be sought through the application of the coal dust mitigation strategy. Rigorous planning will continue to ensure dredging within the Western Basin, associated with the development of the LNG industry, has appropriate environmental offsets.
Every effort will be made to ensure we foster a holistic approach to safety, maintaining our 5-star safety rating and a commitment to reducing our LTIFR to zero.
We will conduct our biennial Corporate Image Study, to assess feedback from our customers, community and employees, enabling us to assess our performance in the eyes of those who matter the most.
Acknowledgementsmy thanks go to our Senior management team and our entire workforce for their efforts during what has been a difficult year.
I would also like to thank our Chairman, Ian Brusasco, for his work in heading up our Board. Our Board Directors and shareholding ministers make a vital contribution to our business, addressing their roles with energy and valued experience, and assisting us in realising our goals.
Leo Zussino Chief Executive Officer
1. Curtis Island (pictured) is earmarked to become the hub of Gladstone’s future Liquefied Natural Gas industry.
1
Year in Review | Commercial General manager’s Review | Gladstone Ports Corporation | Annual Report 2008–0918
Com
mer
cial
Gen
eral
man
ager
’s R
evie
w
Shareholder returnsEarningsRevenue grew by 15.7%, to $307.3m. Gains from the revaluation of assets accounted for $14.8m. The improvement in revenue over the last three years has been driven by increased coal exports, a new coal cargo handling agreement and steady tonnages across all areas of our business.
Earnings before interest and tax (EBIT) grew by 35.6%. This was partially driven by the gains from the revaluation of non-current assets and investment properties, with a 15.7% increase in revenue from trading also contributing to the overall result. Expenses increased by 6.9%, primarily due to a 12.4% increase in employee costs.
The 2009 final dividend saw an increase of 23.4% to $33.2m as a result of the increased revenue from cargo handling.
Through the challenges of the year, we maintained our goal to maximise shareholder return to achieve new records of growth across our operations – increasing our revenue to $307.3m (2007–08: $229.9m) and deliver a dividend of $33.2m (2007–08: $26.9m).
Mike Galt Commercial General Manager
AssetsAssets for the 2009 financial year totalled $1,611m, an increase of 11.6% on 2008. The increase is primarily a result of the Wiggins Island Coal Terminal Full Feasibility and Detailed Design Project.
Our return on assets of 7.3% showed an improvement on 2008. This was driven by the capacity increases associated with the RGTCT Expansion Project.
DividendsWe provided a $33.2m dividend to shareholding ministers for 2009, based on 80% of after tax profits after adjusting for upwards revaluations, and removing the impact of the purchase of the marley Brown Oval for the Gladstone community. This dividend is in line with our dividend policy and the policy is the same as for 2008.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usinessYear in R
eviewFinancials
Corporate
Governance
People
Com
munity
Environm
entInfrastructure
Business
Year in Review
Year in Review | Commercial General manager’s Review | Gladstone Ports Corporation | Annual Report 2008–09 19
Year in Review
EmploymentWage expenseWages are one of our largest expenses, totalling $65.4m in 2009. This represents an increase of 11.4% on 2008. It is a direct result of the increase in employees to 646 (2007–08: 606) due to the RGTCT Expansion Project becoming operational.
SuppliersTotal suppliesTotal procurements costs for supplies and contracted works for 2009 were $72.6m, in line with 2008: $73.0m.
Objectives Indicators 2009 2008
Change 2008
to 2009 (actual)
Target 2009
variance 2008
to 2009 (actual
to target)
2007 2006 2005
Maximise shareholder return through the provision of quality commercial facilities and services
Operating revenue ($m) 307.3 265.5 15.7% 282.1 8.9% 224.1 151.9 135.5
EBIT ($m) 110.9 81.8 35.6% 79.9 38.8% 53.6 24.9 20.9
Total assets ($m) 1,611.0 1,443.8 11.6% 1,396.4 15.4% 1,252.2 1,052.3 651.7
Return on assets (%)
7.3 6.1 19.7% 5.7 28.1% 4.7 2.9 3.5
Capital investments ($m)
109.5 139.9 (21.7)% 60.6 80.7% 407.8 250.6 39.7
Dividends ($m) 33.2 26.9 23.4% 22.1 50.2% 5.0 7.0 5.6
Taxes paid to all taxing authorities ($m)
18.3 10.5 74.3% 16.3 12.3% 1.3 1.3 1.3
mAXImISING SHAREHOLDER RETuRNS
Local purchasesOur purchasing continued to support local businesses throughout the year. Gladstone area supplies were $21.6m or 29.8% of purchases in 2009. This represents a decrease in local purchases of 12.6% on 2008 ($24.7m – 33.9% of purchases).
The year aheadThe year ahead will see us continue to identify and develop new port infrastructure for the benefit of all stakeholders. Accompanying this growth will be new financial challenges such as obtaining the appropriate funding to support new infrastructure and ensuring our operations continue to provide efficient and economic capital investment and operational costs, while meeting community and environmental standards.
Our key challenges for 2010 are to:
• increasetonnagethroughputand begin to generate a return on the RGTCT Expansion Project assets
• contributetocoalsupplychain maximisation strategies to ensure the best possible throughput is achieved
• continuetofacilitateporttradeopportunities for existing and new customers to improve both their revenues and ours
• maintainefficientcoststructures.
mike Galt Commercial General manager
Over 30 major products pass through our ports, with exports to over 35 countries.Pictured: One of RGTCT’s three shiploaders loads coal into a vessel.
Business | Gladstone Ports Corporation | Annual Report 2008–09 21
Bus
ines
s
21
Business 21
Our Customers and markets 22
Our Trade 26
Our Operations 34
Our Port Security 38
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usiness
22 Business | Our Customers and markets | Gladstone Ports Corporation | Annual Report 2008–09
Our
Cus
tom
ers
and
mar
kets
A new coal mine, Lake Vermont, situated north of Blackwater, commenced exports through our RG Tanna Coal Terminal (RGTCT) in late 2008, assisting us in increasing our customer base – one of our ongoing objectives.Pictured: RGTCT’s Shiploader 3.
Business
23Business | Our Customers and markets | Gladstone Ports Corporation | Annual Report 2008–09
Outcomes 2008–09Implemented a new customer response and complaint handling system
Implemented a web-based shipping information system
Targets 2009–10Deliver new operational performance metric and measurement system to customers and stakeholders
Implement electronic web based logistics ‘peer planning’ system (Preactor) for supply chain stakeholders
Continue implementation of Continuous Improvement Program and Capricorn Coal Chain maximisation Project
Conduct Corporate Image Study – Customer component in late 2009–10
Providing quality service to our customersOur customers are critical to our success, so we remain committed to providing the best level of customer service and aligning our processes with their needs.
We understand the importance of maintaining close relationships with our customers to ensure their needs are met. Our customers, which include coal and other cargo companies, logistics support providers (such as rail operators), shipping lines and agents, port service providers (such as tugboat operators and marine pilots) and port facility operators, regularly visit the port and tour our port facilities, fostering an open and transparent relationship. Customer tours provide us with an opportunity to informally discuss existing and potential business opportunities. These tours also enable our customers to view, first hand, our handling facilities and capabilities.
In 2008–09, 610 representatives (2007–08: 469) of our customers, from 93 companies (2007–08: 96), visited the Port of Gladstone, met with management and toured our facilities – 143 of these were acting on behalf of new or prospective customers.
A new coal mine, Lake vermont, situated north of Blackwater, commenced exports through RGTCT in late 2008, assisting us in increasing our customer base – one of our ongoing objectives.
We work closely with our coal customers and rail operators to review and improve our operational practices, levels of service, efficiencies, cost structures, and coal loading facilities through our Continuous Improvement Program and Capricorn Coal Chain maximisation Project.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usiness
Business | Our Customers and markets | Gladstone Ports Corporation | Annual Report 2008–0924
Our
Cus
tom
ers
and
mar
kets
con
t... valuing our
customers feedbackIn order to guarantee the integrity of our existing and future relationships with customers, we are dedicated to continuous improvement in our dealings with them.
Every two years we undertake a Corporate Image Study to gain valuable customer feedback. The insights gained from this study form the basis for long-term strategies that foster stronger customer relationships. We will conduct our next study in late 2009.
We commenced the development of a new, operational performance metric and measurement system during the year. The system, to be implemented in 2009–10 will ensure our customers and stakeholders are more involved with our operational performance. This encourages a higher level of customer confidence in our ability to deliver on operational commitments.
Our new customer response and complaints handling system was introduced this year. It will improve our customer service levels by capturing any issues related to service levels such as port protocol application, non conformance with instructions or contamination of products. It ensures that all incidents are reported in a transparent and sensitive manner via regular customer forums. As a result of this improved reporting, the number of items captured for 2008–09 increased to 49 (2007–08: 16). Each issue was formally investigated by port personnel and satisfactorily resolved through individual discussion with the customers involved.
1. Gladstone Port Central’s fuel farm area.
2. Calcite, a high-grade form of white limestone (used as an industrial filler in paints, toothpaste and make-up), is one of 30 products handled at the Port of Gladstone.
1
2
Business
25Business | Our Customers and markets | Gladstone Ports Corporation | Annual Report 2008–09
Looking aheadDuring 2009–10 we will review and implement a new key performance indicator reporting system in conjunction with our customers, aimed at providing greater transparency of our operational performance.
We will conduct another Corporate Image Study to assess our customers’ opinions of our performance and identify the necessary actions to address any areas highlighted for improvement.
A new web-based logistics ‘peer planning’ system will be introduced to fully integrate our planning processes with our customers and stakeholders, ensuring system throughput is maximised.
Communicating with our customersTo keep our customers informed about current and future port activities and plans we use of a variety of communication tools, including:
• weeklyshippingstatusreports
• monthlyportperformancemeetings with shipping companies
• monthlyshippingprotocolmeetings
• quarterlycustomerexecutivemeetings
• ourwebsite
• ourquarterlynewsletter Port Talk
• ourAnnualReport.
Our customers also have access to Port Information Handbooks for the Port of Gladstone and Port Alma, a Coal Port brochure and a Port of Gladstone brochure. Each of these publications is available in hard copy from our Community Relations department and on our website www.gpcl.com.au.
In October 2008, we launched our new website in order to improve our communications with our existing and prospective customers and the general public.
The website has a contemporary and user friendly design, providing easy access to information on our operations and includes current shipping schedules; port charges; statistics; trade performance; tides and weather; port access card applications; procurement information; details of various cargoes handled; corporate and community publications and the latest news. To improve our business relationship with our key international customers, hyperlinks to Japanese, korean and Chinese versions of our website will be available on the site’s homepage by late 2009.
Our managers maintain regular contact with customers by phone, email and through face-to-face meetings. During 2008–09 our CEO, Leo Zussino, gave a series of presentations to our customers, outlining the current status and future outlook for GPC.
We also host a number of informal gatherings annually, enabling our customers to meet with representatives of our management team and other port customers.
Customer, port planning and operational processes were also refined during the year with the introduction of a web-based shipping information system. The system replaces the existing manual process, enabling more efficient and secure transfer of critical shipping information between our port personnel and customers. Customers access the password protected system via our website.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usiness
26 Business | Our Trade | Gladstone Ports Corporation | Annual Report 2008–09
Our
Tra
de
Despite the year’s economic challenges, a record 79.1 million tonnes (Mt) was handled through the Port of Gladstone during 2008–09, an increase of 2.6Mt (3.2%) on 2007–08 results. This increase was due to the sustained demand for coal from Asian countries, combined with the ongoing, steady trade associated with the alumina industry.Pictured: RGTCT’s wharf facility at dusk.
Business
27Business | Our Trade | Gladstone Ports Corporation | Annual Report 2008–09
Handling a diverse range of productsOver 30 major products pass through GPC’s facilities, with exports to over 35 countries. The major products include coal, alumina, aluminium and cement.
Coal is our largest export commodity. Thermal coal fuels the boilers of power stations in Japan, Hong kong, Taiwan, South korea and Israel, whilst coking coal is used for the blast furnaces of steel mills in Japan, South korea, Taiwan, China, India, Italy and France.
Our senior managers and Port Planning employees continue to work with representatives from new and potential industries to diversify trade through our ports. This year they worked closely with Liquefied Natural Gas (LNG) industry proponents to facilitate the development of LNG industry in Gladstone.
Strong port throughputDespite the year’s economic challenges, experienced globally, a record 79.1 million tonnes (mt) was handled through the Port of Gladstone during 2008–09, an increase of 2.6mt (3.2%) on 2007–08 results. This increase was due to the sustained demand for coal from Asian countries, combined with the ongoing, steady trade associated with the alumina industry. During 2008–09, import cargoes accounted for 21% and export cargoes 79% of total trade throughput at the Port of Gladstone. Fifteen major cargoes were imported from 18 countries while 18 major cargoes were exported to 38 countries.
Port Alma Shipping Terminal’s throughput during the year totalled 228,086 tonnes (t), an increase of 59,974t (35.7%) from 2007–08. This increase in trade was due to an increase in ammonium nitrate exports (43.0%). During 2008–09, import cargoes accounted for 21.4% and export cargoes 78.6% of total trade throughput at Port Alma Shipping Terminal. Four main cargoes were imported from 15 countries and four main cargoes were exported to 13 countries.
See our World Trade map (page 32) for more information.
Outcomes 2008–09Achieved total port throughput of 79.1mt (2007–08: 76.5mt) at Port of Gladstone
Achieved record coal exports of 56.2mt (2007–08: 54.15mt) at Port of Gladstone
Achieved total port throughput of 228,086 t (2007–08: 168,112t) at Port Alma Shipping Terminal
Targets 2009–10Achieve total port throughput of 85.9mt at Port of Gladstone
Achieve coal exports of 63mt through Port of Gladstone
Increase port trade at Port Alma Shipping Terminal to 230,000t
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usiness
28 Business | Our Trade | Gladstone Ports Corporation | Annual Report 2008–09
Our
Tra
de c
ont..
. Gladstone wharf centresThe Port of Gladstone has 6 main wharf centres, encompassing 15 wharves. These are:
• RGTannaCoalTerminal(RGTCT) – four wharves
• SouthTreeswharves–two wharves
• BoyneWharf–onewharf
• Fisherman’sLanding–three wharves
• AucklandPointwharves(Gladstone Port Central) – four wharves
• BarneyPointCoalTerminal(BPCT) – one wharf.
RGTCT has continued to grow with record exports of 52.4mt through the terminal, an increase of 2.9mt (6.0%) on 2007–08. This represented 66.2% of total port throughput.
South Trees wharves handled 17.7% (14.0mt) of total port throughput, an increase of 0.4mt (2.7%). This was due to increases in bauxite and caustic soda imports used for the production of alumina.
Boyne Wharf achieved 0.6mt throughput during 2007–08, up (6.2%) on 2007–08. Aluminium exports recorded 0.4mt, an increase of 6.9% on last year.
Fisherman’s Landing wharves handled 6.5mt (8.2%) of cargo during 2008–09. This represented a decline of 0.3mt (4.2%) from 2007–08 which can be attributed to decreases in cement product exports (16.6%), cement clinker exports (10.0%) and alumina exports (5.9%).
Gladstone Port Central (Auckland Point wharves and BPCT) handled 5.7mt of cargo during 2008–09, 7.2% of total port throughput. Auckland Point wharves recorded a 33.7% increase in throughput during the year due mainly to an increase in grain (2333%) and calcite exports (8.8%). Petroleum imports recorded an increase of 8.8% during the year. BPCT handled 3.8mt of coal during 2008–09, a decrease of 0.9mt (18.7%) on 2007–08. This decrease was offset by RGTCT which saw total coal exports increased by 2.1mt throughout the port.
THROuGHPuT BY INDuSTRY Coal industry
Alumina industry
Cement industry
Other cargoes
Petroleum industry
Aluminium industry
Grain industry
Per
cent
age
(%)
Financial year
2006–07 2007–08 2008–09
80
60
40
20
0
0.3
1.0
67.2
26.3
69.3
0.2
0.8
1.3
1.5
2.1
24.8
70.8
0.0
0.8
1.3
1.2
1.9
24.0
71.0
0.6
0.8
1.3
1.3
1.6
23.4
1.2
2.1
2.5
2004–05
24.0
68.9
2005–06
0.1
0.9
1.3
1.8
2.4
Business
29Business | Our Trade | Gladstone Ports Corporation | Annual Report 2008–09
Wharf centres 2008–09 2007–08 Difference (%)
Total throughput – Port of GladstoneRG Tanna Coal Terminal (RGTCT)Total wharf centre (tonnes) 52,396,680 49,447,054 6.0No. of vessels 597 549 8.7
South TreesTotal wharf centre (tonnes) 13,977,391 13,614,620 2.7No. of vessels 248 248 0.0
Boyne Total wharf centre (tonnes) 625,706 589,194 6.2No. of vessels 61 68 -10.3
Fisherman’s LandingTotal wharf centre (tonnes) 6,456,814 6,737,683 -4.2No. of vessels 219 235 -6.8
Auckland Point Total wharf centre (tonnes) 1,883,364 1,408,224 33.7No. of vessels 204 180 13.3
Barney PointTotal wharf centre (tonnes) 3,806,303 4,683,307 -18.7No. of vessels 68 82 -17.1
Total cargo (tonnes) 79,146,258 76,480,082 3.5No. of vessels 1,397 1,362 2.6
Total throughput – Port AlmaTotal cargo (tonnes) 228,086 168,112 35.7No. of vessels 88 55 60.0
TOTAL PORT THROuGHPuT
1. Vessels anchored off Gladstone.
1
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usiness
30 Business | Our Trade | Gladstone Ports Corporation | Annual Report 2008–09
Our
Tra
de c
ont..
. Growth in coal exportsCoal exports for 2008–09 totalled a record 56.2mt, an increase of 2.1mt (5.1%) on 2007–08 figures. Despite the increase in coal revenue, our total coal throughput was constrained due to rail restrictions and the global economic downturn, resulting in a shortfall against our 2008–09 target of 63mt.
Coal exports to Asia increased by 4.6mt (9.8%) due to strong increases in the Chinese (4mt or 535.8%) market. Asian countries accounted for 91.3% of total coal exported, with Japan remaining the number one importer of coal, capturing 36.4% of coal exports from the Port of Gladstone. European markets recorded a decrease in imports of 1.1mt (25.4%) with American markets also recording a drop in imports of 1.0mt (39%).
Japan 36%
korea 20%
Taiwan 13%
India 11%
China 9%
Europe 6%
South America 3%
Other Asia 2%
PORT OF GLADSTONE mAJOR COAL mARkETS
1. RGTCT’s stockpile area.1
RGTCT 66.2%
South Trees 17.7%
Fisherman’s Landing 8.2%
Barney Point 4.8%
Auckland Point 2.4%
Boyne 0.8%
PORT OF GLADSTONE THROuGHPuT BY WHARF CENTRE
31Business | Our Trade | Gladstone Ports Corporation | Annual Report 2008–09
Port industry growthPort of GladstoneThe coal industry accounted for 71% of the port’s total throughput, with total coal exports of 56.2mt representing a new port record. A new terminal record was set for RGTCT with exports reaching 52.4mt during 2008–09. Alumina industry cargoes associated with Queensland Alumina Limited (QAL) and Rio Tinto Alcan’s Yarwun refinery contributed 24% of the port’s total throughput. Bauxite imports of 13.1mt represented an increase of 0.1mt (0.7%), whilst alumina exports of 4.1mt were marginally up on 2007–08 figures, setting another new port record. Caustic soda imports associated with the alumina industry of 1.4mt was up 6.8% on 2007–08 figures.
Cement Australia’s cargoes contributed 1.8% of total port throughput, a decrease of 0.1%. The main cargoes, cement clinker and cement exports, were down 10% and 16.6% respectively on 2007–08 figures.
An increase in ‘other cargoes’ of 8.6% was achieved, with imports of liquid ammonia (associated with Orica) increasing by 35,090t on 2007–08 figures. This tonnage also set a new port record for this cargo.
Port Alma Shipping TerminalAt Port Alma Shipping Terminal, ammonium nitrate exports decreased by 18,773t (18.5%) whilst imports increased 72,474t (310.3%) on 2007–08 figures. Primary industry trade cargoes accounted for 14.7% of the terminal’s total throughput, a decline from 17.7% in 2007–08. Total trade throughput for the terminal was 228,086t, an increase of 35.7% on 2007–08.
Industrial trade 85.3%
Primary industry trade 14.7%
PORT ALmA SHIPPING TERmINAL THROuGHPuT BY INDuSTRY
PORT OF GLADSTONE THROuGHPuT BY INDuSTRY
Coal industry 71.0%
Alumina industry 23.4%
Cement industry 1.6%
Other Cargoes 1.3%
Petroleum industry 1.3%
Aluminium industry 0.8%
Grain industry 0.6%
1. A dozer works the coal on one of RGTCT’s 21 stockpiles.1
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usiness
Business | Our Trade | Gladstone Ports Corporation | Annual Report 2008–09
2816
31
1415
26
25
30
10
04
29 07
05
34
32
11
4033
12
09
08
38
41
01
39
23 02
07
05
44
21
3839
06
25
26
15
2920
403413 33
1819
08
0314
24
3642
2843
1610
30
31
1104
37
1222
09
1741 35
32 27
Unless otherwise noted all figures are for Port of Gladstone only* Port Alma Shipping Terminal only** Combined Port of Gladstone and Port Alma Shipping Terminals
01 Australia
01 Australia
Alumina 4,094,263
Aluminium 368,535
Break Bulk –Ammonium Nitrate* 82,864
Break Bulk – Fly Ash 2,496
Break Bulk – Military Equip/Vehicles 2,130
Calcite 113,778
Cement Clinker 352,955
Cement 778,941
Coal 56,385,288
Containers** 10,547
Deadburn Magnesia 46,628
Fly Ash 96,947
General Cargo** 37,156
Grain – Chick Peas 47,604
Grain – Sorghum 291,603
Grain – Wheat 107,242
Ilmenite 6,100
Limestone 44,540
Scrap Metal 22,345
Tallow* 33,498
02 Argentina
03 Bangladesh
04 Belgium
05 Brazil
06 Canada
07 Chile
08 China
09 Denmark
10 Egypt
11 France
12 Germany West
13 Hong Kong
14 India
15 Indonesia
16 Iraq
17 Italy
18 Japan
19 Korea
20 Malaysia
21 Mexico
22 Netherlands
23 New Zealand
24 Pakistan
25 Papua New Guinea
26 Philippines
27 Russia
28 Saudi Arabia
29 Singapore
30 South Africa
31 Spain
32 Sweden
33 Taiwan
34 Thailand
35 Turkey
36 United Arab Emirates
37 United Kingdom
38 USA (E Coast)
39 USA (W Coast)
40 Vietnam
41 Serbia/Montenegro
Aluminium 2,204
Bauxite 13,106,900
Break Bulk – Ammonium Nitrate* 95,832
Break Bulk – Military Equip/Vehicles 2,167
Caustic Soda 1,418,785
Containers** 10,627
General Cargo** 76,746
Gypsum 44,320
LP Gas 11,151
Liquid Ammonia 233,864
Liquid Pitch 45,528
Magnetite 74,382
Petroleum – Fuel Oil Bunkers 162,798
Petroleum – Bio Fuels* 4,059
Petroleum Coke 209,439
Petroleum Products 881,405
Scrap Metal 8,695
06 Canada
07 Chile
08 China
12 Germany West
14 India
15 Indonesia
18 Japan
19 Korea
20 Malaysia
21 Mexico
22 Netherlands
23 New Zealand
42 Oman
25 Papua New Guinea
26 Philippines
43 Qatar
27 Russia
28 Saudi Arabia
29 Singapore
32 Sweden
33 Taiwan
44 Trinidad
35 Turkey
38 USA (E Coast)
39 USA (W Coast)
IMPORT PRODUCTS (tonnes)
ExPORT PRODUCTS (tonnes)
ExPORTS By COUNTRy OF DESTINATION 2008–09
IMPORTS By COUNTRy OF ORIGIN 2008–09
32
Business
33Business | Our Trade | Gladstone Ports Corporation | Annual Report 2008–09
Looking aheadDuring 2009–10, the Port of Gladstone is forecast to handle 85.9mt of cargo, representing an increase of 6.8mt (8.5%) on 2008–09. Trade growth in 2009–10 is expected to come primarily from the coal industry, with coal exports forecast at 63.1mt compared to the 56.2mt achieved in 2008–09.
Port Alma Shipping Terminal trade is forecast to remain steady in 2009–10, at 230,000t of cargo.
We will continue to work with industry representatives and government to facilitate the development of new industry, in particular LNG, in an effort to increase and diversify trade through the Port of Gladstone.
PORT ALmA SHIPPING TERmINAL ImPORT AND EXPORT COmPARISON
2008–09
2007–08
2006–07
2005–06
2004–05
2003–04
2002–03
Fina
ncia
l yea
r
Imports
Exports
Tonnes (thousands)
28.73
21.70
79.21
90.91
60.79
36.02
110.26
126.13
46.85
64.63
47.52
106.03
132.08
117.83
PORT OF GLADSTONE ImPORT AND EXPORT COmPARISON
2008–09
2007–08
2006–07
2005–06
2004–05
2003–04
2002–03
Fina
ncia
l yea
r
10.87
11.51
13.35
15.33
16.06
16.03
16.34
43.59
48.14
49.79
51.89
58.15
60.39
62.80
Tonnes (millions)
Imports
Exports
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usiness
34 Business | Our Operations | Gladstone Ports Corporation | Annual Report 2008–09
Our
Ope
ratio
ns
RGTCT’s gross train unloading rate increased to 3,978 tonnes per hour (tph) in 2008–09 (2007–08: 3,789tph).Pictured: Trains approach RGTCT’s unloading stations.
Business
35Business | Our Operations | Gladstone Ports Corporation | Annual Report 2008–09
Outcomes 2008–09Completed Reliability Centred maintenance process for RGTCT and BPCT expansion assets
Achieved average gross shiploading rate of 2,953tph at RGTCT and 1,578tph at BPCT
Completed structural refurbishment of RGTCT’s Shiploader 1
Completed major refurbishment of RGTCT’s conveyor reclaim tunnels
Constructed and commissioned new sterilisation facility for treatment of quarantined waste from ships
Targets 2009–10Conduct major maintenance and structural refurbishment of Shiploader 2 and three stockpile reclaim tunnels
Commence implementation of Water Recovery and Recycling Strategy
Implement medium-term dust mitigation strategies from 2006–07 Dust Benchmarking Study recommendations
Implement Continuous Improvement Plan across RGTCT and BPCT
Reduce train unloading and shiploading delays at RGTCT and BPCT to <20%
Complete feasibility, scope and design for additional stockpile and associated infrastructure at RGTCT
undertake review of Auckland Point 1 wharf facility and its operating strategy
Our wharf facilitiesThe Port of Gladstone comprises 6 wharf centres:
1. Barney Point Coal Terminal (BPCT) (GPC-owned and operated)
2. RG Tanna Coal Terminal (RGTCT) (GPC-owned and operated)
3. Auckland Point wharves (GPC-owned and operated)
4. Boyne Wharf (GPC-owned and operated by Boyne Smelter)
5. South Trees wharves (owned and operated by Queensland Alumina Limited)
6. Fisherman’s Landing (GPC–owned but operated by multiple companies).
Port Alma Shipping Terminal is GPC-owned and operated.
Accommodating some of the world’s largest vesselsThe Port of Gladstone can accommodate vessels up to 220,000 dead weight tonnes (DWT), whereas Port Alma Shipping Terminal, due to its location, is restricted to accommodating vessels under 180 metres in length.
The number of cargo handling vessels that visited the Port of Gladstone totalled 1,396 (2007–08: 1362), while 96 (2007–08: 61) visited Port Alma Shipping Terminal.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usiness
36 Business | Our Operations | Gladstone Ports Corporation | Annual Report 2008–09
Our
Ope
ratio
ns c
ont..
. Engineering worksThroughout the year we reviewed our operations and identified a number of projects to include in our works schedule for 2009–10 that would deliver further operational efficiency and environmentally responsible processes. Our Engineering Works Program for 2009–10 will include the installation of wind barriers to reduce dust emissions, and additional infrastructure to facilitate water recycling systems and address coal spillage from our wharf facilities. See Our Environment (page 56) for more information.
Optimising asset performanceHaving expanded our capacity and related assets over recent years, our operating focus through 2008–09 was on optimising operational and asset performance. This work will continue through 2009–10 building on the solid foundation established to date.
maintaining operational reliabilityReliability Centred maintenance (RCm) was focused towards improving plant availability and reliability during the year. The elimination of reoccurring plant issues continued to be a priority and delivered a noticeable improvement in equipment reliability. We persistently strive to improve asset performance and continue to develop asset life plans, using the RCm principles established over recent years, to ensure our goals are met.
In 2008–09 we further developed our spares and rotating spares management processes within our Centralised maintenance management System (CmmS), ensuring the availability of critical plant spares and the optimisation of inventory holdings. The evolution
Delivering on expectationsWe are committed to delivering on stakeholder expectations, meeting our customers’ requirements to ensure the sustainability of our operations. Throughout 2008–09 our focus was on improving operational efficiency; further reducing the risks inherent in our operation; and delivering environmental improvement initiatives.
The coordination of projects and initiatives in these areas will continue through 2009–10 and will rely on the cooperation and planning across our stakeholder groups.
OutagesPlanned maintenance shutdowns of our operations are essential to ensure that we continue to meet the performance expectations of our stakeholders. Shutdowns across RGTCT and BPCT were completed in 2008–09, in line with commitments and schedules developed in consultation with our customers and rail operator.
Shutdowns at RGTCT allowed for major maintenance activities, including shiploader life extensions and a major refurbishment of reclaim tunnel conveyors to ensure efficient shiploading rates are maintained. At BPCT, shutdowns enabled major maintenance and the completion of long-term structural refurbishment works to the yard stacker, improving the terminal’s stockpiling capacity.
During the year we worked with our stakeholders to develop outage schedules for 2009–10 to ensure minimal impact on trade through the Port of Gladstone. These outages will facilitate further major maintenance and improvement project activities.
Business
37Business | Our Operations | Gladstone Ports Corporation | Annual Report 2008–09
Providing optimum unloading and loading ratesRGTCT’s gross train unloading rate increased to 3,978 tonnes per hour (tph) in 2008–09 (2007–08: 3,789tph). Further commissioning of RGTCT’s third shiploader contributed to an overall increase in gross shiploading rates across all three shiploaders, to a rate of 2,953tph (2007–08: 2,791tph).
unloading delays at BPCT were reduced from 12% (2007–08) to 5.2% in 2008–09, achieving an average unload rate of 1,970 (2007–08 1,842tph). Shiploading rates also realised an improvement, increasing from 1,447tph (2007–08) to 1,578tph (2008–09).
key Performance Indicators (kPIs) for train unloading delays at both RGTCT and BPCT were achieved in 2008–09 realising 12% against a target of 15%. Expansion commissioning influences affected the shiploading delay performance by 23%, but there was a significant improvement on 2007–08 (29%) compared to the 20% target.
We continue to work closely with Queensland Rail Limited (QR) and our supplying coal mines through our Capricornia Coal Chain maximisation Project, a joint initiative focused on improving efficiencies across the coal transport chain.
Looking aheadWith the assistance of our coal exporting partners, we will maintain the emphasis on continuous improvement throughout the year ahead and will review operational practices, levels of service, efficiencies, cost structures, and coal loading facilities at both RGTCT and BPCT.
Asset life plans using RCm principles will be completed during 2009–10, with a view to developing a mature long–range major maintenance cost forecast.
2009–10 will also see the implementation of medium-term dust mitigation strategies across our coal operations, incorporating the 2006–07 Dust Benchmarking Study recommendations.
1
of our work management system will continue to be a focus in 2009–10, with emphasis on task planning and scheduling, performance measurement and reporting. This will ensure we improve our maintenance of assets throughout their life cycle.
mobile fleetIn alignment with our dozer fleet replacement strategy, two new CAT D11 dozers were ordered during 2008–09. These new machines, to arrive in early 2009–10, will deliver a lower maintenance cost, through extended service periods, and a substantially lower fuel usage. These savings will be further enhanced by the completion of, and migration to, the new mobile equipment maintenance facility in July 2009.
1. Production employee in Unloading Pit, John Shore assists with the train unloading of coal in RGTCT’s unloading stations.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usiness
38 Business | Our Port Security | Gladstone Ports Corporation | Annual Report 2008–09
Outcomes 2008–09Issued new identification cards to GPC employees, contractors, port users and government agency personnel
Developed and implemented internal audit plan for ports’ maritime security plans
Reviewed cyclone procedures and on-site emergency response procedures
Targets 2009–10Review and update ports’ maritime security plans
Continue implementation of internal audit plan
Conduct exercises to assess ports’ maritime security plans and Incident Management System
Complete upgrade of site access controls
Our
Por
t Sec
urity
Maintaining a whole of port approach to securityWe continue to work closely with other maritime industry participants to maintain a whole of port approach to security.
Port security committees, for both Port of Gladstone and Port Alma Shipping Terminal comprise GPC Security employees, port users and government agencies. The committees meet on a quarterly basis to share information about general security issues and new initiatives.
During 2008–09 we commenced roll-out of our new access control system. This involved issuing around 3,300 new identification cards to employees, contractors and port users. As part of this process all non-GPC employees were required to attend a site re-induction to ensure that they were fully aware of security and safety requirements at our sites. We inducted approximately 2,700 people during the year.
We issue Maritime Security Identification Cards (MSIC) as an agent for the Port of Brisbane – in 2008–09, 398 cards were processed and issued. MSIC cards provide the cardholder with access to maritime security zones relevant to their work requirements.
During the year, our Security employees participated in a number of exercises designed to address aspects of the maritime security system. These included:
• October2008:weparticipatedinMercury 08, a National Counter Terrorism Committee exercise. The exercise, conducted over five days, included scenarios associated with ships in and around Gladstone Harbour.
• February2009:AustralianCustoms conducted incident management exercises in Gladstone. Our Security team participated in the exercise to ensure that it aligned with our incident management processes.
• February2009:weparticipated in a maritime security exercise on the vessel MV Stadacona while it wasberthedatFisherman’sLanding No. 4. This exercise allowed our security team to test critical port-to-ship security procedures.
Business
39Business | Our Port Security | Gladstone Ports Corporation | Annual Report 2008–09
1. A vessel berthed at RGTCT.
2. RGTCT’s stockpile area.
12
These exercises provide us with an opportunity to test our response capabilities, communications, incident management, and (within the context of the exercise) our ability to work with emergency services and other government agencies.
Looking aheadIn 2009–10, we will complete the upgrade of our access control system at RGTCT and its wharf facility.
We will review and update the Port of Gladstone and Port Alma Shipping Terminal security risk assessment and maritime Security Plans (mSPs). A Business Continuity Plan will also be developed to ensure we continue to meet legislative requirements.
upgrading our security systemThe Department of Infrastructure, Transport, Regional Development and Local Government undertakes annual audits of our security system to ensure that we meet legislative requirements. This year’s audit, conducted in October 2008, identified a number of minor issues, most of which have now been addressed. On an ongoing basis, we must ensure all security contractors fulfil their responsibilities, and water-side
and land-side restriction zones are appropriately delineated. We will also develop a Business Continuity Plan in 2009–10 as part of our commitment to meeting all legislative requirements.
These issues have been added to our security Continuous Improvement Plan and will be implemented throughout 2009–10.
We reviewed our cyclone procedures and on-site emergency response procedures in early 2009. The review did not identify any significant issues.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureB
usiness
Further dredging is expected to continue at Fisherman’s Landing throughout 2009–10, in preparation for the construction of infrastructure associated with Gladstone’s future industry.Pictured: Port of Gladstone with Fisherman’s Landing in foreground.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
Infrastructure | Gladstone Ports Corporation | Annual Report 2008–09 41
Infrastructure
Infra
stru
ctur
e
Infrastructure 41
Our Projects 42
42 Infrastructure | Our Projects | Gladstone Ports Corporation | Annual Report 2008–09
Our
Pro
ject
s
Xstrata Coal commenced pre-feasibility studies and geotechnical works for the development of a coal export facility at Port Alma Shipping Terminal (pictured) during the year.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureInfrastructure
43
Infrastructure
Infrastructure | Our Projects | Gladstone Ports Corporation | Annual Report 2008–09
Outcomes 2008–09Completed construction of new administration precinct at RGTCT
Completed construction of dozer crossing and dozer maintenance facility at RGTCT
Completed Full Feasibility Study for proposed Wiggins Island Coal Terminal in October 2008
Completed Stage 1 of dredging works for Berth 1 at Fisherman’s Landing
Completed master Planning Report for the Western Basin Development
Submitted EIS for Northern Reclamation Project at Fisherman’s Landing
Commenced EIS approvals process for the Western Basin Dredging and Disposal Project for proposed LNG developments
upgraded Port Shipping Capacity model to include proposed LNG projects and LNG shipping protocols
Targets 2009–10Complete construction of RGTCT refuelling facility and car wash
Complete Detailed Design phase for proposed Wiggins Island Coal Terminal
Complete dredging works for Berth 1 at Fisherman’s Landing
Complete EIS approvals process for Northern Reclamation Project at Fisherman’s Landing
Commence construction works on perimeter bunds at Fisherman’s Landing
Complete EIS approvals process for Western Basin Dredging and Disposal Project
Commence detailed investigations associated with EIS for future Harbour Channel Duplication
RG Tanna Coal Terminal (RGTCT)Since the completion of the RGTCT Expansion Project in late 2007, our focus has centred on the optimisation of the facility through a three-year Continuous Improvement Program (CIP) and the Capricorn Coal maximisation Project. This project, involving Queensland Rail Limited (QR) and our coal mines, aims to improve coal supply logistics. During the year we also completed the Feasibility Study for the upgrade of the terminal’s control system. Preliminary works have commenced for the upgrade, to be carried out in five distinct phases over five years. See pages 34–37 for more information.
A dozer crossing and associated road works, completed in march 2009, provided the terminal’s 23 CAT D11 dozers with easier access to stockpiles and maintenance stations. The infrastructure also minimises transportation restrictions throughout the terminal and enhances the safety of employees travelling in light vehicles on site.
In July 2009, a mobile equipment maintenance facility that provides a service facility for the dozers was completed. The dozer shed, featuring the latest technology, houses the 15 service-crew members and a full time Caterpillar representative to ensure minimum down time of the dozers. The facility enables 6 dozers to be worked on concurrently.
44 Infrastructure | Our Projects | Gladstone Ports Corporation | Annual Report 2008–09
Our
Pro
ject
s co
nt...
A new administration precinct, that now houses many of our Corporate Relations employees, was completed in November 2008. This included an office building; security entrance; amenities block and crib room; and adjacent undercover car park as part of the Expansion Project’s non-operational works program.
Our maintenance, Operations and Environment teams continue to identify and undertake initiatives to improve the terminal’s operations against environmental legislation. As part of our Environmental Improvements Program, infrastructure, to address recommendations from the 2006–07 RGTCT Benchmarking Study, continues to be implemented throughout the site. See page 56 for more information.
RGTCT future developmentsIn 2009–10, we will finalise a number of operational and non-operational facilities at RGTCT such as the relocated car wash and re-fuelling facility.
Continued emphasis will remain on improving the efficiency of our logistics and operational systems through the CIP and Capricorn Coal Chain maximisation Project.
Stage one of the control system upgrade will be undertaken in an effort to improve the reliability and efficiency of the terminal’s operations.
We will also continue to implement infrastructure associated with our Environmental Improvements Program across the terminal.
Port Central (Auckland Point Wharves and Barney Point Coal Terminal)No major infrastructure works were undertaken at Port Central in 2008–09. However, routine maintenance and improvement projects continued to ensure unloading and shiploading efficiency at all facilities.
various environmental initiatives continued to be implemented at our Auckland Point facility and Barney Point Coal Terminal (BPCT) as part of our Environmental Improvements Program. These initiatives included the installation of water sprays on conveyors to reduce dust generation during stockpiling and shiploading.
Port Central future developmentsIn the coming year we will continue to focus on the implementation of environmental initiatives at BPCT, in particular the initiatives from the terminal’s 2006–07 Benchmarking Study recommendations.
“ Continued emphasis will remain on improving the efficiency of our logistics and operational systems.”
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
Infrastructure | Our Projects | Gladstone Ports Corporation | Annual Report 2008–09 45
Infrastructure
21
Wiggins IslandThe Full Feasibility Study for the proposed Wiggins Island Coal Terminal, which commenced in march 2008, was completed in October 2008. A further Supplementary Feasibility Study was completed in December 2008. This study considered alternative models of construction and procurement that resulted from the Initial Feasibility Study.
The Detailed Design phase, commenced in June 2008, is approximately 57% complete and is scheduled for completion in 2009–10. The state government is currently in negotiations with the preferred proponents to achieve financial close for the project. This will provide a funding source for project construction. Due to these ongoing negotiations and the effects of the global economic crisis, the commencement date for construction is now expected to be in the latter half of 2010.
Port Alma Shipping TerminalDuring the year, Xstrata Coal commenced a Pre-feasibility Study for the development of a coal-exporting terminal at Port Alma Shipping Terminal, with pre-feasibility related investigations including geotechnical works currently occurring on site. It is anticipated that this phase will be completed in late 2009 to early 2010. Xstrata is currently seeking to have the project declared a Significant Project by the Coordinator General.
1. Wiggins Island Coal Terminal (site in foreground), once commissioned, and RGTCT will provide the necessary infrastructure to handle in excess of 140 million tonnes of coal per annum.
2. Port Alma Shipping Terminal.
46 Infrastructure | Our Projects | Gladstone Ports Corporation | Annual Report 2008–09
Fisherman’s LandingThe proposed 153 hectares (ha) Northern Reclamation Project advanced to the next phase of development with the submission of an Environmental Impact Statement (EIS) during the year. This reclamation project will provide 6 additional wharf sites to cater for future industrial developments within the Gladstone State Development Area (GSDA). Construction of the perimeter bund is scheduled to commence during 2009–10.
Proposed Liquefied Natural Gas (LNG) developments, within the Western Basin area of the Gladstone harbour, will require extensive dredging. To cater for the disposal of dredge material, further reclamation will be required in the Fisherman’s Landing area. The EIS process for dredging and disposal within the Western Basin commenced during the year. To meet the LNG Industry’s project timeframe, approval of the EIS and Environment Protection and Biodiversity and Conservation Act 1999 (EPBC) is required during 2009–10.
Stage 2 dredging works, covering the swing basin for the Berth 1 development of the Rio Tinto Alcan (RTA) Yarwun 2 expansion, commenced during the year. We expect dredging works to be completed by September 2009.
The first shipment of caustic product for Orica’s new Caustic Import Storage Facility at Fisherman’s Landing was unloaded at the Bulk Liquids Berth (FL5) during 2008–09.
Fisherman’s Landing future developmentsOngoing investigation and planning for the provision of necessary port infrastructure to cater for future industrial growth in the Yarwun and Aldoga State Development areas will continue during 2009–10.
Curtis IslandCurtis Island has become a major hub for proposed developments associated with the export of LNG sourced from coal seam methane gas deposits in the Surat Basin. To cater for the development of the LNG industry, the state government expanded the GSDA to include an area of land on Curtis Island.
Our Senior management have been working closely with government and LNG proponents to ensure that the necessary infrastructure is in place to meet their project requirements. This work has included the development of infrastructure and protocols that will ensure the safe operation of LNG vessels within the Port of Gladstone.
We have also been working with LNG proponents to devise logistics centres to be located at Port Central and on Curtis Island. The centres will cater for the movement of people and cargo between the mainland and the island.
Our
Pro
ject
s co
nt...
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
Infrastructure | Our Projects | Gladstone Ports Corporation | Annual Report 2008–09 47
Infrastructure
Looking aheadWe will continue to play an integral role in planning infrastructure to cater for the ports’ future development, better positioning us to accommodate the continuing growth of Central Queensland industries in a sustainable manner.
1. Fisherman’s Landing.
2. Fisherman’s Landing (foreground) and Curtis Island (background) will house Gladstone’s proposed Liquefied Natural Gas plants.
1
2
General port growthDuring the year there was a major increase in the level of interest in the Port of Gladstone as a preferred location for the development of major LNG export facilities. Based on the current LNG project proposals, it is estimated that the total LNG export capacity through the Port of Gladstone could exceed 40mtpa.
The potential growth associated with the LNG industry has added an increased focus on the development of the Western Basin area of the port.
A master Planning process was initiated by the Department of Infrastructure to provide a greater level of understanding of the planning and coordinating involved with the provision of infrastructure for the Western Basin area. The process will also assist us in streamlining the environmental approvals processes through all levels of government.
To cater for the future growth in vessel traffic within the port, investigative work continued on a detailed strategy and financial model for the ongoing development of the outer harbour channels. This work will ensure that approvals and funding are in place to deliver the necessary infrastructure for the future development of the Port of Gladstone and associated increased shipping capacity.
In conjunction with this, we completed the upgrade of the Port Shipping Capacity model. This will provide better predictive information on shipping capacity against the projected growth in port trade based on potential scenarios for industrial development.
Investigative works associated with the preparation of an EIS for the future development of the main harbour channels will commence during 2009–10.
A little black cormorant rests upon the rocks surrounding Spinnaker Park, adjacent to Gladstone Port Central.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
Environment | Gladstone Ports Corporation | Annual Report 2008–09 49
Envi
ronm
ent
Environm
ent
Environment 49
Our Environmental management 50
Energy and Greenhouse Gases 59
Environment | Our Environmental management | Gladstone Ports Corporation | Annual Report 2008–0950
Our
Env
ironm
enta
l man
agem
ent
We work hard to ensure our operations do not negatively impact on our environment and conduct a range of monitoring programs, studying the actual or potential impact of our operational activities on the environment.Pictured: Water from a settlement pond adjacent to RGTCT is sampled for testing.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
Environment | Our Environmental management | Gladstone Ports Corporation | Annual Report 2008–09 51
Outcomes 2008–09Re-certified our Environmental management System to ISO 14001:2004
Continued implementation of Energy Efficiency Opportunities program
Developed and commenced implementation of Environmental Improvements Program, including recommendations from RGTCT and BPCT benchmarking studies
Received 37 community complaints
Targets 2009–10maintain the ISO14001:2004 environmental management system
Progress EIS for both Western Basin Dredging and Shipping Channel Duplication projects
Fulfil all reporting requirements for Energy Efficiencies Opportunities Act 2006, National Greenhouse Gas and Energy Reporting Act 2007, and National Pollutant Inventory
Continue progressively implementing the Environmental Improvements Program, including the recommendations from the RGTCT and BPCT benchmarking studies
Fostering a concerted approach to environmental managementOur Environmental Policy supports a commitment to operate in a manner that allows for sustainable development while minimising environmental harm to the port and surrounding areas. To achieve this we are committed to:
• ongoingimprovementsinour operations to minimise environmental impacts
• improvingthelevelofenvironmental awareness and understanding of our employees and the wider community
• establishingenvironmentalstrategies in association with external stakeholders.
Our Environmental Policy is communicated to employees through a number of training initiatives, toolbox meetings, information sessions, our intranet, and specific work procedures. Port users and contractors are also required to familiarise themselves with our Environmental Policy to ensure their work practices align with ours.
The policy statement is also available on our website – www.gpcl.com.au.
Striving for continuous improvementOur Environmental management System (EmS) meets the international specification for environmental management ISO 14001:2004. We use the EmS to improve our environmental management and performance by understanding environmental risks, incidents, complaints and changes in legislation. The EmS is also a management tool used to minimise and/or control any environmental harm that may be associated with activities we conduct across our sites.
An external certifier conducts six-monthly surveillance audits and three-yearly re-certification audits of the EmS against ISO 14001:2004. Our 2009 three-year recertification audit resulted in us being re-certified for another three-year period. Retaining this certification and demonstrating continuous improvement into the future is a challenge that we are committed to meeting.
Environment | Our Environmental management | Gladstone Ports Corporation | Annual Report 2008–0952
Our
Env
ironm
enta
l man
agem
ent c
ont..
.
• calibrationofequipmentmeasuringthedustextinctionmoistureofincomingcoal. During 2008, we installed moisture-monitoring equipment at both RGTCT and BPCT to improve the management of rogue dust. Significant effort has gone into gathering information about the characteristics of the various coal types received at our coal terminals in order to manage dust in a proactive way.
Ensuring environmental complianceThroughout 2008–09, we worked to implement the requirements of new development approvals for Barney Point Coal Terminal (BPCT), and RG Tanna Coal Terminal (RGTCT). To this end, we have committed to more stringent environmental performance standards and an overall objective of continued improvement in environmental management, operating beyond compliance requirements and expectations.
During 2008–09 we sought and received from the Department of Environment and Resource management (DERm) a series of Transitional Environmental Programs (TEPs). These provide a short period in which to make the environmental improvements necessary to meet the new development approvals conditions.
These TEP’s addressed the following issues:
• theimplementationofrealtimeairqualitymonitoringatRGTCTandBPCT. The new development approvals require us to monitor dust emissions on a continuous and real-time basis. This enables terminal operators to respond immediately and control any situation that increases the chance of off-site dust emission
• stormwatermanagement. Another key feature of the BPCT and RGTCT development approvals is the requirement for automatic water discharge monitors. These allow us to actively manage the quality of water leaving operational sites. This TEP also covered the installation of improved stormwater management infrastructure at BPCT
1. A water truck sprays BPCT’s coal stockpiles as part of our approach to reducing coal dust from the terminal.
1
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
Environment | Our Environmental management | Gladstone Ports Corporation | Annual Report 2008–09 53
monitoring our environmentWe conduct a range of monitoring programs to study the real and potential environmental impacts of our operations.
Air qualityThrough air quality monitoring and community feedback, we implemented a number of improvements during 2008–09.
We now have 12 real-time monitors (RTms) strategically located around RGTCT, BPCT and in community locations. Information from these monitors is relayed every two minutes, allowing us to assess and control the impact of dust on the community and ensure our compliance with development approval conditions.
Complementing this data is the information we receive from our two weather stations situated close to RGTCT and BPCT.
In 2008–09, we developed software that displays results from our weather stations and initiates alarms in our RGTCT and BPCT control rooms. Alarms occur with extreme wind conditions, enabling control room operators to control potential coal dust generation through various sprinkler systems located around our stockpiles. A link to this data is available on our website, 24-hours-a-day, seven-days-a-week.
Since 2000, we have maintained a network of dust depositional gauges (DDG) in and around our operations and in the community. The gauges measure the total quantity of dust settling in monitored areas. Further analyses allows us to determine the proportion of coal dust, mineral dust, and plant and insect material. This monitoring provides a good indication of how successful our coal terminals are in reducing coal dust emissions.
Results at community sites exceeded action levels on 6 occasions during 2008–09, an improvement from the previous year’s 9 breaches. Further analysis showed three of these breaches were due to dust other than coal dust.
The other three samples indicated the presence of coal dust at levels ranging from 1.5 grams per square metre per month (g/m2/month) to 2.8 g/m2/month. In each case the source of the coal dust was identified and remedial action was taken. See page 58 for more information.
Water qualityAutomated water quality analysers operate at RGTCT and Boyne Smelter wharf. These monitor dissolved oxygen, pH, temperature, electrical conductivity and turbidity. Data gathered from these monitors is available on a real-time basis. Results from the analysers during 2008–09 were within standard guidelines for general marine waters.
We installed real-time (stormwater) monitors at our stormwater discharge points during the year. These allow us to remotely monitor information about water levels in our stormwater retention ponds. No storm activity occurred on site following the installation, therefore results have not yet been recorded.
Automated samplers were installed at several of these retention ponds. The samplers collect stormwater samples for laboratory analysis to determine the water quality characteristics. No storm activity occurred on site following the installation, therefore results have not yet been recorded.
In conjunction with BioSecurity Queensland, we conduct a routine marine pest (non threatening endemic species) monitoring program. To date, sampling in Gladstone harbour waters has not identified the presence of any marine pests.
Environment | Our Environmental management | Gladstone Ports Corporation | Annual Report 2008–0954
Our
Env
ironm
enta
l man
agem
ent c
ont..
. Flatback turtlesOver the past decade we have contributed to the Queensland Parks and Wildlife Service’s Flatback Turtle monitoring initiative. The southern end of Curtis Island is home to a medium density nesting population of the Flatback Turtle (Natator depressus), a turtle found only in Australian waters. The rookery has been monitored intermittently since 1970.
mid-season monitoring is conducted nightly during November and December each year. During this period the beach is monitored for at least two hours before high tide and for approximately four hours after.
All turtles found are tagged (or checked for tagging), and measured and nests are tagged to identify their location.
Port Curtis Integrated monitoring ProgramThe Port Curtis Integrated monitoring Program (PCImP) is a collaborative monitoring program involving 15 organisations undertaking activities around Gladstone Harbour. Our participation and ongoing financial support of this program reflects our commitment to ensuring a sustainable aquatic environment in Port Curtis. The information gained will prove invaluable as state and federal governments roll out new policies requiring environmental offsets for development.
Our involvement with this unique program focuses on seagrass, bio-monitoring and intertidal monitoring.
SeagrassLong-term seagrass monitoring programs in Queensland have indicated that healthy and productive seagrass habitats can co-exist with appropriately managed port facilities.
Seagrass meadows within the Gladstone harbour are an important and sensitive component of the Port of Gladstone marine habitat. The information gained from the monitoring program has enabled us to make informed decisions about the planning and development of port infrastructure, ensuring that it will have a minimal impact on the fisheries and the marine environment within the port.
A further seagrass monitoring survey, conducted in 2008–09, indicated that seagrasses in Port Curtis were in a relatively healthy condition compared with previous surveys. most of the monitored meadows showed only slight changes in density and area since last year. However, it was noted that the intertidal and sub-tidal meadows in the Fisherman’s Landing area and the Quoin Island meadow had experienced significant declines in biomass. Changes in seagrass condition in Port Curtis appear to be largely caused by local climate conditions. The high rainfall and associated high sediment run-off into the harbour that occurred in early 2008 appear to have had an adverse effect on the seagrass meadows near the mouth of the Calliope River.
Seagrass meadows and dugong are present in intertidal areas adjacent to our port facilities and infrastructure, indicating that these habitats can co-exist with well-managed port activities and development.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
Environment | Our Environmental management | Gladstone Ports Corporation | Annual Report 2008–09 55
Bio-monitoring and Intertidal monitoringBio-monitoring and intertidal monitoring of the Port Curtis aquatic ecosystem health was undertaken in 2008–09.
The bio-monitoring program measured a range of physical conditions in the Gladstone harbour as well as nutrient and metal concentrations using DGT (Diffusive Gradient in Thin-Film) equipment and transplanted oysters.
The intertidal monitoring program measured changes in a range of parameters considered indicative of the health of the ecosystem, including physical characteristics and contaminant concentrations of sediment, aspects of mangrove condition (species diversity, tree and density, protective foliage cover, seedling biomass and density), and crab-hole density.
The PCImP released its first Ecosystem Health Report Card in 2008. This card provided a health rating (ranging from A+ to F) for each of the nine harbour zones. Overall Port Curtis’ ecosystem was deemed healthy, with a B+ the lowest rating of any zone, indicating only a small difference to reference conditions. The full report is available from the PCImP website www.pcimp.com.au
We are currently considering proposals to undertake additional monitoring programs that will further develop our understanding of the health of Port Curtis.
Oil spillIn January 2006, the Gladstone harbour experienced the worst oil spill in its history. Now more than three years on, research results show that the waterways, mangrove ecosystems and marine environments have returned to good health. The most recent PCImP report showed that the majority of oil-affected areas have almost recovered to their pre-spill condition.
Environmental improvements programRGTCT and BPCT benchmarking studyIn 2006–07, in response to community concerns about dust levels in the region, we engaged consultants to undertake a study to assess the environmental performance of RGTCT and BPCT.
The consultants produced a report that identified measures required to ensure that dust management practices at RGTCT and BPCT were as effective as those at other major terminals. These were broken into short, medium and long-term strategies. On 2 April 2008, our Board announced support for the implementation of the recommended short and medium-term strategies.
1. Environmental Advisor, Clancie Webster assists the Environment team with the development of environmental initiatives, monitoring, and reporting.
2. During 2008–09 we continued to make environmental improvements across our coal terminals to reduce dust generation – pictured is RGTCT.
1
2
Environment | Our Environmental management | Gladstone Ports Corporation | Annual Report 2008–0956
Our
Env
ironm
enta
l man
agem
ent c
ont..
. Over the past year we have made significant progress in implementing these recommendations.
Tasks completed at BPCT as at 30 June 2009:• adedicatedwatertruck
provided to spray stockpiles and roadways and apply sealing veneer on stockpiles in high wind events
• waterspraysfittedtotransfer points on all train unloading conveyors
• dustextinctionmoistureanalysers installed at dump station
• spillageareascleaneddaily by dedicated clean up crews
• thefirststageofmistingspraysinstalled along windward side of stockpiles
• vehiclemovementsoverstockpiles minimised
• vacuumtruckprovidedto regularly clean inaccessible areas
• railloopcleanedonaregular basis
• conceptdesigndevelopedfor wind barriers on wharf conveyors
• engineeringdesignof15metre wind barrier at BPCT developed
• spraysystemmodifiedtoinclude a recycled water component for vehicle routes
• trialoflinkingreal-timedustmonitoring data to control rooms commenced. The full system is scheduled for commissioning in 2009–10
• preliminaryengineeringdesignof a wagon wheel washing station developed.
Work in progress:• commissioningofpermanent
link between real-time dust monitors and the control room, and associated operator training
• calibrationoftotalmoistureanalysers to specific coal types.
Tasks completed at RGTCT as at 30 June 2009:• 163bulkwatersprays
installed to dampen stockpile surfaces
• adedicatedwatertruckprovided to spray open stockpiles and roadways
• designconceptforconveyorwind shielding developed
• sweepertrucksandvacuumtrucks used daily to clean roadway and spills
• spillageareasclearedbydedicated clean up crews
• treesplantedonbundwalloneastern boundary to provide natural barrier
• low-dust,washedcoalsstockpiled near sensitive areas
• structuralanalysisassessingthe feasibility of installing gantry misting sprays completed
• engineeringdesignforelevated wind guards at RGTCT developed
• engineering,operationsandmaintenance of wharf dust sources reviewed.
Work in progress:• constructionofanewdozer
crossing to reduce dozer generated dust
• constructionofnewmisting sprays
• purchaseofasuctiontruckto further improve on-site clean up capability and response time
• fullengineeringreviewassessing the feasibility of options for automated addition of water to coal
• calibrationoftotalmoistureanalysers to specific coal types.
REAL TImE AIR QuALITY mONITORING SITES
Operational
Community sites
Weather stations are located at sites 4 and 9
01
02
03
04
07
08
09
05
12
06
11
10
Gladstone queenslandGladstone
queensland
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
Environment | Our Environmental management | Gladstone Ports Corporation | Annual Report 2008–09 57
modifications at Auckland Point TerminalOver the last year, improvements made to the existing magnesia handling systems at Auckland Point Berth No. 1, reduced impacts on the community from the loading of magnesia.
Tasks completed at Auckland Point Terminal as at 30 June 2009:• mistingsprayswereinstalled
on the conveyor to shiploader at Auckland Point wharves
• livefeedofreal-timeairmonitoring information to shiploader operators at Auckland Point Terminal.
Work in progress:• installationofadditional
misting sprays for the shiploader transfer point and boom
• preventativemaintenanceand modifications to address dust leakage from the shiploading system.
Engaging our communityInitiating open communicationThis year we continued to promote our Community Working Group. The Group’s aim is to enhance the collaboration between the Port of Gladstone and the community on matters relating to port operations, development and environmental management.
The Group comprises 13 members, including an independent chairperson, with representatives from the community, GPC, government and relevant interest groups. The Group meets at least quarterly to share information on port activities and feedback from the community and met five times in 2008–09.
Collaborating to improve Gladstone’s air qualityThroughout the year we continued to support the Queensland government’s Clean and Healthy Air for Gladstone Project. The two-year project, conducted by the Department of Environment and Resource management and Queensland Health, is working in consultation with the community and industry to create a healthier environment for Gladstone residents.
We have been encouraged by the findings of the health risk assessment completed this year and the initial results from the extensive air-quality monitoring program. Further information is available on the Department of Environment and Resource management website: www.epa.qld.gov.au.
We also continued to support Queensland Rail Limited to develop dust management plans that would address dust generation from coal trains.
Environment | Our Environmental management | Gladstone Ports Corporation | Annual Report 2008–0958
Looking aheadIn 2009–10 we will maintain our focus on continuous improvement by maintaining certification of our Environmental management System to ISO 14001:2004.
We will continue the implementation of the GPC-wide ‘Energy and Greenhouse Declaration of Commitment’, supported by individual policies, to manage risks associated with climate change. This includes annual public reporting of energy efficiency performance to external stakeholders.
Our Environmental Improvements Program will also continue, implementing the short and medium-term improvement actions recommended in the RGTCT and BPCT Benchmarking Studies.
We will work to progress EIS processes for the Western Basin Dredging Project and disposal of dredge material for the LNG industry to ensure potential environmental impacts are minimised.
Our
Env
ironm
enta
l man
agem
ent c
ont..
. COmmuNITY COmPLAINTS
Coal dust 11
Dust misc 9
Noise 9
Other 8
Responding to community concernsWe received 37 complaints in 2008–09 (2007–08: 26). Of these complaints, 20 were related to dust (2007–08: 19) and 11 related specifically to coal dust (2007–08: 15). Of the remaining complaints, nine related to noise (2007–08: 7), 6 were associated with concerns about coal being washed from ships as they left the harbour, one was associated with the visual amenity of lighting, and one was with regard to general environmental issues.
Our Environment team investigated and reported on all complaints and ensured appropriate key personnel were advised to implement remedial actions where appropriate.
Informing our stakeholdersWe engage in a number of initiatives to inform the community and other stakeholders of our environmental policy and best practice management.
Our community newsletter Port Talk communicates news and progress relating to our environmental initiatives. The newsletter is distributed to 16,000 residents in the Gladstone, Calliope and Boyne/Tannum regions.
We also keep the local community informed about various environmental initiatives, including highlights from our Community Working Group meetings, through media releases and advertisements in local newspapers. See page 64 for more information.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
Environment | Energy and Greenhouse Gases | Gladstone Ports Corporation | Annual Report 2008–09 59
Energy and greenhouse gasesEnergy Efficiency Opportunities scheme (EEO) and National Greenhouse Emissions Reporting Scheme (NGERS)We became a signatory to the federal government’s Energy Efficiency Opportunities initiative in 2006–07. This program seeks to improve the identification and uptake of energy efficient opportunities by industry and in doing so reduce greenhouse gas emissions. We released our first public report on our EEO program in October 2008. Both the 2008 and 2009 public reports are available via our website www.gpcl.com.au.
much of our initial activity in this area has been focussed on improving the way in which we measure our energy consumption so that opportunities for improvement can be identified. However, some significant improvements have been recorded already through purchasing more fuel efficient equipment. Our newest CAT D11 dozer has proven to be 7.16% more efficient than older models. This means it burns 35,840 litres less fuel, saving 1.4 terra (1012) joules each year (the equivalent of 28 households), and reduced greenhouse gas emissions by 96.7t each year.
We are also a mandatory participant under the National Greenhouse Gas and Energy Reporting Act 2007. The first reporting deadline under this legislation is 31 October 2009. The results will be published on our website following the submission of the report.
National Pollution InventoryEach year we submit information on our emissions for inclusion in the National Pollutant Inventory (NPI). The NPI shows emission estimates and the source and location of these emissions. It is a cooperative program implemented by the Australian, State and Territory governments. Our report is due on 30 September each year. Our program has been aligned internally with Energy Efficiency and National Greenhouse and Energy reporting requirements to ensure a collective approach to prioritising emission reduction strategies.
ENERGY TYPES AND SOuRCES FOR 2008
Automotive diesel oil (diesel) 59.5%
Electricity 38.8%
unleaded petrol, LPG and acetylene gas 1.7%
Equivalent to:
– 727,040,183 mJ energy
– 14,541 Households of energy
– 102,299 tonnes CO2
Ene
rgy
and
Gre
enho
use
Gas
es
Gladstone’s Marina parklands provide the ideal location for family activities.Pictured: A youngster feeds the seagulls on the marina’s boardwalk.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
Community | Gladstone Ports Corporation | Annual Report 2008–09 61
Com
mun
ity
Community 61
Our Community Involvement 62
Community | Our Community Involvement | Gladstone Ports Corporation | Annual Report 2008–0962
Our
Com
mun
ity In
volv
emen
t
Executive Assistant and Chairperson of the GPC Indigenous Future Directions Liaison Group, Lee-ann Dudley (pictured). The Group was created in 2008–09 to ensure the Indigenous community benefits from the prosperity the Port of Gladstone generates. The Group concentrates on developing career pathways for Indigenous youth; resolving issues of concern; the impact of port growth; and raising cultural awareness through training for current and future employees.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
Community | Our Community Involvement | Gladstone Ports Corporation | Annual Report 2008–09 63
Outcomes 2008–09Provided industry tours to 800 participantsProvided funding of $134,495 through our Community Support Program
Launched our new website in October 2008
Formed the GPC Indigenous Future Directions Liaison Group
Held GPC’s Biggest morning Tea in may 2009
Conducted an annual bursary program
Completed the marina’s refuelling facility upgrade in September 2008
Commenced a dredging project within the marina in may 2009
Installed billboards at marina entrances in April 2009
Refurbished four private pens and two charter pens at the marina
Targets 2009–10Host biennial Port Open Day in October 2009
Host inaugural Fun Run in June 2010
Conduct a Corporate Image Study by end 2009
Finalise plans for a sewage disposal facility for all marina vessels by end 2009–10
Complete Stage 1 of new marina boat ramp
Our community involvementWe continue to build on our community partnerships, providing regular communication; tours of our facilities; support of community events and non-profit organisations; and providing and maintaining waterfront parklands plus a marina for the community to enjoy.
Providing port toursWe provide a free weekly tour of port facilities each Tuesday from 10am–11.30am for community members and visitors.
During 2008–09, 511 people participated in our weekly industry tours (2007–08: 598). Additional tours for 271 school/higher education students (2007–08: 212) and 18 community group members (2007–08: 203) saw a further 289 (2007–08: 415) visitors to the port, bringing the total number of tour participants for 2008–09 to 800 (2007–08: 1,013).
Com
munity
Community | Our Community Involvement | Gladstone Ports Corporation | Annual Report 2008–0964
Our
Com
mun
ity In
volv
emen
t con
t... keeping our
community informedWe interact with our community on a regular basis using various communication tools including:
• generalmediacoverage– generated through media releases
• Port Talk – a quarterly newsletter featuring information on port development and community and environmental activities which is distributed to over 16,000 Gladstone households
• PortofGladstonebrochure–an introduction to the Port of Gladstone, its wharf centres and the shipping process
• CoalPortbrochure–adetailedguide to both RGTCT and Barney Point Coal Terminal
• PortofGladstoneandPortAlma Shipping Terminal handbooks – providing a comprehensive description of each port facility
• factsheetsonvariousport-related activities including environmental monitoring, employment and training opportunities, our marina parklands and our Community Support Program
• AnnualReport–adetailedreport of our ports’ activities and performance during the financial year
• website(www.gpcl.com.au) – general information on port facilities, publications, news, environmental activities, employment, corporate governance, marina and its parklands, port tours, etc
• AnnualCommunityandStakeholder Presentation – an update provided by our CEO.
Our Community Working Group met five times throughout the year, discussing the Port of Gladstone’s various environmental activities. See page 57 for more information.
We launched our new website in October 2008, introducing a more contemporary and easier to navigate site. The website features up-to-date information on GPC’s activities relevant to customers, port suppliers and community members. It includes information about our history, port facilities, environmental and community activities, the Gladstone marina and events, news and publications and careers. To communicate effectively with our key international customers, links to Japanese, Chinese and korean versions of the website will be introduced in early 2009–10.
In order to maintain strong relationships with our Indigenous community we formed the GPC Indigenous Future Directions Liaison Group in march 2009. The Group, comprising GPC representatives and members of the community, aims to ensure that the Indigenous community benefits from the prosperity the Port of Gladstone generates. In particular, the Group concentrates on the development of career pathways for Indigenous youth, resolving any issues of concern, the impact of growth within the port and raising cultural awareness through training for current and future employees. The Group meets bi-monthly and reports to our Board and management team.
We received a Gold Award in June 2009 for our 2007–08 Annual Report through the Australasian Reporting Awards (ARA). The award recognises the report as a model for other peer reports; its overall excellence in reporting; high-quality coverage of most aspects of the ARA criteria; full disclosure of key aspects of our core business; and the manner in which it addressed current legislative and regulatory requirements.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
Community | Our Community Involvement | Gladstone Ports Corporation | Annual Report 2008–09 65
Supporting our communityOur Community Support Program continued in 2008–09, providing financial and in-kind assistance to various community groups and non-profit organisations in Central Queensland. The program supports art, music and cultural activities, education, health and welfare, environmental initiatives, and major events.
We provided $134,495 in sponsorships and donations during 2008–09 (2007– 08: $227,358, was significantly higher than previous years due to us supporting the Blackwater International Coal Centre at $150,000), assisting 23 organisations with their community events, projects and research activities.
We continue to provide in-kind support in the form of below-market tenancies in GPC buildings to 12 organisations to the value of $446,354 (2006–07: $279,960). Current tenants include the Gladstone maritime museum, Genealogical Society Gladstone District Inc., Gladstone municipal Band, Roseberry Youth Services, and the volunteer marine Rescue Service Headquarters.
2008–09 sponsorship and donation recipients included events and organisations such as the victorian Bushfire Appeal. GPC matched the $13,020 contributed by its employees to donate a total of $26,040. Cancer Council Queensland, Gladstone Harbour Festival, St vincent de Paul, The Salvation Army, Lifeline, Anglicare and the Nhulundu Wooribah Indigenous Health Organisation also received financial support throughout the year.
We also provide labour as in-kind support to assist with school and community projects. Employees were involved with a number of projects throughout the year including the set-up of the stage and Christmas tree lights for the 2008 Gladstone Carols by Candlelight.
With the assistance of our coal customers, we purchased Gladstone’s marley Brown Oval in June 2009. The popular sporting oval was closed after the Gladstone Leagues Club was put into receivership in 2007. We contributed in excess of $1 million, with a further $2 million from coal companies to ensure that the oval was returned to the community, through a long-term lease with Gladstone Regional Council, as a major sporting facility.
We thank BmA Coal, Ensham Resources, Felix Resources, Jellinbah Resources, Cockatoo Coal, Wesfarmers Coal and Xstrata Coal Australia for their generous contributions in preserving the oval for the Gladstone community.
Encouraging employee involvementOur employees are actively involved with charity events and fundraising each year, volunteering for a number of activities that not only benefit our community but also the nation.
In march 2009, 25 (2007–08: 62) of our employees collected rubbish from Gladstone streets, parks and waterways as part of the nation’s Clean up Australia Day.
1
1. With its boardwalks and parklands, the Marina is a popular community recreational facility.
In may 2009, more than 70 employees supported our fourth GPC Biggest morning Tea – a fundraiser that supports the Cancer Council of Australia’s Biggest morning Tea. A total of $500 (2006–07: $809) was raised – $250 from the event and a dollar for dollar match from GPC.
Several other events including Gladstone’s EcoFest (held as part of World Environment Day activities – June 2009) also involved the support of several dedicated employees to construct and conduct a GPC display. Our employees also play a vital role in the planning and staging of our biennial event, Port Open Day.
In December 2008, GPC Operations Planner Peter Hening, was recognised as Employee volunteer of the Year for his outstanding contribution to GPC associated community events.
Community | Our Community Involvement | Gladstone Ports Corporation | Annual Report 2008–0966
Encouraging education opportunitiesOur annual Bursary Program for Central Queensland High Schools (which fall under the operating area of GPC), offered annually in August, encourages students to complete further education. We provide $12,000 in bursaries to 28 schools each year, with each selected student receiving either a $500 senior bursary or $250 junior bursary. Bursary students are selected by their Principal and teachers based on their academic performance.
We are proudly associated with the Australian marine Environment Protection Association’s (AuSmEPA’s) internet based school educational program. The program, launched by AuSmEPA in April 2009, is an educational tool that allows students to learn about the role of shipping and the transportation of cargo, how ships stay afloat, the journey of various cargoes and what ships must do to prevent sea and air pollution. A link to the online AuSmEPA program is available via our Education section on our website – www.gpcl.com.au and the AuSmEPA site – www.ausmepa.org.au/.
maintaining our popular marina and parklandsOur Gladstone marina and Spinnaker Park offer 35 hectares of recreational waterfront facilities. These include free barbeque facilities and shade shelters, 250 mooring berths, playground equipment, walking trails, and a man-made beach.
During 2008–09, the area continued to provide the venue for a number of events including the Gladstone Harbour Festival, Gladstone Seafood Festival, Carols by Candlelight and Gladstone multicultural Festival.
Our
Com
mun
ity In
volv
emen
t con
t... Billboards were installed at the
marina’s two entrances in April 2009, welcoming and farewelling those that visit the parklands. The billboards will assist us in promoting our provision and maintenance of the marina and its parklands.
Boating facilitiesOur marina offers the boating fraternity a first-class base from which to cruise the Capricorn and Bunker Reef Groups of the Great Barrier Reef waters.
The floating marina system uses concrete encased styrene pontoons and allows generous mooring and manoeuvring space within each pen area. The combination of the sheltered waters of Port Curtis, the marina basin and marina pen design provides safe mooring even during inclement weather.
Each year our marina maintains a high occupancy rate. In 2008–09 the marina recorded an occupancy rate of 86.3%, a slight decrease on 2007–08 (87.1%).
Investigations into the development of an additional marina at the southern end of the Gladstone harbour are ongoing, involving our Port Planning and Development department employees and other governmental bodies. The proposed facility would be constructed within the Boyne River mouth, providing additional small craft facilities to local boating and fishing enthusiasts.
marina maintenanceThe marina has been operating for more than 20 years, providing a quality facility for the local community and visitors.
During 2008–09, we refurbished four of our 250 mooring berths and two charter pens, which involved the replacement of a main walkway and upgrade to the electrical and water systems.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
Community | Our Community Involvement | Gladstone Ports Corporation | Annual Report 2008–09 67
1
2
1. Gladstone’s Marina.
2. Auckland Creek inlet – where Gladstone’s Marina meets the city.
We completed our refuelling facility upgrade in September 2008, relocating the existing fuelling pontoon to the service wharf area and installing a 20,000 litre underground-unleaded fuel tank. It is a self-serve facility with an electronic fund transfer (EFT) capability.
Planning has commenced for the installation of a new sewage disposal facility for all marina vessels and other onshore facilities to service marina tenants and the wider community.
maintenance dredging of the Gladstone marinaTo ensure vessel safety in the Gladstone marina, GPC completed preliminary dredging to address sediment, which has built up since the marina’s construction in 1988. The dredging project, commenced in may 2009, saw the transfer of sediment onto land adjacent to the marina. This material will be used as land-fill for future port projects. Additional dredging will continue within the marina in 2009.
marina entertainmentWe continue to provide our free monthly community entertainment program, Sunday Sessions at the marina, on the last Sunday of each month. Each performance takes place near barbeque facilities and playground areas within the marina parklands, creating the ideal family outing for community members and visitors. Our mascot, Curtis the Turtle, is a regular visitor to Sunday Sessions, entertaining the littlest members amongst the audience.
With an aim to create an added cultural element to weekend family activities available in Gladstone, the Sunday Sessions program involves performances by soloists, duos, big bands and theatre groups. On average more than 100 people of various ages attend each session.
Looking aheadWe will again proudly stage our biennial Port Open Day in October 2009 and will continue to prepare for the staging of our inaugural Fun Run to be held at the end of June 2010.
Our Sunday Sessions at the marina entertainment program will continue, providing regular, free, live entertainment to our marina visitors and community members.
We will continue to enhance educational initiatives in partnership with our local schools and associated industries, and will further develop our mascot, Curtis the Turtle, within our community.
Our Corporate Image Study – Community component will be conducted in late 2009, providing us with the valuable knowledge required to implement the necessary actions to enhance our image within the community.
Ongoing maintenance will continue at our marina, incorporating the development of a strategy to install a sewage disposal facility.
We will continue to develop our marina parklands for the enjoyment of the community.
We employ 646 people, and with the development of new industry, over the next five years we expect employee numbers will increase significantly.Pictured: Assistant Landscaping Foreman Dennis Harvey and 1st year Horticultural Apprentice, Elissa Duff tend to the fruit trees planted within RGTCT’s grounds during the year.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
People | Gladstone Ports Corporation | Annual Report 2008–09 69
Peo
ple
People 69
Our Employees 70
Our Safety 80
Our Health 84
People | Our Employees | Gladstone Ports Corporation | Annual Report 2008–0970
Our
Em
ploy
ees
Information Systems Officer – Application Development, Annie Rich was selected by our Board and Management team to participate in our 2009 Women’s Leadership Program. Annie commenced work at GPC just over 7 years ago as a vacation student while she was in the second year of her Information Technology degree.See page 74 for more information.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
People | Our Employees | Gladstone Ports Corporation | Annual Report 2008–09 71
Outcomes 2008–09maintained low staff turnover rate of < 5% (core full-time employees)
Implemented Leadership Development Program in July 2008
Commenced implementation of Human Resources management System in late 2008–09
Implemented Reclassification Process
Achieved a 12-month extension of existing Certified Agreement
Commenced a review of outstanding issues from previous Enterprise Bargaining Certified Agreements
Targets 2009–10Successfully negotiate three-year Federal Enterprise Agreement by November 2009
Expand and consolidate Learning and Development Program
Review and enhance Leadership Development Program
Complete implementation of Human Resources management System
Continue implementation of Production Reclassification Process
Conduct Corporate Image Study – Employee component in late 2009–10
Our peopleAs at 30 June 2009, we employed 646 people (2007–08: 606) in a variety of management, trade, technical and administrative roles within our Commercial; Project; Port Planning and Development; Operations Support; Port Operations; and Corporate Relations departments. Of these, 557 are full time employees (2007–08: 510), and 89 are job share/casual/ temporary (2007–08: 96).
This increase in employee numbers, experienced primarily within our Port Development department, is a result of our focus on strengthening our skill and knowledge base in preparation for expected port growth.
With the development of new industry, over the next five years we expect employee numbers will continue to increase.
Our employees play a vital role in ensuring we meet our business objectives. We provide a variety of training initiatives to enhance our employees’ skills and knowledge, enhancing both their future and ours.
We nurture and develop the capability of our people by providing apprenticeships, traineeships, training sessions on health and safety issues, job skills and professional development courses.
We implemented a Business Planning Cycle and Learning Development Program during 2008–09, to address staff retention and employee development, career succession planning through department and individual performance reviews and score cards.
NumBER OF EmPLOYEES
June 09 June 08 June 07 June 06 June 05
Full time 557 510 492 452 403
Casual/temp 89 96 85 61 50
Total 646 606 577 513 453
People | Our Employees | Gladstone Ports Corporation | Annual Report 2008–0972
Our
Em
ploy
ees
cont
...
Recognising the skills of our employeesOur Reclassification Process involves employees from the Production, Earthworks, marina, Landscaping and Revegetation departments as well as Trades Assistants. The process has seen each person’s role aligned with the appropriate National Competency standards. In-house assessors were identified and trained to allow them to grant Recognition of Prior Learning (RPL) and/or challenge test to demonstrate competency under the auspices of the Registered Training Organisation – Central Queensland TAFE.
Retaining our employeesOur staff turnover rate for 2008–09 was 4.81% (2007–08: 5.61%). Historically, we have a low turnover rate which, we believe, highlights the success of our initiatives to promote GPC as an employer of choice.
Determining wages and conditionsOur employees are currently governed by two certified agreements that determine wages and conditions. The State Certified Agreement relates to all maintenance and production personnel, while the Federal Certified Agreement covers all office-based and administration staff. Each became preserved agreements under the WorkChoices legislation and were negotiated for a 12 month extension in October 2008. With the agreements due to expire in October 2009, negotiations, involving the Australian Services union (ASu), Construction, Forestry, mining and Energy union (CFmEu), Australian Workers union (AWu), Australian manufacturing Workers union (AmWu) and the Communications, Electrical and Plumbing union (CEPu) have been ongoing and will result in one federally registered Certified Agreement. These agreements include employees at both Port of Gladstone and Port Alma Shipping Terminal.
Wages employees and salaried officers are paid in line with the respective Certified Agreements and the Salaried Officers Policy. As a Government Owned Corporation (GOC) our employees receive pay increases in line with the Cabinet Budget Review Committee (CBRC) Wages Guidelines. Non-salaried employees under the Federal Agreement also progress through a band/level structure to achieve pay increases.
We contribute 12.75% of each employee’s salary to their QSuper managed superannuation account; employees co-contribute 5% of their salary. Our employees also have the option to salary-sacrifice contributions to their superannuation fund.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
People | Our Employees | Gladstone Ports Corporation | Annual Report 2008–09 73
1. Level 5 Dozer Operator, Dale Maloney.
2. Marina Utility Officer, Grahame Condon works within our Corporate Relations department, assisting with the maintenance of the Marina and its parklands and providing various small-craft services, such as delivery of goods to vessels and nearby islands.
“ Our staff turnover rate for 2008–09 was 4.81% (2007–08: 5.61%).”
12
Providing flexible work arrangementsWe provide a rostered day off (RDO) program for our wages employees, and a job share arrangement is in place for some clerical-based positions. Job share arrangements are also available for our senior production employees.
Our long-serving employees possess the knowledge and skills that are invaluable to the training of new employees. We provide our employees who are nearing retirement with a flexible work arrangement that accommodates their needs – assisting us to retain them, and educate the next generation of our employees.
Creating equal employment opportunitiesWe provide employment opportunities for all people, including nominated Equal Employment Opportunity (EEO) target groups (women, Aboriginal and Torres Straight Islanders, people from non-English speaking backgrounds and those with a disability), on an equal and unbiased basis
Our EEO management Plan aims to ensure our workplace is free of harassment and discrimination and incorporates the requirements and objectives of the Anti-Discrimination Act 1991 and Equal Opportunity in Public Employment Act 1992 (Qld).
People | Our Employees | Gladstone Ports Corporation | Annual Report 2008–0974
Our
Em
ploy
ees
cont
... Providing opportunities to our female employeesWe employ 80 female staff in all departments including our Administration, Health, Safety, Environment, Landscaping and Revegetation, Employee Relations, Commercial, Community Relations and Production departments.
Each year we host a Women’s Forum for our female employees, addressing issues faced by this group. Held in August 2008, 57 female staff attended the forum, gaining information on time management and organisational skills.
We also provide our female employees with an opportunity to gain leadership skills through our annual Women’s Leadership Program, with Information Systems Analyst Programmer Annie Rich selected to participate in 2009. The Program is aimed at building the foundations for a successful career in management by identifying strengths and opportunities for personal growth, enhancing the participant’s personal skills and increasing assertiveness. Annie participated in a five-day New manager Program at the university of New South Wales’ Australian Graduate School of management in June 2009. As part of the Program, Annie is currently applying her newly acquired skills to a specific information systems project receiving on-the-job coaching and mentoring. Female employees are encouraged to provide written applications for the Program before the end of march each year, with the successful applicant being chosen by our management team each April.
1
2
1. Payroll Officer, Hayley Walton is currently seconded to work as part of the Commercial department team to fully implement the Human Resources Management System.
2. Asset Accountant, Emma Nethercote is responsible for the analysis and adherence to financial requirements of commercial projects.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
People | Our Employees | Gladstone Ports Corporation | Annual Report 2008–09 75
BREAkDOWN OF EmPLOYEE POSITIONS AS AT 30 JuNE 2009
Profession Fulltime Permanent temporary
Casual Jobshare Total
Administration 152 23 4 5 184
Building trades 10 0 0 0 10
Electrical 53 7 0 0 60
Engineering 21 0 0 0 21
mechanical 44 7 2 0 53
Painters 4 0 0 0 4
Production 273 25 16 0 314
Total 646
EQuAL EmPLOYmENT OPPORTuNITY (EEO) STATISTICS 2008–09
Profession Female male ESB NESB 1
NESB 2
NESB N/R
ATSI Non-Indig
ATSI N/R
PWD Non-PWD
PWD N/R
managers and administrators 1 20 21 0 0 0 0 21 0 1 20 0
Professionals 5 18 22 1 0 0 0 23 0 2 21 0
Associate professionals 5 28 32 1 0 0 0 33 0 8 25 0
Tradespersons and related workers
2 145 142 1 3 1 1 145 1 13 132 2
Advanced clerical 14 9 22 1 0 0 1 22 0 2 21 0
Intermediate clerical, sales and service workers
41 22 60 2 1 0 0 63 0 3 60 0
Intermediate production and transport workers
0 89 88 0 1 0 1 88 0 17 71 1
Elementary clerical, sales and services workers
13 5 18 0 0 0 5 13 0 0 18 0
Labourers 13 216 225 1 1 2 2 226 1 16 212 1
Total employed 94 552 630 7 6 3 10 634 2 62 580 4
ESB English speaking background
NESB 1 Non-English Speaking Background – person has migrated to Australia (first language is not English)
NESB 2 Non-English Speaking Background – person’s parents migrated to Australia (first language is not English)
ATSI Aboriginal and Torres Strait Islander
PWD Person with a Disability
N/R Indicates that when surveyed the person has not indicated their response to a particular question
“ We provide our female employees with an opportunity to gain leadership skills through our annual Women’s Leadership Program.”
People | Our Employees | Gladstone Ports Corporation | Annual Report 2008–0976
Our
Em
ploy
ees
cont
... Fostering personal and professional developmentWe are committed to providing world-class personal and professional training opportunities through our Apprenticeship Program, traineeships, leadership development opportunities, tertiary study assistance, vocational placement and work placement scheme for employees.
With the rapid growth of our organisation, leadership development was identified as critical, leading to the introduction of our Leadership Program in 2008–09. The program, held over 12 months, aims to maintain a consistent level of management skills within GPC, providing our employees with the necessary skills to facilitate progression within the organisation and, if desired, attainment of a formal qualification. Coaching and support are available to participants, assisting them to gain effective leadership skills that align with our values. The 2008–09 program involved 48 participants. An evaluation is underway to enhance the program’s current format and identify the next target group.
Assisting our employees in gaining further educationOur employees are encouraged to participate in tertiary education. Our Tertiary Study Assistance Scheme provides benefits to employees undertaking study toward self-development and improved qualifications. The scheme provides employees with financial assistance towards the cost of tertiary study in recognised courses that will benefit their role and our organisation.
Ten employees undertaking further study were supported through the scheme during 2008–09.
Building the workforce of the futureApprenticeshipsThis year we engaged 41 apprentices in the mechanical, Electrical, Carpentry, Plumbing, Refrigeration and Horticulture fields. Thirteen of these are new apprentices, who were employed from our January 2009 intake (including five Diesel Fitters, five Electricians, one Carpenter, one Plumber and one Horticulture apprentice (the Port of Gladstone’s first apprentice in this field). In January 2009, seven of our apprentices graduated and commenced work as tradespersons. Of these, three electrical apprentices completed their apprenticeships as Electrotechnology Systems Electricians. Three mechanical apprentices completed their apprenticeships in Engineering (mechanical Diesel Fitting). One carpentry apprentice completed Certificate III in Carpentry.
1
1. Second year GAGAL Electrical Apprentice, Brett Kelly (facing) and 4th year adult GAGAL Electrical Apprentice Trevor Van Zelst welding on brackets in preparation for an electrical shutdown.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
People | Our Employees | Gladstone Ports Corporation | Annual Report 2008–09 77
GPC YOuTH EmPLOYmENT AND TRAINING
2008–09 2007–08 2006–07 2005–06 2004–05
Apprentices
1st year 13 12 9 6 7
2nd year 12 9 6 7 6
3rd year 9 6 7 6 8
4th year 6 7 6 8 6
Total apprentices 40 34 28 27 27
Trainees 19 14 9 11 8
vocational placement students 2 2 5 5 6
Work placement students 60 53 24 16 15
Total employed 121 137 66 59 56
Gladstone Area Group Apprentices Ltd (GAGAL) apprenticesIn 2008–09 we hosted 11 GAGAL apprentices, five of which are full-time apprentices, and 6 displaced apprentices. The displaced apprentices joined GPC following the cancellation of their placement with their original host, allowing them to continue their apprenticeship under our supervision.
Australian Technical College (ATC) – school-based apprenticesIn 2007, we engaged our first two mechanical school-based apprentices from the ATC. under this ATC initiative apprentices alternately attend school and work in two week periods, offering an intense and structured learning regime, and ensuring a continuous stream of labour for our port operations. These ATC apprentices have been a very valuable addition to our apprentice team and will graduate from ATC in December 2009. At this time they will join our workforce as second year mechanical apprentices. We will repeat this strategy during our 2010 apprentice intake.
TraineeshipsWe are committed to offering training opportunities for local youth. Our Employment and Traineeship Program and Gladstone Industries’ Aboriginal and Torres Strait Islander (ATSI) Youth Employment Program provides local youths with on the job skills they require for a promising career. Our ATSI Youth Employment Program has facilitated over 200 applications for placements with a host of employers in the Gladstone area including the Port of Gladstone.
In partnership with the Department of Training, Employment and Industrial Relations, a Gladstone-based recruitment and human resource company and the Program’s Indigenous mentor, we have assisted 47 individuals to gain employment, including traineeships and apprenticeships.
Nineteen trainees participated in our Traineeship Program in 2008–09:
• fourtraineescompletedtheirHorticulture Traineeship in may 2009 within our Landscaping and Revegetation department. These trainees will gain a Certificate II in Horticulture
• fourtraineescommencedtheirCertificate II in Horticulture Traineeship in march 2009 in our Landscape and Revegetation department
• twotraineescommencedtheir Certificate II in Transport and Distribution (Stevedoring) traineeship in December 2008 within our Production department
• oneofourexistingstevedoretrainees completed a Certificate II in Transport and Distribution (Stevedoring) and progressed to a Certificate III in Transport and Distribution (Stevedoring) in December 2008
• onetraineecompletedCertificate III in Transport and Distribution (Warehousing) in April 2009
• onetraineecompletedCertificate II in Transport and Distribution (Warehousing) in April 2009
• threetraineescommencedtheir Certificate Iv in Transport and logistics (Warehousing and Storage) in April 2009.
People | Our Employees | Gladstone Ports Corporation | Annual Report 2008–0978
Our
Em
ploy
ees
cont
... Work experienceWe operate two work experience programs, a Structured Workplace Learning Program and a vacational Placement Scheme. Our Structured Workplace Learning Program gave 51 high school students an opportunity to view, first-hand, the many and varied career opportunities available at GPC, while our vacational Placement Scheme allowed 6 university students to gain valuable on-the-job work experience.
keeping our employees informedWe continue to strengthen our communication to employees and recognise the need to maintain timely, accurate information in our constantly changing work environment.
Our employees receive communication on a regular basis via a number of different mediums and are able to access work-related documents, publications and policies via our internal website. These include:
• amonthlyMessageFromTheCEO – this correspondence (a letter posted to each employee’s home address) keeps employees informed on port performance issues, developments and achievements
• AnnualBusinessForums–conducted by our CEO these sessions, provided to various departments over several days, inform employees on matters relating to current port developments and future directions
• ToolboxTalks–theseweeklybriefings are held in various work areas and provide updates on port developments, safety, achievements, opportunities and challenges
• SafetyBulletins–electronicbulletins (distributed as required) advising on issues associated with shutdowns or events that may affect the general operations of the port
• SafetyAlerts–electronicnotification of a high risk activity/event that is to occur or an incident that has occurred resulting in an injury or notifiable event
• SafetyandEnvironmentupdates – electronic notification to employees that provides details on the past week’s safety and environment statistics, injuries, incidents and hazards. This also includes information for Toolbox Talks
• OfftheJobHealthandSafetyInformation – a letter to employees and their families sent to their home. This letter provides information and promotes not only health and safety within the home, but also a healthier, safer community
• weeklysafetystatistics–emailed to employees, these provide details of the week’s safety statistics, injuries and hazards. Hard copies of these statistics are placed on notice boards.
In July 2009 we will introduce our new-look quarterly newsletter – Port Life. This newsletter replaces our Workers Weekly publication and aims to provide employees and their families with information on both the serious and the lighter side of life at our ports. In particular, the newsletter will present stories on our safety and health initiatives, operational performance and projects, employee profiles and new appointments, and employee and community events. The newsletter will be posted to each employee.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
People | Our Employees | Gladstone Ports Corporation | Annual Report 2008–09 79
Noticeboards throughout our port sites also provide a forum for us to promote our activities and initiatives to our employees and contractors, with posters relating to our health and safety programs and EB agreements often displayed.
In late 2008–09 we commenced the implementation of a Human Resources management System, providing our employees the opportunity to view, on-line, payslips, Group Certificates and training opportunities, and receive messages. It will also allow users to update personal details, apply for leave and apply for internal positions. The system also provides our Human Resource team a platform for improved reporting, record keeping and transactional integrity.
Giving our employees a voiceA free call hotline provides our employees with an avenue to confidentially relay their complaints and concerns. The number links directly to a call centre provided independently by our internal auditors. Each call is logged and details of the complaint are directed to appropriate personnel.
The objectives of our hotline are to:
• promoteandencourageallemployees to report concerns with respect to fraud and related misconduct within GPC so that these can be appropriately dealt with
• provideanalternative,independent option for confidential reporting of issues and concerns
• permittheconfidentialreporting and discussion of issues of concern to individual employees regarding potential fraud and related misconduct
• assistemployeeswithethicaldilemmas and concerns and provide a healthier working environment.
Employees always have the option of reporting matters of concern to their line supervisors and managers, but they are encouraged to use the Hotline to report any suspicions of fraud and related misconduct to enable a confidential process. We provide an assurance to employees that when concerns are reported with honest intent, they will be fully supported. There were no calls made to the hotline regarding potential fraud and related misconduct during 2008–09.
Looking aheadWe will continue our focus on attracting and retaining skilled employees to support the development occurring within our ports and our existing (and future) industries. Our Business Planning Cycle, Leadership Development Program, and Human Resources management System will mature and continue to realise benefits.
The Reclassification Process will progress for employees in Operations and associated areas. A focus will be on developing the traditional white collar workforce and embedding a career and succession planning process.
Enterprise Bargaining renegotiations will continue with the existing agreements expiring in October 2009 and expected to be replaced by a single three-year Federal Agreement.
We will identify and implement processes that will enhance employee engagement and promote a consultative culture through our Corporate Image Study – Employee component, to be conducted in late 2009–10.
1
1. Second-year Electrical Apprentice, Zoey Ahern works alongside Maintenance tradesmen within our unloading and loading operations.
People | Our Safety | Gladstone Ports Corporation | Annual Report 2008–0980
Ensuring a safe environment for our employeesThe health and safety of our employees remains a primary focus within our organisation. We are constantly monitoring safety using a framework that ensures workforce involvement. This framework, developed through the collaborative involvement of safety committees (which include members of management), provides a ‘top down’ and ‘bottom up’ approach to the issue of improved safety.
Our Workplace Health and Safety Committee (Site Safety Committee), comprising management and staff representatives from each of our departments meets monthly to discuss health and safety issues and develop initiatives to create a safer and healthier workplace for our employees.
Safety observations and workplace inspections are conducted regularly by the Maintenance and Operations departments to ensure day-to-day workplace activities are carried out in the safest manner.
Outcomes 2008–09Attained National Safety Council of Australia 5-star rating for our Safety Management System
Lost Time Injury total of 7 with a Lost Time Injury Frequency rate of 4.81
Reviewed policies and procedures for Random Drug Testing and Fatigue Risk Management
Conducted Dangerous Goods and Hazardous Substance Physical Risk Survey
Completed risk assessments for hazardous substances and dangerous goods, confined spaces and asbestos containing material
Targets 2009–10Maintain NSCA 5-star safety rating
Reduce Lost Time Injury Frequency Rate to zero
Implement Random Drug Testing and Fatigue Risk Management
Revise and implement incident investigation process
Our
Saf
ety
Working towards zero Lost Time Injury Frequency Rate (LTIFR)We recorded 7 Lost Time Injuries (LTIs) during the year, which resulted in the loss of 149 days. Our LTIFR at year-end was 4.81, an increase on the previous 12 months and marginally above the Coal Export Terminal of Australia (CETOA) average (3.17) which we use as an industry benchmark.
In an effort to reduce our LTIFR figure to zero, and reinforce the importance of safety throughout our organisation, we continue to implement our Continuous Improvement Action Plan (CIAP) and Fit-For-Work Policies.
We ensure safety awareness amongst our employees through regular safety bulletins, safety alerts, toolbox and pre-start meetings, weekly safety statistics, employee newsletters, safety meetings, team briefings and training sessions.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
People | Our Safety | Gladstone Ports Corporation | Annual Report 2008–09 81
Sustaining a high standard of safetyWe are proud to now possess a 5-star safety rating, following the National Safety Council of Australia’s (NSCA’s) safety audit in December 2008. Recommended actions from this audit have been added to our CIAP. An internal audit of the CIAP is conducted every three months by safety staff, with a full audit conducted annually by management representatives.
Promoting responsible behaviourRandom alcohol testing occurs on a regular basis at our various port sites as part of our Fit-For-Work Policy. All staff, contractors and visitors are liable for testing at any time during work hours.
The policy mandates a Zero alcohol tolerance. Failure to comply with this policy requirement results in a disciplinary process.
The Fit-For-Work Group, with representation from management and all unions, met regularly throughout the year to develop policies and procedures for drug testing and fatigue management.
1. GPC employees oversee the movement of a dozer on the calcite stockpile at Gladstone Port Central.
2. Welding is performed by two employees wearing compulsory personal protective equipment (PPE).
12
Occupational Hygiene MonitoringDuring the year we continued to implement our Occupational Hygiene Monitoring Plan. Under the plan, we assess our employees, measuring the effects of their exposure to dust, vibration, heat stress, noise, hazardous substances, luminance, indoor air quality, electromagnetic fields, supplied breathing air, biological hazards and lead. These monitoring activities focused on employees exposed to coal dust at RGTCT; noise in, and around, dump stations; and heat stress at identified high-risk locations. This monitoring identified the need for further improvements in noise mitigation in some dump stations, and corrective actions are currently being undertaken.
People | Our Safety | Gladstone Ports Corporation | Annual Report 2008–0982
Our
Saf
ety
cont
... GPC safety inductionOur employees attend a safety induction upon commencing employment and a refresher safety induction every two years. Contractors and port users participated in a refresher safety induction as part of the process of rolling out our new site access system. See page 38 for more information.
Incident management SystemOur managers and supervisors undertake incident management training as part of our Incident management System (ImS). In 2008–09, 61 staff attended ImS training. System proficiency provides management with the operational skills required to ensure the safety of our employees, protect our critical infrastructure and recover from incidents. It also underpins the process for risk management and contingency planning.
Risk managementRisk management training is provided annually to our employees. This training provides them with the key skills required to conduct personal Job Safety Analyses and Risk Assessments. In 2009–10, emphasis will be given to improving the incident investigation and root cause analysis skills of superintendents, supervisors and safety representatives.
QR Limited (QR) staff provided rail safety awareness training to GPC Operations employees in may 2009. The QR program provides workers with awareness of QR’s safety requirements. Participants receive a Trackside Safety Card (Pink Card) which allows them access to QR’s right-of-way areas located within our facilities.
Our employees received ergonomic, injury prevention and muscular skeletal training in 2008. This training was developed by Occupational Health Services Australia (OHSA) in conjunction with our Health and Safety team. It provides our employees with instructions on how to prevent back injuries, strains and sprains, and focuses on reducing the incidence of these type of injuries in our workplace. This training is provided annually to all employees.
During 2008–09 a Dangerous Goods and Hazardous Substance Physical Risk Survey was conducted and a substantial number of risk assessments completed. The outcomes of the survey were used to update our Dangerous Goods/Hazardous Substance registers, our overarching Risk Register, and Emergency Response Plan. A new procedure for managing hazardous substances and dangerous goods on our sites was also developed and implemented throughout the year.
Asbestos registers for our sites and assets were reviewed during the year. This information provides the basis for developing a plan that will see the progressive removal of asbestos from all of our sites. During the year asbestos containing materials were removed from several of our properties including a building and pipeline at Barney Point Coal Terminal (BPCT), the old ship loader at Port Alma Shipping Terminal and the old Yarwun School. At several other sites, polyvinyl acetate (PvA) spray was used to seal material containing asbestos and eliminate potential exposure pathways.
A risk survey reviewing all confined and controlled workspaces was conducted during 2008–09, with the data allowing us to update our Confined Space Register. Employees receive regular training to ensure they are aware of the risks associated with such environments.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
People | Our Safety | Gladstone Ports Corporation | Annual Report 2008–09 83
Traffic managementDisappointingly, we recorded a high rate of traffic and vehicle-related incidents during 2008–09. In response, we have commenced a review of existing vehicle, plant and equipment procedures and will develop and implement a new on-site traffic management standard in 2009–10.
In September 2008, 22 of our apprentices and trainees attended Defensive Driver Training. The program incorporates a Young Driver Safety Program; a special one-day driver awareness course primarily aimed at young and novice drivers.
Queensland Fire and Rescue Service delivered their Road, Attitudes and Action Planning Program to a cross section of our employees in December 2008 and January 2009. Apprentices, trainees and Operations employees attended the program which is designed to raise awareness of the causes of car crashes. The training aims
Looking aheadIn the coming year we will seek to retain our NSCA 5-star safety rating. We will also assess the benefits of moving to an alternative safety assessment system that is more aligned to the other quality systems used on our sites.
We will continue our focus on reducing our LTIs and LTIFR to zero. Improving our ability to investigate incidents and identify their root cause which in turn will assist us in our effort to record zero injuries in 2009–10.
Through continued engagement with our employees, we will seek to implement a behavioural-based approach to safety.
The continued implementation of our Occupational Hygiene monitoring Plan will ensure that our employees are not adversely affected by their work environment.
to change driver’s attitudes by encouraging them to plan ahead and avoid potentially dangerous driving situations. The training concluded with a simulated crash rescue that graphically demonstrated how injured people are removed from a vehicle using the Jaws of Life.
While the primary focus of these training programs was to improve vehicle operation safety at our sites, participants gained skills that they can use while driving when away from work. The alarming increase in statistics involving youth in road incidents was a primary focus.
Isolation lockout processA review of our Isolation and Lockout Procedure was progressed during the year. A revised training program to meet current needs and work practices was developed and implemented. The new training program has been delivered to all relevant maintenance and Operations employees.
A new Isolation Planning Training Program was developed and delivered to 36 of our employees during the year. Correct isolation planning eliminates the risk of injury or damage that could result from unscheduled plant or equipment shut downs.
A new High voltage Isolation and Access (HvIA) Training Program was developed for people accessing high voltage areas and performing high voltage isolations. The training provides participants with a clear understanding of their obligations in relation to high voltage exclusion zones.
Our Electrical staff were also provided training in Arc Flash protection. The program highlighted the potential hazards of Arc Flash and the methods to minimise the risk of exposure.
maintaining contractor safetyDuring the year we continued to develop the minimum Requirements for Contractor Safety management. This ensures that contractors are aware of the relevant safety standards, policies, and procedures that might directly affect their safety and contractual obligations whilst on our sites.
People | Our Health | Gladstone Ports Corporation | Annual Report 2008–0984
Our
Hea
lth Outcomes for 2008–09Purchased clinical equipment for hearing assessment and lung function testing
Commenced Stop Sun Spots pilot program
Targets for 2009–10Continue implementation of Stop Sun Spots program
Develop role specific pre-employment screening processes by June 2010
Be Healthy ProgramOur Be Healthy Program is directed at early detection of serious long-term health problems by targeting the high-risk health areas of diabetes, hypertension and obesity. The program provides random screening, education, support, monitoring and referral. During the year, the success of the program was illustrated by the early detection and diagnosis of diabetes, uncontrolled diabetes and hypertension in two employees. These employees were appropriately referred for ongoing management.
Stop Sun Spots Pilot ProgramOur Board approved a pilot program of the Stop Sun Spots Program Industry Trial during 2008–09. The program comprises sun safety education, skin screening, statistical evaluation, and the development of a Sun Safety Policy. At the end of the year, 172 employees had participated in the pilot program. We will roll the program out to the remainder of our employees during 2009–10.
Expanding Occupational HealthOur Occupational Health section serves two key roles: the delivery of preventative health programs, and illness and injury management. During 2008–09, these roles were expanded to include a range of new health services.
Give It Up – Quit Smoking ProgramWe are committed to encouraging employees to give up smoking. The Give It Up program offers free counselling and provides an overview of the effects of smoking, a smoking calculator, monitoring of carbon monoxide levels and referral to the QUIT LINE. A total of 18 services were provided to employees participating in the program during 2008–09.
Further financial incentives and support are available through our Health and Wellbeing Incentive Program.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
People | Our Health | Gladstone Ports Corporation | Annual Report 2008–09 85
Employee medical ProgramWe continue to encourage employee health and well-being by providing a confidential medical program. This free program is offered on an annual basis to employees over 40 and biennially to employees under 40. A total of 116 employees took advantage of the program during 2008–09.
medical benefit schemeWe provide a medical benefit scheme for our employees. under this scheme we make gap payments for employees, and their dependent families, who are members of an approved medical fund. On production of receipts, we reimburse the difference between actual medical, dental, optometry and hospital expenses, and the refund available under private health insurance cover, to a maximum of $3,000 per calendar year.
OCCuPATIONAL HEALTH OCCASIONS OF SERvICE
Occasions of service 2008–09
Total
Work-related rehabilitation 214
Non-work related rehabilitation 137
Q-Super case 60
General consult 16
Case conference 1
Give It up 8
Be Healthy 23
First-aid 6
Pregnancy related 13
Associated paperwork 117
Occupational Physician 65
medical arrangements 33
1. Port Planning and Development Executive Assistants Rene Pavier (facing) and Michelle Beckman.
2. Adjacent to our port facilities, the Marina provides a convenient location for many of our employees to exercise during their lunch break.
12
People | Our Health | Gladstone Ports Corporation | Annual Report 2008–0986
Our
Hea
lth c
ont..
. Health monitoring Health monitoring activities were strengthened this year with the procurement of clinical monitoring equipment. We are currently identifying at-risk employees, and appropriate health monitoring strategies, such as a hearing preservation program, will be implemented in 2009–10.
Influenza immunisationEach year, we encourage our employees to undertake mass immunisation to reduce the spread of influenza and to assist in the reduction of flu-related absenteeism. During 2008–09, 205 employees participated in this voluntary immunisation program.
Hepatitis A & B and Tetanus immunisation Hepatitis and Tetanus Immunisation continues to be offered to potential at-risk employees, particularly those that work within our maintenance department and quarantine facility.
Health and Wellbeing ProgramTo encourage an active lifestyle, employees are eligible for reimbursement of up to $299.99 for allowable items under the scheme. The scheme promotes healthy activities and comprises a range of health, sporting and leisure activities such as weight loss programs, gym membership, sporting gear and quit smoking programs. During 2008–09 167 employees took up this offer.
Employee Assistance ProgramWe continue to provide a confidential counselling service to employees and their immediate families through our Employee Assistance Program. Converge International staff offer a professional, free, 24-hour access counselling service to assist our employees with a range of personal, family and work related issues including, but not limited to: personal empowerment, finances, personal concerns, coping with change, addictions, grief and trauma.
Employment medicalsNew employees and employees transferring between roles are required to undertake pre-employment medicals to ensure they are generally fit-for-work and are not at risk of injury or sickness.
“ Health monitoring activities were strengthened this year with the procurement of clinical monitoring equipment.”
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
People | Our Health | Gladstone Ports Corporation | Annual Report 2008–09 87
Our injury/illness management systemOccupational Physician servicesWe understand that returning to work after injury or illness can be difficult for employees, so we do everything we can to ensure our employees’ needs are met, and the back-to-work transition is as easy as possible.
An Occupational Physician visits the Port of Gladstone monthly to assist with complex case management, injury and illness management and return to work planning for our injured employees.
Work-related injury and illnessDuring the year, we consolidated our work-related injury management processes placing greater emphasis on compliance in injury reporting and return to work programs. This approach resulted in 102 WorkCover reported workplace injuries managed by the Occupational Health section.
Non-work-related injury and illnessDuring the year we assisted 45 employees who suffered from a non-work-related injury or illness. Our aim is to provide early intervention and return to work planning to facilitate a safe and successful return to full duties.
Looking ahead2009–10 will see further development of Occupational Health Services, with a new purpose built facility and additional employee resources. These resources will enable the introduction of formal compulsory health monitoring activities for employees identified as being at risk of exposure to occupational hazards.
We will continue to provide a range of health promotional activities, including expansion of our Stop Sun Spots trial to encompass employees at all sites to enhance their sun safety awareness and promote the early detection of skin cancers.
Claims
Average cost
WORkCOvER TOTAL CLAIm AND AvERAGE COST CLAImS
80
60
40
20
0
16
14
12
10
8
6
4
2
0
Inju
ries
(num
ber)
Ave
rage
cos
t $’0
00
Year
2003
-04
2004
-05
2005
-06
2006
-07
2007
-08
2008
-09
Provision of first aidA number of our employees are trained to deliver first aid, CPR and defibrillation in the event of an emergency. First Aid supplies are provided at all of our sites, and trauma kits are provided at our remote locations.
We operate effectively, efficiently and commercially for the continuing benefit of port users, Central Queensland and the State of Queensland.Pictured: The Port of Gladstone with Boyne Wharf and South Trees wharves in foreground.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
Corporate Governance | Gladstone Ports Corporation | Annual Report 2008–09 89
Cor
pora
te G
over
nanc
e
Corporate
Governance
Cor
pora
te G
over
nanc
e
Corporate Governance 89
Our Board of Directors 90
Our management Team 94
Corporate Governance Practices 96
Financial Review 104
Corporate Governance | Our Board of Directors | Gladstone Ports Corporation | Annual Report 2008–0990
Our
Boa
rd o
f Dire
ctor
s Ian Brusasco amChairman *Ian is currently Chairman of WorkCover Queensland, Chairman of Foodbank (Qld) Pty Ltd and has served as a Director on the Queensland Investment Corporation Board. Ian is a pharmaceutical chemist and partner in two pharmacies. He has extensive commercial and community involvement through numerous directorships and executive roles over the last 45 years. Ian was awarded member, General Division of the Order of Australia (Am) in 1988 and received the Centenary medal in 2003. He was also inaugurated into the Australian Soccer Hall of Fame in 1999 after serving in numerous roles within the sport including: Chairman of Australian Soccer Federation, President of Queensland Soccer Federation, vice President and Executive member of Oceania Football Confederation, and Chairman of Olympic Football Taskforce. In addition to being Chair of the Board, Ian is also Chair of the Human Resources Committee and a member of the Audit and Compliance Committee.
Appointed as Chairman from 1 February 2007 until 31 January 2009. Reappointed from 2 February 2009 until 30 September 2010.
* Ian Brusasco was appointed as Chairman on 1 February 2007.
Charles WareDeputy Chairman **Charles is a legal consultant in a private legal practice in Central Queensland. He previously served as Chair of the Rockhampton Port Authority and has held several Board positions in the corporatised Queensland electricity supply industry. Charles is a member of the Board of Professional Engineers of Queensland and the Residential Tenancies Authority. He is also Deputy Chancellor of Central Queensland university. Charles holds undergraduate degrees in Arts and Law and masters Degrees in Business and Law. He holds a current practising certificate as a solicitor. Charles is a member of the Human Resources Committee.
Appointed 1 July 2004 until 30 June 2007. Re-appointed on 1 July 2007 until 30 September 2010.
** Charles Ware assumed the role of Deputy Chairman on 27 September 2007.
Peter Corones amDirector Peter has over 20 years’ experience in local government, having completed two terms as a Councillor and four as mayor of Gladstone City Council. A business proprietor and company director for more than 30 years, he has a long track record of extensive business and community involvement. He is a member of the Gladstone Economic and Industry Development Board, and a member of the CQ university Gladstone Advisory Committee. Peter was awarded the Centenary medal in January 2001 and member, General Division of the Order of Australia (Am) in January 2009. Peter is a member of the Human Resources Committee.
Appointed 1 July 1994 for two years and extended to 30 June 1999. Re-appointed in 1999 until 30 June 2003; re-appointed in 2003 to 30 June 2005; re-appointed in 2005 to 30 September 2007 and re-appointed in 2007 to 30 September 2009.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureC
orporate G
overnance
91Corporate Governance | Our Board of Directors | Gladstone Ports Corporation | Annual Report 2008–09
1. Ian Brusasco am
2. Charles Ware
3. Peter Corones am
4. Terence Crawford
5. Russell Scott
1 2 3
4 5 6
7 8 9
6. Andrea Staines
7. Tony Kelly
8. Gail Davidson
9. Judy Reynolds
Corporate Governance | Our Board of Directors | Gladstone Ports Corporation | Annual Report 2008–0992
Our
Boa
rd o
f Dire
ctor
s co
nt... Terence Crawford
DirectorWith degrees in economics and law, Terry brings over 28 years’ experience in banking, investment banking, corporate advisory, mergers and acquisitions. Terry has worked in London as Head of International Strategy and Head of Wealth management, and Europe, for the world’s largest banking group HSBC. Terry is Chairman of the Queensland Government’s i.lab Incubator Pty Ltd. He is a partner with Stephen Cantwell in The Orion Partnership, a specialist adviser on infrastructure (particularly rail), major contract/commercial structuring/strategy and negotiation, and financial structuring and loan/ investment recovery. Terry is a member of the Audit and Compliance Committee.
Appointed 1 July 2006 until 30 September 2008. Re-appointed from 1 October 2008 until 30 September 2011.
Russell ScottDirectorRussell has over 30 years’ experience in the coal and petroleum industry, with Shell and Anglo Coal Australia, and also has a strong background in finance. He is currently a Director with InterFinancial Corporate Finance Limited, working as a corporate advisor. He has direct experience in new mine development, export coal trading, negotiation of joint venture agreements, coal property divestment and acquisition and the procurement of infrastructure services for rail, port, water and electricity. Russell has a Bachelor of Economics from monash university.
Appointed 1 July 2006 until 30 September 2007. Re-appointed from 1 October 2007 to 30 September 2009.
Andrea StainesDirectorAndrea is a Non-Executive Director of Australian Rail Track Corporation and the Brisbane Royal Children’s Hospital Foundation and publicly-listed Early Learning Services. She is also a Company Advisor in the areas of strategy, risk and governance. She has a background in commercial and financial management within the aviation industry, having been co-founder and Chief Executive Officer of Australian Airlines (a Qantas subsidiary flying to and from Asia). She has a master of Business Administration from the university of michigan, and a Bachelor of Economics from the university of Queensland. Andrea is a member of the Human Resources Committee.
Appointed 1 July 2006 until 30 September 2008. Re-appointed from 1 October 2008 until 30 September 2011.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureC
orporate G
overnance
93Corporate Governance | Our Board of Directors | Gladstone Ports Corporation | Annual Report 2008–09
Tony kellyDirectorTony is currently Chairman of the Brisbane Lions AFL Football Club and Deputy Chairman of Brisbane markets Limited. He has been involved in the fresh produce industry for over 20 years including long term directorships of both the Queensland and Australian Chamber of Wholesalers. Tony holds a Bachelor of Laws degree from the university of Queensland and is married with three daughters. Tony is a member of the Audit and Compliance Committee.
Appointed 11 October 2007 until 30 September 2009.
Gail DavidsonDirectorGail has held management roles in a number of areas for over 30 years and is currently General manager Disability Services and Community Engagement– State Operations for Endeavour Foundation. Gail has been involved in the disability sector for nearly 20 years, having previously worked in the hospitality and health sectors. She is also a member of the Complaints management Quality Committee advising the minister for Disability Services and has been a member of the Disability Council of Queensland, the Gambling Community Benefit Fund, under Treasury, and was the Inaugural Chair of the Regional Disability Council of Central Queensland. Gail is a member of the Australian Institute of Company Directors and is currently continuing her masters studies through the university of Newcastle.
Appointed 1 October 2008 until 30 September 2011.
Judy ReynoldsDirectorJudy is a chartered accountant with over 20 years experience in public accounting and is a director of Sothertons Chartered Accountants. She has extensive experience in business development and strategic growth strategies working with small and medium entities (SmEs) over a wide range of sectors. Judy has chaired the National Sothertons Board and is a member of the Gladstone Economic and Industry Development Board. She has a Bachelor of Business and is a Fellow of the Taxation Institute of Australia. Judy is currently Chairman of the Audit and Compliance Committee.
Appointed 1 October 2008 until 30 September 2011.
Corporate Governance | Our management Team | Gladstone Ports Corporation | Annual Report 2008–0994
Our
man
agem
ent T
eam Leo Zussino
Chief Executive OfficerLeo’s main focus is on directing and controlling our business and operational activities, providing leadership by developing plans and strategies to ensure short and long term objectives are achieved.
In 2009–10, Leo’s priorities will centre on the planning and development of additional port facilities to meet the commitments of the expanding coal and LNG industries which will provide significant stimulus to the economy of the Gladstone region.
mike GaltCommercial General managermike is principal financial adviser to the CEO and Board, and is responsible for managing our commercial strategy, governance and risk management functions. His department also manages the port property portfolio, information systems, procurement, marina and new business functions.
In 2009–10, mike’s focus is on improving efficiency and governance of all responsible areas and establishing contractual framework for major new business activities in the ports.
Ian DruryPort Planning and Development General managerIan is responsible for all activities undertaken by the Port Planning and Development department including the full spectrum of Engineering Services associated with planning, project development and asset management of port infrastructure as well as the earthworks operational activities.
In 2009–10, Ian’s focus will be on the continuing development of future port infrastructure to cater for proposed LNG, nickel and steel projects.
mark GreenawayProject General manager and Acting Corporate Relations General managermark is responsible for the Wiggins Island Coal Terminal Project along with oversight of other major GPC projects.
As acting Corporate Relations General manager, mark has oversight of a broad spectrum of responsibilities comprising Employee Relations, Safety, Environment, Landscaping and Revegetation and Community Relations.
In 2009–10, mark’s focus will remain on increasing the Port of Gladstone’s throughput capacity by delivering infrastructure associated with the detailed design stages of the proposed Wiggins Island Coal Terminal Project.
As acting Corporate Relations General manager, mark’s focus is ensuring safety and the environment continue to be a priority through ongoing improvement programs integral to operating efficient and commercially viable port operations.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureC
orporate G
overnance
95Corporate Governance | Our management Team | Gladstone Ports Corporation | Annual Report 2008–09
1. Leo Zussino Chief Executive Officer
2. Mike Galt Commercial General Manager
3. Ian Drury Port Planning and Development General Manager
4. Mark Greenaway Project General Manager and Acting Corporate Relations General Manager
5. Craig Walker Port Operations General Manager
1 2 3
4 5
Craig WalkerPort Operations General manager Craig is responsible for the management of all cargo handling activities and associated infrastructure. This includes operating capability and performance, terminal asset management and maintenance, engineering support and service delivery improvement programs.
In 2009–10, Craig will continue to focus on operational capability and performance through the Continuous Improvement Program and Capricorn Coal Chain maximisation Project. Craig will also oversee the implementation of operational support systems and the integration and optimisation of port expansion assets, embedding our asset management plan and reliability centred maintenance system.
Corporate Governance | Corporate Governance Practices | Gladstone Ports Corporation | Annual Report 2008–0996
Cor
pora
te G
over
nanc
e P
ract
ices
Outcomes for 2008–09Reviewed and updated Board and Committee charters
Achieved 100% compliance with ASIC requirements
Assess all fraud risks
Introduced Capital Investment System
Ensured governance structure and procedures for WICT were robust
Targets for 2009–10Continue to review remaining Board and Committee charters
Achieve 100% compliance with ASIC Requirements
Introduce Capital Investment System for all projects
Board
CEO
Commercial
Port Operations
Projects
Port Planning and Development
Corporate Relations
GENERAL MANAGERS
Shareholding Ministers
Internal Audit
External Audit
Customers Community
Audit and Compliance Committee
Human Resources Committee
ORGANISATIONAL STRuCTuRE
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureC
orporate G
overnance
97Corporate Governance | Corporate Governance Practices | Gladstone Ports Corporation | Annual Report 2008–09
Corporate governance practicesOur governance framework provides the structure that ensures authority is appropriately exercised, that we are accountable for our actions – and these are aligned with government and stakeholder priorities, and provides the leadership GPC requires to:
• attainourvision
• undertakeourmission
• upholdourvalues
• efficientlyandeffectivelyachieve our goals and objectives.
Our BoardOn 13 march 2008 Central Queensland Ports Authority (CQPA) was renamed the Gladstone Ports Corporation (GPC). On 1 July 2008, GPC converted to a Company Government Owned Corporation (GOC), constituted under the provision of the Government Owned Corporations Act 1993 (GOC Act), and became Gladstone Ports Corporation Limited as part of this process. As at 30 June 2009, the shareholding ministers were the Treasurer and minister for Employment and Economic Development, and the minister for Transport.
Our Directors are appointed by the Governor in Council, pursuant to the GOC Act, on the recommendation of the shareholding ministers. GPC is required to have a minimum of three directors and any director may be removed at any time by the Governor in Council. Directors are appointed for a term of no more than five years, but may be reappointed after that time. No director is subject to retirement by rotation.
All Directors are non-executive Directors. The Corporation is committed to ensuring that all new members of the Board receive an effective induction to their Board and Committee responsibilities as well as an overview of the structure, operations, policies and processes of GPC (see Board inductions page 98).
All directors are non-Executive and this may result in a conflict of interest with GPC’s activities from time to time. Directors must declare their interests external to GPC to allow for the identification of any areas of activity that may lead to a conflict of interest. A declaration of Directors’ other interests is a standing agenda item at the commencement of every ordinary Board meeting. Directors absent themselves from meetings while any matters of potential conflict of interest are discussed, and all reference to these matters is removed from copies of their minutes and papers. In accordance with its Charter, the Board at least annually ensures that the independence criterion as set out in the Charter is satisfied for each Director.
Role of the BoardOur Board assumes overall responsibility for corporate governance practices within GPC and monitors the performance of the organisation, its management and employees. The Board, in conjunction with the Chief Executive Officer (CEO), establish and implement our operational, financial and strategic direction as outlined in our one-year (Statement of Corporate Intent 2009–2010), five-year (Corporate Plan 2009–2014) and long-term (50-year Strategic Plan 2008–2058) plans. Ongoing government, customer, community and employee consultation assists the Board to enact the strategies and attain the corporate objectives defined in these plans.
A structure that adds valueThe criteria for Board membership are in accordance with the GOC Act. This states that in appointing a person as a Director, the Governor in Council must have regard to that person’s ability to make a contribution to the statutory GOC’s commercial performance and implementation of its Statement of Corporate Intent (SCI). See pages 90–93 for our Board member’s biographies, which highlight the skills and experience they bring to the organisation.
Corporate Governance | Corporate Governance Practices | Gladstone Ports Corporation | Annual Report 2008–0998
Cor
pora
te G
over
nanc
e P
ract
ices
con
t... Directors are advised of relevant
industry related seminars and conferences, enabling them to keep their skills and knowledge current. Directors are encouraged to attend workshops and seminars as part of our continuing professional development policy that enables them to undertake their role effectively.
Board meetingsNine Board meetings were held during the year. The table on page 99 provides details of each Director’s attendance at those meetings.
The Chairman and Chief Executive Officer discuss and finalise the agenda for each meeting, which routinely includes:
• monthlyreportsonourfinancial performance
• monthlyreportsonournon-financial performance (through the Chief Executive Officer’s Report that details the activities of each division)
• monthlyreportsonexpansionprojects and new infrastructure
• commercialandgovernancedecisions requiring resolution.
In 2008–09, the Board sought and obtained agreement from the shareholding ministers to modify the Corporation’s 2008–09 Statement of Corporate Intent to incorporate revisions to its financial position to allow for the purchase of marley Brown Oval and the inclusion of additional information on sponsorship, advertising, corporate entertainment, donations and other arrangements.
Each meeting also includes presentations by GPC employees and/or invited guests. Board papers are circulated one week before the meeting to provide sufficient time for review of agenda items and enable Directors’ to request additional information to support their decision making.
The following materiality thresholds apply to the above definition of independence:
• amaterialprofessionaladvisoror consultant is one whose fees to GPC in a financial year exceed $100,000
• amaterialsupplierisonethevalue of whose sales to GPC in a financial year exceed 2% of the value of GPC’s total purchases including capital expenditure
• amaterialcustomerisonethevalue of whose purchases from GPC in a financial year exceed 2% of GPC’s gross revenue
• amaterialcontractualrelationship, other than any of those described above, is one in respect of which the consideration payable under the contract exceeds $100,000.
materiality is assessed on a case by case basis from the perspective of both GPC and the relevant Director having regard to the Director’s individual circumstances.
Induction of new members and continuing professional developmentA comprehensive Directors’ induction is carried out for new Directors appointed to the Board. Information and briefings provided to Directors includes enabling legislation, corporate planning documents, relevant policies and detail on Board administrative arrangements.
New Directors visit the site to familiarise themselves with our operations, and they are provided with an opportunity to attend the GOC Directors’ Forum organised by the Office of Government Owned Corporations. This forum, usually held on an annual basis, provides an overview of the issues, processes and practices which are specific to GOCs, ensuring our Directors possess the knowledge required to fulfil their role effectively.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureC
orporate G
overnance
99Corporate Governance | Corporate Governance Practices | Gladstone Ports Corporation | Annual Report 2008–09
Gaining independent adviceIndependent professional advice is available to the Board and individual Directors to assist them in carrying out their designated duties. This advice is provided at GPC’s expense.
Board performance reviewAs part of its governance process, the Board has committed to ensure a regular; self-review of its performance is undertaken. The Chairman conducts a review of the skills around the Board table and identifies any skills that may be required in the future. Whilst the Chairman does not himself have the right to appoint directors, it is acknowledged that shareholding ministers take skill requirements into account when appointing directors.
The performance of the Board, its Committees and individual Directors is reviewed and evaluated regularly. The review involves individual sessions between the Chairman and each Director. An external consultant is sometimes engaged to assist with the evaluation and review of board performance. Director’s attendance at 2008–09 Board meetings was in accordance with terms of appointment on the Board. In addition, several Directors attended Committee meetings on an ex-officio basis.
Board committeesThe Committees of the Board are as follows and meet a minimum of four times a year.
Audit and Compliance CommitteeThe Audit and Compliance Committee comprises Judy Reynolds (Chairman), Ian Brusasco, Tony kelly and Terry Crawford. The Committee composition was restructured from 1 January 2009 following an internal review of the skills required by the Committee. The members qualifications are included in their Directors’ biographies on pages 90 to 93. The CEO and the Commercial General manager assist the Committee. The internal and external auditors attend Committee meetings by invitation. These meetings, conducted without management representatives present, are an open forum where information is provided and concerns discussed.
GPC BOARD mEETING ATTENDANCE 2008–09
Board member Board (9 held)
Human Resources Committee
(4 held)
Audit and Compliance Committee
(3 held)Ian Brusasco 9 3 3
Charles Ware 9 2 (out of 2) 2 (out of 2)
Peter Corones 8 2 (out of 2) 1 (out of 1)
Russell Scott 8 2 (out of 2) 2 (out of 2)
Andrea Staines 7 3 2 (out of 2)
Tony kelly 8 1 (out of 2) 3
Terry Crawford 9 3 (out of 3) 3
Steven Campbell 2 (out of 2) - 1 (out of 1)
Gail Davidson 6 (out of 7) - 1 (out of 1)
Judy Reynolds 6 (out of 7) - 2 (out of 2)
Period 1 July 2008 to 30 June 2009
The Audit and Compliance Committee’s responsibilities include, but are not limited to:
• followingtheinternalauditcharter, and overseeing internal audit and compliance functions
• makingrecommendationsbased on the results of Internal Audit Reviews
• makingrecommendationsbased on the external auditors reports
• reviewingandapprovingtheannual financial statements
• overseeingourethicalconductand governance functions.
The Audit and Compliance Committee operates under a charter established by the Board. During 2008–09 the Audit Committee observed the terms of its charter with due regard to Queensland Treasury’s Audit Committee Guidelines.
Achievements in 2008–09The Audit and Compliance Committee has monitored management’s performance and internal audit reports from Ernst and Young and Deloitte Touche Tohmatsu. In addition, it has reviewed management’s performance in relation to external auditor reports. It has also been involved in addressing a number of other Corporate Governance matters.
Corporate Governance | Corporate Governance Practices | Gladstone Ports Corporation | Annual Report 2008–09100
1. Business Development Coordinator, Lee Jorgensen (facing) and Corporate Services Manager, Geoff White.
2. RGTCT Administration Assistant, Andrew Schultz and Employee Relations Advisor, Ged Melrose approach RGTCT’s new Corporate Relations administration building.
12
Human Resources CommitteeThe Human Resources Committee comprises Ian Brusasco (Chairman), Andrea Staines, Charles Ware and Peter Corones. The Committee was restructured from 1 January 2009, following an internal review of the Committee’s skill requirements. The Committee was assisted by the CEO, the Commercial General manager and the Corporate Relations General manager.
The Committee’s responsibilities include, but are not limited to:
• monitoringandimplementingrecommendations relating to salaries and enterprise agreements
• reviewingreportsandoverseeing the implementation of recommendations arising from audits and reviews of systems and processes
• providingstrategicdirectionfor human resource management, training, planning and development
• makingrecommendationsto the Board on remuneration issues.
Cor
pora
te G
over
nanc
e P
ract
ices
con
t...
Achievements in 2008–09The Human Resources Committee continued to review and approve GPC’s strategic plans for Health and Safety. The progress of working groups developed as part of the Certified Agreement negotiations has been monitored by the committee along with the progress of training and development initiatives throughout GPC.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureC
orporate G
overnance
101Corporate Governance | Corporate Governance Practices | Gladstone Ports Corporation | Annual Report 2008–09
Performance based paymentsFor Senior managementThe senior executive performance scheme provides a bonus payment up to 15% of base salary (maximum). This is calculated by assessing achievement of key organisational and departmental goals measured against kPI targets for safety, production, financial performance, community satisfaction, maintenance performance and project completion.
This evaluation is part of each senior executive’s performance plan, with each Senior Executive developing a performance plan focused on achieving key organisational and departmental goals; the CEO and the Board approve performance plans. These plans are reviewed six-monthly and assessed after 12 months. The award of a performance payment is subject to Board approval.
Internal auditThe Audit and Compliance Committee defines the internal auditors’ scope of work through establishment of an annual internal audit plan. It also reviews the reports of the internal auditors, and assesses their quality of work. Ernst & Young conducted our internal audit functions until 31 December 2008. Following a restricted tender process Deloitte Touche Tohmatsu were appointed as internal auditors for three years until 31 December 2011. Internal audit is an independent function that assists the Board and management in the effective discharge of their responsibilities.
Remuneration arrangementsFor the BoardDirectors’ remuneration is determined by resolution at a General meeting of GPC and the 2008–09. Details of Directors’ remuneration are disclosed in the Notes to the Accounts in accordance with GOC’s remuneration disclosure requirements (see Note 25 – page 151).
For Senior managementSenior Executive remuneration is determined in accordance with GOC Governance Arrangements for Chief and Senior Executives.
Proposed remuneration is reviewed by the Board and advised to shareholding ministers. This approach seeks input and feedback, ensuring that our shareholding ministers are satisfied that remuneration arrangements are appropriate. Remuneration arrangements are based on the role and associated responsibilities. Detail of Senior Executives’ remuneration is disclosed in the Note 25 of our Accounts (see page 152).
Achievements in 2008–09
The 2008–09 internal audit plan included reviews of:
• NavisionandWestpacapplication security
• RGTCTexpansioncomplianceand monitoring
• follow-upofpriorinternalauditrecommendations
• operationsperformancetesting
• disasterrecoverytesting
• WigginsIslandCoalTerminal Project
• ProcuretoPaymentReview
• riskmanagementframeworkhealth check.
The audit reports were submitted to the Audit and Compliance Committee for consideration and assessed for subsequent implementation of their recommendations.
External audit arrangementsIn accordance with the GOC Act and the Financial Administration and Audit Act 1977 our external auditor is the Queensland Audit Office.
Dividend policyOur dividend policy takes into account the return that shareholders expect from their investment and the ongoing capital investment requirements of our business. In 2008–09, the Board recommended a shareholder dividend payment of 80% of after tax profit, adjusted for any unrealised movements from the revaluation of non-current assets.
Corporate Governance | Corporate Governance Practices | Gladstone Ports Corporation | Annual Report 2008–09102
Cor
pora
te G
over
nanc
e P
ract
ices
con
t... Communicating
ethical standardsDetails of our ethical standards such as the Code of Conduct, Fraud, Corruption and Official misconduct Policy, Whistleblowers and Risk management Policy, and the means by which we implement them, form part of the induction policy for all new Board members and employees. updates are provided as new policy developments occur and as part of our CEO’s annual business update sessions. Policies are available on the GPC internal website.
Code of ConductWe have a comprehensive Code of Conduct, developed and formally adopted by the Board. The Code details Board members’ and employees’ responsibilities and their accountability to investigate and report unethical practices. It provides examples that illustrate application of the Code. Annual business update sessions presented by the CEO provide a reminder to us of our obligations. Our code is underpinned by the requirements of the Public Sector Ethics Act 1994.
Fraud, Corruption and Official misconduct PolicyThe Fraud, Corruption and Official misconduct Risk management Policy applies to all Board Directors and our employees. The policy was developed to assist management and employees in the discharge of their responsibilities by setting out the procedures for managing fraud, corruption and official misconduct risk. The Corporate Services manager is the Fraud Control Officer for the purposes of the policy. All incidences of theft and related activity are reported to the Audit Committee by the Fraud Control Officer on a regular basis for consideration of fraud control initiatives. Employees are also reminded of their obligations under this policy at the annual business update sessions.
Whistleblowers Protection Actunder our Code of Conduct, all GPC employees are required to report any reasonably based suspicion of fraud, corruption and maladministration to their managers, another appropriate officer of GPC, a member of the Board or through the GPC Hotline (1800 063 408) consistent to the requirements of the Whistleblowers Protection Act 1994. While the GPC Hotline is intended primarily to be a service for employees, contractors and customers of GPC, the same reporting channel is available for the community to raise issues and concerns. No calls to the Hotline will be dismissed on the basis of their source. The service is provided by our internal auditors. No calls about fraud, corruption or maladministration matters were received on our Hotline during the year. Where calls were received about other matters, these were redirected to the relevant departments for action.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureC
orporate G
overnance
103Corporate Governance | Corporate Governance Practices | Gladstone Ports Corporation | Annual Report 2008–09
Risk management policyOur Board retains ultimate responsibility for risk management and for determining the appropriate level of risk that the Board is willing to accept in the conduct of our business activities. The CEO provides the interface between the business units and the Board. Overall, the CEO has the ultimate responsibility for maintaining a robust corporate risk management system within GPC that delivers reports to the Board reflecting the true state of exposures to our business. GPC is committed to:
• behavingasaresponsiblecorporate citizen, protecting employees, customers, contractors and their property, as well as the community and the broader environment from unnecessary injury, loss or damage
• achievingourbusinessobjectives by minimising the impact of risks we can meaningfully and realistically control which would significantly affect our assets and earnings
• findingtherightbalancebetween the cost of control and the risks we are willing to accept as the legitimate grounds for earning reward. Supervisors must ensure that as new risks are identified, or current risks are removed, the Business Risk Database is updated and communicate the risks to their respective business units
• aformalreviewofeachbusiness unit’s risks must also be conducted by supervisors at least once a year as part of the business planning and budgeting process. These reviews consider the completeness of the risks identified, the accuracy of assessments, and review the effectiveness and continued operation of identified controls and accountabilities.
The principles behind this policy are based on the Australian and New Zealand Standard AS/NZS 4360:2004 Risk Management.
Summary of directions and notifications given under the GOC ActNo directions or notifications were received from the Queensland Government during the 2008–09 financial year.
Corporate Governance GuidelinesThe Queensland Government Corporate Governance Guidelines for GOCs – September 2005 (‘the guidelines’) summarise the expectations of shareholding Ministers in relation to the corporate governance of all Queensland GOCs established under the GOC Act.
The guidelines, commenced in the 2005–06 financial year, apply to subsequent financial years. With the assistance of Ernst & Young, in 2008 we conducted a gap analysis of our corporate governance policies, procedures, processes and related documents against the 10 principles outlined in the guidelines. The exercise led to the development of new charters and policies and amendments to existing documents (e.g. Code of Conduct) to address the recommendations contained within the guidelines. The guidelines outline reporting requirements including making publicly available specified charters, policies and statements (for example on the GPC website or in the annual report).
Our Corporate Governance policies are available at: http://www.gpcl.com.au/corporate.html.
Records managementGPC is aware of its responsibilities under the Public Records Act 2002 and is formulating strategies in line with ISO 40 Record-keeping used under the Financial Administration and Audit Act 1977 to improve record-keeping practices. This will ensure that operational business needs, legal, evidential and accountability requirements are met and stakeholder expectations are fulfilled.
Corporate entertainment and hospitalityWith the exception of the opening of the RGTCT Expansion Project ($128,625), GPC did not incur any expenses in excess of $5,000 on any event during 2008–09. The opening of the RGTCT Expansion Project was factored into the construction cost of the project.
Corporate Governance | Financial Review | Gladstone Ports Corporation | Annual Report 2008–09104
Fina
ncia
l Rev
iew
Our final dividend increased by 23.4% to $33.2m as a result of the increased revenue from cargo handling. Pictured – Coal is unloaded on to one of 21 stockpiles at RGTCT.
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
InfrastructureC
orporate G
overnance
105Corporate Governance | Financial Review | Gladstone Ports Corporation | Annual Report 2008–09
StAtEmEnt oF CoRPoRAtE IntEnt (SCI) 2009 – KEy PERFoRmAnCE IndICAtoRS
Key performance indicators Actual result target Variance actual to target (%)
Revenue ($m) 307.3 282.1 8.9
operating expenses (including depreciation) ($m) 196.4 202.2 (2.9)
EBIt ($m) 110.9 79.9 38.8
Cash from operations ($m) 114.3 120.9 (5.5)
Return on assets (%) 7.3 5.7 28.1
Return on equity (%) 7.0 3.9 97.4
debt/equity ratio (%) 61.0 34.2 78.4
Current ratio (times) 4.6 1.0 360.0
Interest cover (times) 3.6 2.3 56.5
tonnes (million) 79.4 86.0 (6.6)
Statement of Corporate Intent (SCI) 2008–09 GPC experienced very good results, with the main exception being tonnage throughput, in relation to the targets listed in the SCI for 2008–09:
outcomes 2008–09After tax profit of $55.6 million achieved
dividend of $33.2 million ($26.9 million 2007–08) provided (80% of after tax profit after adjusting for revaluation of assets and removal of the impact of the purchase of the marley Brown oval for the Gladstone community)
7.3% EBIt return on assets achieved
targets 2009–10Achieve after tax profit of $37.7 million
Provide a dividend of $30.1 million (80% of after tax profit)
Achieve 5.8% EBIt return on assets
Corporate
Governance
Corporate Governance | Financial Review | Gladstone Ports Corporation | Annual Report 2008–09106
Fina
ncia
l Rev
iew
con
t...
Total revenue exceeded budget by $25.2 million. This was primarily due to the impact of the cargo handling agreement for coal. In addition, the revaluation increases of $14.8 million were not budgeted. However, recoverable works was $8.6 million below budget due to works to be undertaken for Rio Tinto in relation to the expansion of their Yarwun alumina refinery being delayed into 2009–10.
REvENuE
Performance against budget
250
200
150
100
50
0
$ m
illion
s (’0
00)
Actual
Budget
Revenue category
Car
go
hand
ling
vess
el
hand
ling
Har
bour
du
es
Inte
rest
Rev
alua
tions
Pro
pert
y in
com
e
Rec
over
able
w
orks
Oth
er
202.
029
37.3
3338
.672
35.5
03
3.06
5
0
2.61
1
13.3
00
4.19
334.0
98
6.96
3
14.7
49
4.85
4
4.72
1
2.57
0
184.
763
$ m
illion
s (’0
00)
Expense category
EXPENSES
90
80
70
60
50
40
30
20
10
0
Actual
Budget
Expenses were under budget by $5.8 million. Energy costs were $3.3 million under budget due to the drop in cost of diesel. However, this was offset by impairments (refer to Note 8e of the financial statements) of $4.0 million which were not budgeted for. Finance costs were 8.4% below budget as a result of depressed interest rates following the global financial crisis. Depreciation was in line with budget.
Ope
ratio
nal
71.0
58 79.1
64
Em
ploy
ee77
.922
78.9
53
Fina
nce
31.6
48
34.5
68
Dep
reci
atio
n43
.397
44.1
11
Impa
irmen
t3.
960
0
Dev
alua
tions
0.43
0
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
Corporate Governance | Financial Review | Gladstone Ports Corporation | Annual Report 2008–09 107
EBIT was 35.7% higher than budgeted in 2008–09. This was primarily derived from revenue under the coal handling agreement and asset revaluations.
PROFITABILITY
EBIT
140
120
100
80
60
40
20
0
$ m
illion
s (’0
00)
Actual
Budget
81.7
6352
.221
EBITDA
119.
018
94.8
01
Financial trend analysis
FINANCIAL TREND ANALYSIS TO 30 JuNE 2009
2009
$m
2008
$m
2007
$m
2006
$m
2005
$m
Income statementOperating revenue 292.6 255.7 193.9 151.9 135.5
Revaluations 14.7 9.8 30.2 - -
Operating expenses including employee expenses
149.0 142.6 119.4 105.5 96.7
Depreciation 43.4 37.3 24.9 21.5 17.9
Impairment/devaluations 4.0 3.8 26.2 - -
EBIT 110.9 81.8 53.6 24.9 20.9
Finance costs 31.6 26.0 14.5 10.5 9.4
Income tax expense 23.7 16.7 11.7 4.2 3.3
NPAT 55.6 39.0 27.4 10.2 8.2
Dividends provided for 33.2 26.9 5.0 7.0 5.6
Balance sheetTotal assets 1,611.0 1,443.8 1,252.2 1,052.3 651.6
Total liabilities 747.5 623.3 493.3 330.0 232.5
Net assets/shareholders equity 863.5 820.5 758.9 722.3 419.1
Revenue compositionHarbour dues 34.1 31.4 30.0 27.1 26.1
Tonnage rates 30.0 26.3 20.1 13.6 12.6
Other shipping 7.3 6.7 5.5 4.9 3.4
Handling charges 202.0 173.3 123.1 93.9 83.8
Property rentals 4.9 2.9 2.9 2.2 2.0
Smallcraft 1.8 1.6 2.9 3.0 2.6
Interest 7.0 2.4 7.2 3.9 3.5
Other 5.5 11.1 2.2 1.6 1.6
Revaluations 14.7 9.8 30.2 - -
Total 307.3 265.5 224.1 151.9 135.5
1. Gladstone’s Marina with RGTCT in background.
1
Corporate Governance | Financial Review | Gladstone Ports Corporation | Annual Report 2008–09108
Fina
ncia
l Rev
iew
con
t... Financial Performance 5-Year Analysis
REvENuE
Revenue excluding revaluations has increased significantly over the last four years. All categories of commercial shipping revenue have grown over this period. 2006–07 saw the first revaluation of assets under IFRS and 2007–08 and 2008–09 again saw increases in asset values.
2005
-06
2004
-05
2006
-07
2007
-08
2008
-09
350
300
250
200
150
100
50
0
$ m
illion
s (’0
00)
Revaluations
Other
Interest
Smallcraft
Property income
Handling charges
Other shipping
Tonnage rates
Harbour dues
Financial year
26.089 27.131
12.565 13.640 20.121 26.283 29.985
30.036 31.437 34.098
88.821 93.880 123.094173.272 202.029
1.9562.162
2.946
4.854
3.368 4.864 5.527 6.690 7.348
2.5892.982
2.920
1.754
3.5013.856
7.193
6.963
1.5891.556
1.983
5.537
30.239
14.749
2.8891.5852.420
11.1319.836
2005
-06
2004
-05
2006
-07
2007
-08
2008
-09
Financial year
250
200
150
100
50
0
EXPENSES
$ m
illion
s (’0
00)
Other
Finance
Impairment and devaluations
Depreciation
Operational
Employee
Expenses have shown a steady rise as the business has grown. The 2008–09 figures have increased partly due to increased wages costs as the number of our employees rose from 606 to 646. Finance costs have shown a steady increase as a result of the RGTCT Expansion Project borrowings. These borrowings were fully drawn at 30 June 2008, with 2008–09 being a full year with the current borrowing level.
45.386 51.905 59.901 69.333 77.922
50.751 53.584 59.335
73.13871.058
9.42410.641
26.246
3.7713.960
0.043
14.473
26.03131.648
17.92521.492
24.862
37.255 43.397
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
Corporate Governance | Financial Review | Gladstone Ports Corporation | Annual Report 2008–09 109
EBIT SummARY
EBIT increased by 35.7% in 2008–09. This has mainly been a result of the impact of the cargo handling agreement and asset revaluations.
120
100
80
60
40
20
0
$ m
illion
s (’0
00)
Financial year
2004
-05
20.8
56
2005
-06
24.8
59
2006
-07
53.6
06
2007
-08
81.7
63
2008
-09
110.
937
Financial year
2004
-05
2005
-06
2006
-07
2007
-08
2008
-09
NPAT SummARY
NPAT has shown significant increases over the last four years as the business continues to expand. The 2008–09 increase was mainly due to the impact of the coal cargo handling agreement and the effect of revaluations of assets.
60
50
40
30
20
10
0
$ m
illion
s (’0
00)
8.16
4
10.1
99
27.3
98
39.0
32
55.6
20
The 2008–09 dividend is a substantial increase on previous years as we look to return greater profits to Shareholders (2008–09: 8.93c/share, 2007–08: 7.22c/share). Our income tax payable continues to increase as profits rise.
TAXES AND DIvIDENDS SummARY
2004
-05
2005
-06
2006
-07
2007
-08
2008
-09
Competitive neutrality fee
Land tax
Income tax
Dividends
60
50
40
30
20
10
0
$ m
illion
s (’0
00)
Financial year
5.619 7.023 4.980 26.880 33.243
0.200 0.1000.200
0.038
0.281
6.152
15.013
1.146 1.2121.069
2.467
2.467
Corporate Governance | Financial Review | Gladstone Ports Corporation | Annual Report 2008–09110
Fina
ncia
l Rev
iew
con
t...
Total assets have shown significant increases over the last four years as a result of the RGTCT Expansion Project. We are committed to delivering facilities that enable Central Queensland business to continue to grow and increase imports and exports to the region. Our asset value increased by a further $43.8 million (net) following revaluation of all GPC assets in 2009.
$ m
illion
s (’0
00)
1,800
1,600
1,400
1,200
1,000
800
600
400
200
0
Financial year
2004
-05
651.
600
2005
-06
1,05
2.30
0
2006
-07
1,25
2.20
0
2007
-08
1,44
3.80
3
2008
-09
1,61
0.99
6
TOTAL ASSETS
Capital expenditure of $109.5 million was incurred in 2008–09 as we finalised the RGTCT Expansion Project. Significant additional capital expenditure is forecast in the next five years as new projects commence around the Port of Gladstone.
CAPITAL EXPENDITuRE
450
400
350
300
250
200
150
100
50
0$
milli
ons
(’000
)
Financial year
2004
-05
39.7
00
2005
-06
250.
600
2006
-07
407.
800
2007
-08
139.
949
2008
-09
109.
538
No equity injections or repatriations occurred in 2008–09. The asset revaluation reserve increased by $20.3 million in 2008–09, as a result of the revaluation of our assets. Retained profits have also continued to increase steadily over the last five years to $76.7 million in 2008–09.
SHAREHOLDER EQuITY
Financial year
2004
-05
2005
-06
2006
-07
2007
-08
2008
-09
1,000
900
800
700
600
500
400
300
200
100
0
$ m
illion
s (’0
00)
Net assets upon restructure
Retained profits
Asset revaluation reserve
Contributed equity
372.452 675.943 675.943 725.943
27.035
27.176 41.28940.583 60.909
725.943
3.49116.161
19.196 41.69253.924 76.672
FinancialsC
orporate G
overnanceP
eopleC
omm
unityE
nvironment
Infrastructure
Corporate Governance | Financial Review | Gladstone Ports Corporation | Annual Report 2008–09 111
INTEREST BEARING LIABILITY
Interest bearing liabilities have increased by $93.2 million as a result of the Wiggins Island Coal Terminal Full Feasibility and Detailed Design Project. This borrowing will continue in 2009–10 up to $140 million.
$ m
illion
s (’0
00)
600
500
400
300
200
100
0
Financial year
2004
-05
140.
124
2005
-06
207.
475
2006
-07
346.
769
2007
-08
454.
769
2008
-09
547.
994
RETuRN ON EQuITY
Return on equity continued to increase in 2008–09. We expect that this will continue to improve as all assets from the RGTCT expansion ramp up to nameplate capacity and begin to generate a return.
9
8
7
6
5
4
3
2
1
0
Per
cent
age
(%)
2.22
0
1.79
0
3.70
0
5.56
8
7.66
2
Return on assets saw continued improvement in 2008–09 as we work toward increasing the returns through improved productivity and asset utilisation.
RETuRN ON ASSETS
Per
cent
age
(%)
Financial year Financial year
8
7
6
5
4
3
2
1
020
04-0
5
2004
-05
3.50
0
2005
-06
2005
-06
2.90
0
2006
-07
2006
-07
4.70
0
2007
-08
2007
-08
6.06
5
2008
-09
2008
-09
7.26
3
1. A visitor to Auckland Point Lookout views the activities of RGTCT.
2. Coal is loaded onto one of BPCT’s stockpiles.
12
Coal exports for 2008–09 totalled a record 56.2Mt, an increase of 2.1Mt on 2007–08. Pictured: Dozers spread coal towards the stockpile reclaim pit during shiploading.
Financials 113
Financials Index 114
Directors’ Report 115
Financial Statements 120
Financials | Gladstone Ports Corporation | Annual Report 2008–09 113
Fina
ncia
ls
Financials
Financials | Financials Index | Gladstone Ports Corporation | Annual Report 2008–09114
Fina
ncia
ls In
dex Directors’ report 115
Auditor’s independence declaration 119
Income statement 120
Balance sheet 121
Statement of changes in equity 122
Cash flow statement 123
Notes to the financial statements
1. General 124
2. Summary of significant accounting policies 125
3. Profit from operating activities 132
4. Income tax equivalent 133
5. Cash and cash equivalents 135
6. Trade and other receivables 135
7. Inventories of maintenance and operations spares 136
8. Property, plant and equipment 137
9. Intangible assets 140
10. Investment properties 141
11. Trade and other payables 142
12. Loans and borrowings 142
13. Provisions 143
14. Employee benefits 143
15 Provision for demolition 144
16. Dividends 144
17. Provision for deferred maintenance 144
18. Provision for financial instruments 144
19. Contributed equity 145
20. Notes to the statement of cash flows 145
21. Financial risk management objectives and policies 146
22. Derivative financial instruments 149
23. Commitments 149
24. Auditors’ remuneration 149
25. key management personnel disclosures 150
26. Aggregate performance payments 154
27. Segment information 154
28. Contingent assets and liabilities 154
29. Change of name and conversion to Company Government Owned Corporation 155
30. Events occuring after balance sheet date 155
31. Wiggins Island Coal Terminal Project 155
32. Number of employees 155
Certification of annual financial statements 156
Directors’ declaration 157
Independent auditor’s report 158
Purpose and scope
Gladstone Ports Corporation Limited (GPC) is a Company Government Owned Corporation (GOC), constituted on 1 July 2004 under the provisions of the Government Owned Corporations Act 1993 (the Act). GPC converted to a company GOC on 1 July 2008, under the provisions of the Act. under the terms of s128 of the GOC Act, the Financial Administration and Audit Act 1977 applies to GPC as if it were a statutory body.
These statements have been prepared:
(i) to comply with the provisions of the Corporations Act 2001, and other prescribed requirements; and
(ii) to comply with the provisions of the Financial Administration and Audit Act 1977 and other prescribed requirements; and
(iii) to communicate information concerning GPC’s financial performance for the year and its financial position at year end.
The statements are general purpose in nature and provide a full presentation of all of the financial activities of GPC.
The financial report of Gladstone Ports Corporation Limited for the year ended 30 June 2009 was authorised for issue in accordance with a resolution of the Directors on 28 August 2009.
Directors’ report | Gladstone Ports Corporation | Annual Report 2008–09 115
The Board comprises non-executive directors who have a diversity of business experience as well as community responsibilities. The criteria for membership of the Board are in accordance with the Act. The Act requires that, in appointing a person as Director, the Governor in Council must have regard to that person’s ability to make a contribution to the Corporation’s commercial performance and implementation of its Statement of Corporate Intent (SCI). Directors are appointed for a term of not more than five years but may be reappointed.
The Directors submit their report for the year ended 30 June 2009.
Directors
The names and details of the Company’s directors in office during the financial year and until the date of this report are as follows. Directors were in office for this entire period unless otherwise stated.
Chairman Ian Brusasco AM, PHc
Ian Brusasco was appointed as Chairman on 1 February 2007. Appointed as Chairman from 1 February until 31 January 2009; reappointed from 2 February 2009 until 30 September 2010. In addition to being Chair of the Board, Ian is also Chair of the Human Resources Committee and a member of the Audit and Compliance Committee.
Ian is currently Chairman of WorkCover Queensland, Chairman of Foodbank (Qld) Pty Ltd and has served as a Director on the Queensland Investment Corporation Board. Ian is a pharmaceutical chemist and partner in two pharmacies. He has extensive commercial and community involvement through numerous directorships and executive roles over the last 45 years. Ian was awarded Member, General Division of the Order of Australia (AM) in 1988 and received the Centenary Medal in 2003. He was also inaugurated into the Australian Soccer Hall of Fame in 1999 after serving in numerous roles within the sport including: Chairman of Australian Soccer Federation, President of Queensland Soccer Federation, Vice President and Executive Member of Oceania Football Confederation, and Chairman of Olympic Football Taskforce.
Deputy Chairman Charles Ware, BA LL.B (Hons), MBus (Pub Mgt) LL.M, FAICD, MLGMA
Charles Ware assumed the role of Deputy Chairman on 27 September 2007. Appointed 1 July 2004 until 30 June 2007; re-appointed on 1 July 2007 until 30 September 2010. Charles is a member of the Human Resources Committee.
Charles is a legal consultant in a private legal practice in Central Queensland. He previously served as Chair of the Rockhampton Port Authority and has held several Board positions in the corporatised Queensland electricity supply industry. Charles is a member of the Board of Professional Engineers of Queensland and the Residential Tenancies Authority. He is also Deputy Chancellor of Central Queensland University. Charles holds undergraduate degrees in Arts and Law and Masters Degrees in Business and Law. He holds a current practising certificate as a solicitor.
Peter Corones AM
Appointed 1 July 1994 for two years and extended to 30 June 1999. Re-appointed in 1999 until 30 June 2003; re appointed in 2003 to 30 June 2005; re-appointed in 2005 to 30 September 2007 and re-appointed in 2007 to 30 September 2009. Peter is a member of the Human Resources Committee.
Peter has over 20 years’ experience in local government, recently he retired after two (2) terms as a Councillor and four (4) terms as Mayor of Gladstone City Council. A business proprietor and company director for more than 30 years, he has a long track record of extensive business and community involvement. He is a member of the Gladstone Economic and Industry Development Board, and a member of the Central Qld University Gladstone Advisory Committee.
Peter received the Centenary Medal in January 2001 and was awarded Member, General Division of the Order of Australia (AM) in January 2009.
Terry Crawford, B. Econ, LL.B, MAICD (Graduate SIA, Barrister at Law)
Appointed 1 July 2006 until 30 September 2008; re-appointed from 1 October 2008 until 30 September 2011. Terry is a member of the Audit and Compliance Committee.
With degrees in economics and law, Terry brings over 28 years experience in banking, investment banking, corporate advisory, mergers and acquisitions. Terry has worked in London as Head of International Strategy and Head of Wealth Management, and Europe, for the world’s largest banking group HSBC. Terry is Chairman of the Queensland Government’s i.lab Incubator Pty Ltd. He is a partner with Stephen Cantwell in The Orion Partnership, a specialist adviser on infrastructure (particularly rail), major contract/commercial structuring/strategy and negotiation, and financial structuring and loan/ investment recovery.
Directors’ report for the year ended 30 June 2009
Directors’ report | Gladstone Ports Corporation | Annual Report 2008–09116
Directors’ report cont...for the year ended 30 June 2009
Russell Scott, B.Econ, GAICD
Appointed 1 July 2006 until 30 September 2007; re-appointed from 1 October 2007 to 30 September 2009.
Russell has over 30 years’ experience in the coal and petroleum industry, with Shell and Anglo Coal Australia, and also has a strong background in finance. He is currently a Director with InterFinancial Corporate Finance Limited, working as a corporate advisor. He has direct experience in new mine development, export coal trading, negotiation of joint venture agreements, coal property divestment and acquisition and the procurement of infrastructure services for rail, port, water and electricity. Russell has a Bachelor of Economics from Monash University.
Andrea Staines, B.Econ, MBA, GAICD
Appointed 1 July 2006 until 30 September 2008; re-appointed from 1 October 2008 until 30 September 2011. Andrea is a member of the Human Resources Committee.
Andrea is a Non-Executive Director of Australian Rail Track Corporation and the Brisbane Royal Children’s Hospital Foundation and publicly-listed Early Learning Services. She is also a Company Advisor in the areas of strategy, risk and governance. She has a background in commercial and financial management within the aviation industry, having been co founder and Chief Executive Officer of Australian Airlines (a Qantas subsidiary flying to and from Asia). She has a Master of Business Administration from the University of Michigan and a Bachelor of Economics from the University of Queensland.
Tony Kelly, LL.B
Appointed 11 October 2007 until 30 September 2009. Tony is a member of the Audit and Compliance Committee.
Tony is currently Chairman of the Brisbane Lions AFL Football Club and Deputy Chairman of Brisbane Markets Limited. He has been involved in the fresh produce industry for over 20 years including long term directorships of both the Queensland and Australian Chamber of Wholesalers. Tony holds a Bachelor of Laws degree from the University of Queensland.
Gail Davidson, MAICD
Appointed 1 October 2008 until 30 September 2011.
Gail has held management roles in a number of areas for over 30 years and is currently General Manager Disability Services and Community Engagement – State Operations for Endeavour Foundation. Gail has been involved in the disability sector for nearly 20 years, having previously worked in the hospitality and health sectors. She is also a member of the Complaints Management Quality Committee advising the Minister for Disability Services and has been a member of the Disability Council of Queensland, the Gambling Community Benefit Fund, under Treasury, and was the Inaugural Chair of the Regional Disability Council of Central Queensland. Gail is a member of the Australian Institute of Company Directors and is currently continuing her Masters studies through the University of Newcastle.
Judy Reynolds B.Bus, CA, FTIA, MAICD
Appointed 1 October 2008 until 30 September 2011. Judy is currently Chairman of the Audit and Compliance Committee.
Judy is a chartered accountant with over 20 years experience in public accounting and is a director of Sothertons Chartered Accountants. She has extensive experience in business development and strategic growth strategies working with small and medium entities (SME’s) over a wide range of sectors. Judy has chaired the National Sothertons Board and is a member of the Gladstone Economic and Industry Development Board. She has a Bachelor of Business and is a Fellow of the Taxation Institute of Australia.
Steven Campbell
Appointed 1 July 2005 until 30 September 2008. Steven is the founder and director of Campbell Dynamics. He has extensive experience in project development and finance, and has been a member of Stanwell Corporation Limited Board. Steven holds Bachelor degrees in Engineering and Economics, and a Masters Degree in Business Administration. He is a Fellow of the Institute of Engineers Australia, the Institute of Chemical Engineers, and is a member of the Australia Institute of Mining and Metallurgy.
Company Secretary
Dr Peter Sharpe BSc (Hons), PhD, Grad Dip AppCorpGov, FCIS, CA, ACA
Peter has over 14 years experience as a Chartered Accountant in both Australia and the UK. He has been Company Secretary of GPC since March 2007. Peter has an honours degree in Biology from Portsmouth University, a PhD in Microbiology from Imperial College, University of London, is a Fellow of the Institute of Chartered Secretaries and Administrators, A Fellow of Chartered Secrataries Australia, a member of The Institute of Chartered Accountants in Australia and a member of the Institute of Chartered Accountants in England and Wales.
Directors’ report | Gladstone Ports Corporation | Annual Report 2008–09 117
Directors’ report cont...for the year ended 30 June 2009
Principal activities
Our primary role is to:
(a) provide import and export shipping infrastructure to the Central Queensland region through the Port of Gladstone and Port Alma Shipping Terminal, and encourage the use of these facilities for the economic benefit of stakeholders; and
(b) manage cargo handling facilities for coal and other bulk products at Port Alma Shipping terminal, RG Tanna Coal Terminal, Barney Point Coal Terminal and Auckland Point facilities;
(c) Develop, manage and lease land and other assets for port related purposes; and
(d) Manage ancillary services and functions which support core business activities.
Operating results for the year
The Corporations net profit after income tax is $55.6 million (2008: $39.2 million) representing an increase of 41.7% from the previous year. All profits are from continuing operations.
Auditor independence
A copy of the Auditors’ Independence Declaration as required under section 307C of the Corporations Act 2001 is set out on page 8.
Dividends
Dividends paid to shareholders during the financial year were as follows:
2009 2008
$’000 $’000Dividends paid from prior year profits 26,880 4,980
Cents per share
Cents per share
Dividend per share 7.22 1.34
In addition to the above dividends, Directors recommend the payment of a final dividend at 80% of profits, as adjusted for revaluations and the impact of the purchase of Marley Brown Oval for the Community of Gladstone. The final dividend amounts to $33,242,574 (8.93 cents per share).
Review of financial conditions
It is anticipated that GPC’s major cargo, coal will see an increase in export tonnages during 2009/10 as the global financial crisis begins to ease and following the emergence of new markets in China and India. Other port trade is expected to remain in line with that achieved in 2008-09.
Significant changes in the state of affairs
There have been no significant changes in the state of affairs.
Likely developments and expected results/matters subsequent to end of financial year
On 2 June 2009 the Queensland Premier announced that GPC would be taking over control of the Port of Bundaberg from Port of Brisbane Corporation. It is anticipated that this will occur during 2009–10. The implications of this direction are not known at this time. Consequently, the impact of the transactions cannot be estimated.
On 31 July 2009 GPC’s Board approved a resolution to repatriate $90 million of issued capital to shareholders in December 2009 from equity provided for expansion works provided between 2005 and 2008.
Environmental regulation
GPC’s operations are subject to significant environmental regulations under both Commonwealth and State legislation. Refer to comments under the heading “Environment” of the 2008–09 annual report.
Indemnification and insurance of directors and officers
During the financial year GPC indemnified all directors in respect of Directors and Officers liability and company reimbursement insurance.
Under the policy the insurer agrees to pay:
(a) all losses which each insured person becomes legally obligated to pay on account of any claims for wrongful acts;
(b) all losses for which the company may grant indemnification to each insured person.
Directors’ attendance at Board and Committee Meetings
Board (9 held)
Human Resources Committee
(4 held)
Audit and Compliance Committee
(3 held)
Ian Brusasco 9 3 3
Charles Ware 9 2 (out of 2) 2 (out of 2)
Peter Corones 8 2 (out of 2) 1 (out of 1)
Russell Scott 8 2 (out of 2) 2 (out of 2)
Andrea Staines 7 3 2 (out of 2)
Tony Kelly 8 1 (out of 2) 3
Terry Crawford 9 3 (out of 3) 3
Steven Campbell 2 (out of 2) - 1 (out of 1)
Gail Davidson 6 (out of 7) - 1 (out of 1)
Judy Reynolds 6 (out of 7) - 2 (out of 2)
Directors’ interests
The directors have no interest in any shares of GPC as all shares are held for the benefit of the State of Queensland by Ministers of the Crown.
Risk management
GPC, in carrying out its business, maintains a risk management philosophy that appropriately:
(a) protects the wellbeing of GPC’s workforce, the wider community in which it operates and its physical environment; and
(b) manages threats that could adversely affect GPC’s ability to meet its corporate objectives, its growth in shareholder value and its stewardship of company assets.
Committee membership
At the date of this report GPC had an Audit and Compliance Committee and a Human Resources Committee.
Audit and Compliance Committee: Human Resources Committee:
Judy Reynolds – Chair Ian Brusasco AM Tony Kelly Terry Crawford
Ian Brusasco AM – Chair Peter Corones AM Charles Ware Andrea Staines
Signed in accordance with a Resolution of the Directors.
I Brusasco amChairman
Directors’ report | Gladstone Ports Corporation | Annual Report 2008–09118
Directors’ report cont...for the year ended 30 June 2009
Auditor’s independence declaration | Gladstone Ports Corporation | Annual Report 2008–09 119
Auditor’s independence declarationfor the year ended 30 June 2009
28 August 2009
To the Directors of Gladstone Ports Corporation Limited:
This audit independence declaration has been provided pursuant to s.307C of the Corporations Act 2001.
As lead auditor for the audit of Gladstone Ports Corporation Limited for the year ended 30 June 2009, I declare that, to the best of my knowledge and belief, there have been:
(a) No contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(b) No contraventions of any applicable code of professional conduct in relation to the audit.
A J CRANSTOUN FCA As Delegate of the Auditor-General of Queensland
Brisbane 28 August 2009
Financials | Gladstone Ports Corporation | Annual Report 2008–09120
Income statementfor the year ended 30 June 2009
Note 2009 2008
$’000 $’000
Income
Revenue 3(a) 280,068 242,156
Other income 3(a) 12,128 11,633
Profit on disposal of non-current assets 372 1,106
Revaluation of non-current assets 8(d) 127 9,776
Reversal of prior devaluations 8(d) 14,622 60
Reversal of impairment 8(e) - 812
Total income 307,317 265,543
Expenses
Employee expenses 77,922 69,333
Operational expenses 3(b) 71,058 73,137
Depreciation/amortisation expenses 3(b) 43,397 37,255
Impairment of non-current assets 8(e) 3,960 -
Revaluation of non-current assets 8(d) - 3,771
Loss on disposal of non-current assets 43 283
Expenses before finance costs 196,380 183,779
Finance costs 3(b) 31,648 26,031
Total expenses and finance costs 228,028 209,810
Profit before related income tax equivalent expense 79,289 55,733
Income tax equivalent expense 4(a) 23,669 16,480
Net profit for the year from continuing operations 55,620 39,253
The accompanying notes form part of these financial statements.
Financials | Gladstone Ports Corporation | Annual Report 2008–09 121
Balance sheetas at June 30 2009
Note 2009 2008
Assets $’000 $’000
Current assets
Cash and cash equivalents 5 166,664 96,610
Trade and other receivables 6 60,579 70,329
Inventories of maintenance and operations spares 7 9,071 7,940
Prepayments 814 762
Total current assets 237,128 175,641
Non-current assets
Trade and other receivables 6 1,236 1,435
Property, plant and equipment 8 1,295,298 1,189,804
Deferred tax assets 4(c) 9,077 7,988
Intangible assets 9 2,984 3,587
Investment properties 10 65,273 65,348
Total non-current assets 1,373,868 1,268,162
Total assets 1,610,996 1,443,803
Liabilities
Current liabilities
Trade and other payables 11 31,538 31,183
Short term borrowings 12 - 1,030
Short term provisions 13 44,944 40,171
Income tax payable 12,720 6,152
Foreign currency contract 18 320 132
Total current liabilities 89,522 78,668
Non-current liabilities
Long term borrowings 12 547,994 454,769
Long term provisions 13 14,959 13,004
Deferred tax liabilities 4(d) 94,997 76,541
Total non-current liabilities 657,950 544,314
Total liabilities 747,472 622,982
Net assets 863,524 820,821
Equity
Issued capital 19 725,943 725,943
Reserves 60,909 40,583
Retained profits 76,672 54,295
Total equity 863,524 820,821
The accompanying notes form part of these financial statements.
Financials | Gladstone Ports Corporation | Annual Report 2008–09122
Statement of changes in equityfor the year ended 30 June 2009
NoteContributed
equity
Asset revaluation
reserveRetained
profits Total
$’000 $’000 $’000 $’000
Balance 1 July 2007 675,943 41,289 41,842 759,074
Revaluation of non-current assets 8(d) - (851) - (851)
Impairment of assets 8(e) - (43) - (43)
Disposal of revalued assets - (80) 80 -Income tax on items taken directly to or transferred from equity 4(d) - 268 - 268Total income and expense for the period recognised directly in equity
Profit for the period - - 39,253 39,253
Equity transactions
Additional equity contributions on existing shareholding 19 50,000 - - 50,000
Dividends proposed 16 - - (26,880) (26,880)
Balance 30 June 2008 725,943 40,583 54,295 820,821
Revaluation of non-current assets 8(d) - 29,037 - 29,037Income tax on items taken directly to or transferred from equity 4(d) - (8,711) - (8,711)Total income and expense for the period recognised directly in equity
Profit for the period - - 55,620 55,620
Equity transactions
Dividends proposed 16 - - (33,243) (33,243)
Balance 30 June 2009 725,943 60,909 76,672 863,524
The accompanying notes form part of these financial statements.
Financials | Gladstone Ports Corporation | Annual Report 2008–09 123
Cash flow statementfor the year ended 30 June 2009
Note 2009 2008
$’000 $’000
Cash flows from operating activities
Receipts from customers 325,765 241,776
Tax paid to Queensland Treasury (8,446) -
GST (paid)/collected (to)/from ATO (11,899) 2,595
Payments to suppliers and employees (168,564) (176,714)
Interest received 6,621 2,257
Interest paid/competitive neutrality fee (29,205) (23,032)
Net cash flows from operating activities 20(a) 114,272 46,882
Cash flows from investing activitiesProceeds from sale of property, plant and equipment 1,180 3,530
Purchase of property, plant and equipment (101,966) (149,838)
Purchase of investment properties (583) (276)
Purchase of intangibles (40) (444)
Net cash flows used in investing activities (101,409) (147,028)
Cash flows from financing activities
Gain on foreign exchange 101 -
Equity injection - 50,000
Proceeds from borrowings 85,000 108,000
Repayment of borrowings (1,030) (1,030)
Dividends paid (26,880) (4,980)Net cash flows from financing activities 57,191 151,990
Net increase in cash and cash equivalents 70,054 51,844
Cash and cash equivalents at beginning of the financial year 96,610 44,766
Cash and cash equivalents at the end of the financial year 5 166,664 96,610
The accompanying notes form part of these financial statements.
Financials | Gladstone Ports Corporation | Annual Report 2008–09124
Notes to the financial statementsfor the year ended 30 June 2009
1. General
Gladstone Ports Corporation Limited (GPC) is a public company incorporated and operating in Australia. GPC’s registered office and principal place of business is:
19 Yarroon Street Gladstone QLD 4680 Tel: (07) 4976 1333
2. Summary of significant accounting policies
(a) Basis of accounting
General
These financial statements are a general purpose financial report and have been prepared in accordance with the Corporations Act 2001, the Financial Administration and Audit Act 1977, Financial Management Standard 1997, applicable Australian Accounting Standards and Interpretations.
This financial report has been prepared under the historical cost convention, except for some classes of property, plant and equipment, investment properties, interest free loans and derivative financial instruments, which have been measured at fair value. The financial statements are presented in Australian Dollars which is the entity’s functional currency.
The financial report complies with Australian Accounting Standards, Australian Accounting Interpretations and other authoritative pronouncements of the Australian Accounting Standards Board.
GPC has not adopted Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet effective for the annual reporting period ended 30 June 2009. These are outlined in the table below:
TitleOperative for reporting periods
beginning on/afterAASB 1: First-time Adoption of Australian Equivalent to International Financial Reporting Standards 1 January 2009
AASB 3 (revised): Business Combinations 1 July 2009
AASB 8: Operating Segments 1 January 2009
AASB 101 (revised): Presentation of Financial Statements 1 January 2009
AASB 123 (revised): Borrowing Costs 1 January 2009
AASB 127 (revised): Consolidated and Separate Financial Statements 1 July 2009
AASB 1039: Concise Financial Reports 1 January 2009AASB 2007-3: Amendments to Australian Accounting Standards arising from AASB 8 [AASB 5, AASB 6, AASB 102, AASB 107, AASB 119, AASB 127, AASB 134, AASB 136, AASB 1023 and AASB 1038] 1 January 2009AASB 2007-6: Amendments to Australian Accounting Standards arising from AASB 123 [AASB 1, AASB 101, AASB 107, AASB 111, AASB 116 and AASB 138 and Interpretations 1 & 12] 1 January 2009AASB 2007-8: Amendments to Australian Accounting Standards arising from AASB 101 1 January 2009AASB 2007-10: Further Amendments to Australian Accounting Standards arising from the Review of AASB 101 1 January 2009AASB 2008-1: Amendments to Australian Accounting Standard – Share-based Payments: Vesting Conditions and Cancellations [AASB 2] 1 January 2009AASB 2008-2: Amendments to Australian Accounting Standards – Puttable Financial Instruments and Obligations arising on Liquidation [AASB 7, AASB 101, AASB 132, AASB 139 & Interpretation 2]
1 January 2009
AASB 2008-3: Amendments to Australian Accounting Standards arising from AASB 3 and AASB 127 [AASBs 1, 2, 4, 5, 7, 101, 107, 112, 114, 116, 121, 128, 131, 132, 133, 134, 136, 137, 138 & 139 and Interpretations 9 & 107]
1 July 2009
Financials | Gladstone Ports Corporation | Annual Report 2008–09 125
Notes to the financial statementsfor the year ended 30 June 2009
TitleOperative for reporting periods
beginning on/afterAASB 2008-5: Amendments to Australian Accounting Standards arising from the Annual Improvements Project [AASB 5, 7, 101, 102, 107, 108, 110, 116, 118, 119, 120, 123, 127, 128, 129, 131, 132, 134, 136, 138, 139, 140, 141, 1023 & 1038] 1 January 2009AASB 2008-6: Further Amendments to Australian Accounting Standards arising from the Annual Improvements Project [AASB 1 & AASB 5] 1 January 2009AASB 2008-7: Amendments to Australian Accounting Standards – Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate [AASB 1. AASB 118, AASB 121, AASB 127 and AASB 136] 1 January 2009
AASB Int. 15: Agreements for the Construction of Real Estate [AASB 118] 1 January 2009AASB 2008-8: Amendments to Australian Accounting Standards – Eligible Hedged Items {AASB 139] 1 July 2009
AASB 2008-9: Amendments to AASB 1049 for Consistency with AASB 101 1 January 2009AASB 2008-11: Amendments to Australian Accounting Standard – Business Combinations Among Not-for-Profit Entities [AASB 3] 1 July 2009AASB 2008-13: Amendments to Australian Accounting Standards arising from AASB Interpretation 17 – Distributions of Non-cash Assets to Owners [AASB 5 and AASB 110} 1 July 2009AASB 2009-1: Amendments to Australian Accounting Standards – Borrowing Costs for Not-for-Profit Public Sector Entities [AASB 1, AASB 111 and AASB 123] 1 January 2009AASB 2009-2: Amendments to Australian Accounting Standards – Improving Disclosures about Financial Instruments [AASB 4, AASB 7, AASB 1023 and AASB 1038] 1 January 2009AASB 2009-4: Amendments to Australian Accounting Standards arising from the Annual Improvements Project [AASB 2 and AASB 138, and AASB Interpretations 9 and 16] 1 July 2009AASB 2009-5: Further Amendments to Australian Accounting Standards arising from the Annual Improvements Project [ASSB 5, AASB 8, AASB 101, AASB 107, AASB 117, AASB 118, AASB 136 and AASB 139] 1 January 2010
AASB 2009-6: Amendments to Australian Accounting Standards 1 January 2009
AASB 2009-7: Amendments to Australian Accounting Standards [AASB 5, AASB 7, AASB 107, AASB 112, AASB 136, AASB 139 and Interpretation 17] 1 July 2009
It is anticipated that the above Standards and Interpretations are either not applicable to GPC or adoption of them in future periods will have no material financial impact on GPC’s financial statements.
Accounting policies
Unless otherwise stated, all accounting policies applied are consistent with those of the prior year. Where appropriate, comparative figures have been amended to accord with the current year’s presentation and disclosure.
Classification between current and non-current
In the determination of whether an asset or liability is current or non-current, consideration is given to the time when each asset or liability is expected to be realised or paid. The asset or liability is classified as current if it is expected to be turned over within the next twelve months, being GPC’s operational cycle. Items are classified as current unless there is a legal write to defer receipt or payment.
Rounding of amounts
The company is of a kind referred to in ASIC Class Order 98-0100 dated 10 July 1998 and in accordance with that class order, amounts in the financial report and directors’ report have been rounded to the nearest one thousand dollars, unless otherwise stated.
2. Summary of significant accounting policies (cont.)
Financials | Gladstone Ports Corporation | Annual Report 2008–09126
Notes to the financial statementsas at June 30 2009
2. Summary of significant accounting policies (cont.)
(b) Revenue recognition
Revenue is recognised when services are delivered and is measured at the fair value of the consideration received or receivable to the extent that it is probable that the economic benefits will flow to GPC and the revenue can be reliably measured. Revenue has been calculated based on existing signed contracts.
Lease income from investment properties is recognised in income on a straight-line basis over the term of the lease. Interest income is recognised as interest accrues using the effective interest method.
Sale of assets
The profit or loss on sale of an asset is determined when control has passed to the buyer. In accounting for the sale of non-current assets, the net gains/losses on sale of assets sold are included in the Income Statement.
(c) Cash and cash equivalents
For purposes of the Cash Flow Statement, cash includes cash on hand, deposits at call and term deposits with banks and Queensland Treasury Corporation.
(d) Receivables
Trade debtors are recognised at the nominal amounts due at the time of sale or service delivery, with settlement being required within 30 days from month end.
The likelihood of collection of receivables is assessed on an ongoing basis with provision being made for impaired debts. Debts which are regarded as not recoverable are written off.
Other debtors generally arise from transactions outside the usual operating activities of GPC and are recognised at their assessed values.
(e) Inventories of maintenance and operations spares
Inventories held for use are valued at the lower of cost or net realisable value. Costs are assigned to individual items of stock on the basis of weighted average costs.
(f) Property, plant and equipment
Property, plant and equipment are stated at cost or fair value, less accumulated depreciation and any impairment losses.
The purchase method of accounting is used for all acquisitions of assets, being the fair value of the assets provided as consideration at the date of acquisition plus any incidental costs attributable to the acquisition.
The cost of non-current assets constructed by GPC includes the cost of all materials used in construction, direct labour on the project and an appropriate proportion of variable and fixed overheads.
Such cost includes the cost of replacing parts that are eligible for capitalisation when the cost of replacing the parts is incurred. Similarly, when each major inspection is performed, its cost is recognised in the carrying amount of the plant and equipment as a replacement only if it is eligible for capitalisation. All other repairs and maintenance are recognised in the Income Statement as incurred.
Financials | Gladstone Ports Corporation | Annual Report 2008–09 127
Notes to the financial statementsas at June 30 2009
2. Summary of significant accounting policies (cont.)
(f) Property, plant and equipment (cont)
Depreciation is provided on a straight line basis on all non-current assets, except land, at rates based on the expected economic lives of assets. The depreciation rates used for major assets in each class are as follows:
2009 2008
Buildings 2.50%–10.00% 2.50%–10.00%
Channels swing basins and berth pockets 2.50%–3.51% 2.50%–3.51%
Commercial wharves 2.50%–20.00% 2.50%–20.00%
Recreational and fishing wharves 2.50%–20.00% 2.50%–20.00%
Roads and services 2.00%–15.40% 2.00%–15.40%
Plant 2.50%–20.00% 2.50%–20.00%
Furniture 10.00%–27.02% 10.00%–27.02%
Where assets have separately identifiable components, these components are assigned useful lives distinct from the asset to which they relate.
Any expenditure that increases the originally assessed capacity or service potential of an asset is capitalised and the new depreciable amount is depreciated over the remaining useful life of the asset to GPC.
Work-in-progress (WIP) is not depreciated until it reaches service delivery capacity.
The assets’ residual values, useful lives and amortisation methods are reviewed, and adjusted if appropriate, at each financial year end.
Revaluations
Any revaluation increment is credited to the asset revaluation reserve included in the equity section of the Balance Sheet, except to the extent that it reverses a revaluation decrease of the same asset previously recognised in the Income Statement, in which case the increase is recognised in the Income Statement.
Any revaluation decrease is recognised in profit and loss, except to the extent that it offsets a previous revaluation increase for the same asset, in which case the decrease is debited directly to the asset revaluation reserve to the extent of the credit balance existing in the revaluation reserve for that asset.
Additionally, any accumulated depreciation as at the revaluation date is eliminated against the gross carrying amounts of the assets and the net amounts are restated to the revalued amounts of the assets.
Upon disposal or de-recognition, any revaluation reserve relating to a particular asset being sold is transferred to retained earnings.
Non-current physical assets measured under ‘fair value principles’ are independently revalued at least once every five years, with interim valuations being otherwise performed where the change would be material to that class of assets.
The following classes of assets are valued using ‘fair value principles’: land, buildings, channels, swing basins and berth pockets, commercial wharves, recreational and fishing wharves, and roads and services (structural improvements).
An asset recording threshold of one thousand dollars has been adopted and applies to all assets acquired with a useful life of more than one year.
Financials | Gladstone Ports Corporation | Annual Report 2008–09128
Notes to the financial statementsas at June 30 2009
2. Summary of significant accounting policies (cont.)
(f) Property, plant and equipment (cont.)
Impairment
Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. Recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows that are largely independent of the cash inflows from other assets or groups of assets (cash generating units). Assets are tested for possible reversal of the impairment whenever events or changes in circumstances indicate that the impairment may be reversed.
Disposal
An item of property, plant and equipment is de-recognised upon disposal or when no further economic benefits are expected from its use or disposal.
Any gain or loss arising on de-recognition of the asset is included in the income statement in the year the asset is de-recognised.
(g) Intangible assets
Intangible assets with a cost or other value greater than $100,000 are recognised in the financial statements, items with a lesser value being expensed. Each intangible asset is amortised over its estimated useful life, less any anticipated residual value. The residual value is assumed to be zero for all intangible assets.
It has been determined that there is not an active market for any of the intangible assets. As such, the assets are recognised at their initial cost and carried at cost less accumulated amortisation less accumulated impairment.
Intangible assets are tested annually for impairment. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. Recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows that are largely independent of the cash inflows from other assets or groups of assets (cash generating units). Assets are tested for possible reversal of the impairment whenever events or changes in circumstances indicate that the impairment may be reversed.
Software
Costs associated with the development of a computer software system have been recognised as an intangible asset and are to be amortised on a straight-line basis over a period of 10 years.
(h) Investment properties
Investment properties are measured initially at cost. Subsequent to initial recognition, investment properties are stated at fair value, which reflects market conditions at the balance sheet date. Gains or losses arising from changes in the fair values of investment properties are recognised in the Income Statement in the year they arise.
Investment properties are derecognised either when they have been disposed of or when the investment property is permanently withdrawn from use and no future economic benefit is expected from its disposal. Any gains or losses on the retirement or disposal of an investment property are recognised in the Income Statement in the year of retirement or disposal.
Transfers are made to investment property when, and only when, there is a change in use, as evidenced by ending of owner occupation, commencement of an operating lease to another party or ending construction or development.
Transfers are made from investment property when, and only when, there is a change in use, evidenced by commencement of owner occupation or commencement of development with a view to sale.
Financials | Gladstone Ports Corporation | Annual Report 2008–09 129
Notes to the financial statementsas at June 30 2009
2. Summary of significant accounting policies (cont.)
(i) Leased non-current assets
Operating lease payments are representative of the pattern of benefits derived from the leased assets and accordingly are charged as an expense in the periods in which they are incurred.
(j) Payables
Payables are recognised for amounts payable in the future for goods and services received, whether or not billed to GPC. Creditors are generally unsecured, not subject to interest charges and are normally settled within 30 days of month end.
(k) Loans and borrowings
All loans and borrowings are initially recognised at the fair value of the consideration received less directly attributable transaction costs.
Borrowings are classified as current liabilities unless GPC has an unconditional right to defer settlement of the liability for at least 12 months after the balance sheet date.
Borrowing costs are expensed as incurred as per the provisions of AASB123.
The competitive neutrality fee is a fee payable to the State to ensure the loan from Queensland Treasury Corporation (QTC) reflects market rates on a stand-alone basis, rather than on the strength of any implied State support.
(l) Employee leave benefits
(i) Wages and salaries, annual leave, sick leave and non-monetary benefits
Liabilities for wages and salaries, annual leave, vested sick leave and accumulated time off are recognised and are measured as the amount unpaid at the reporting date at pay rates anticipated on settlement in respect of employees’ services, including related on-costs.
(ii) Long service leave
The provision has been calculated using anticipated wage and salary rates including related on-costs and expected settlement dates based on usage patterns and is discounted using rates attaching to national government securities at balance date which most closely match the terms of the maturity of the related liabilities.
(iii) Current and non-current employee benefits
Employees’ benefits for annual leave, long service leave and vested sick leave are classified as current and non current based on usage patterns identified from historical data.
(iv) Performance payments
Performance payments for GPC’s executive officers are based on a percentage of the annual salary package provided under their contract(s) of employment. A liability is recognised and is determined as an estimate of the amount due for the period to date.
(v) Superannuation
All GPC employees are members of QSuper. QSuper operates both a defined benefit and defined contribution fundExisting employees may remain in either fund but cannot transfer into the defined benefit fund. Existing members can transfer from the defined benefit fund to the defined contribution fund. New employees must join the defined contribution fund.
The defined benefit fund is open to many employees across Queensland State Government departments, agencies and government business enterprises. There is insufficient information for GPC to apply defined benefit accounting.
No liability is recognised for accruing superannuation benefits as this liability is held on a whole of Government basis and reported in the whole of Government financial statements prepared in terms of AAS31 Financial Reporting by Governments.
Financials | Gladstone Ports Corporation | Annual Report 2008–09130
Notes to the financial statementsas at June 30 2009
2. Summary of significant accounting policies (cont.)
(m) Provisions
Provisions are recognised when there is a legal, equitable or constructive obligation to make a future sacrifice of economic benefits to other entities as a result of past transactions or other past events and it is probable that a future sacrifice of economic benefits will be required and a reliable estimate can be made of the amount of the obligation.
Dividends
A provision for dividends is recognised at the reporting date where the dividends have been declared, determined or recommended prior to the reporting date.
(n) Taxation
As a government owned corporation, GPC is required to pay income tax equivalents under the National Tax Equivalents Regime (NTER).
The deferred tax asset or deferred tax liabilities represent the net cumulative effect of items of income and expense, which have been brought to account for tax and accounting purposes in different periods.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will be available against the deductible temporary differences and the carry-forward of unused tax credits and unused tax losses can be utilised.
The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax to be utilised.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates that have been enacted or substantially enacted at the balance sheet date.
(o) Goods and services tax
Revenues, expenses and assets are recognised net of the amount of Goods and Services Tax (GST), except where the amount of GST incurred is not recoverable from the ATO. In these circumstances, the GST is recognised as part of the cost of acquisition or part of the item of expense.
Receivables and payables are stated with the amount of GST included.
The gross amount payable to the ATO is included as a current liability and the gross amount recoverable is included as a current asset.
Cash flows are included in the Cash Flow Statement on a gross basis. The GST components of cash flows arising from investing and financing activities that are recoverable from or payable to the ATO, are classified as operating cash flows.
(p) Derivative financial instruments
Where GPC is exposed to the risk of fluctuations in foreign currency exchange rates, GPC enters into derivative financial instrument arrangements to reduce this exposure. Financial derivatives may be held to cover a known exposure but only to the extent of the exposure and not for speculative purposes. Unrealised exchange gains or losses resulting from these transactions are recognised at 30 June each year. The balance of the gain or loss on the transaction is recognised on settlement of the transaction.
(q) Foreign currency transactions
In preparing the financial statements, transactions in currencies other than the entity’s functional currency are recorded at the rates of exchange prevailing on the dates of the transactions. At each balance sheet date, monetary items denominated in foreign currencies are retranslated at the rates prevailing at the balance sheet date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the date when fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.
Financials | Gladstone Ports Corporation | Annual Report 2008–09 131
Notes to the financial statementsas at June 30 2009
2. Summary of significant accounting policies (cont.)
(r) Security deposits
Security deposits may be held on certain contracts and are repayable after the satisfactory completion of the contractual terms.
(s) Critical accounting judgements, estimates and assumptions
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that may have a financial impact on the entity and that are believed to be reasonable under the circumstances.
GPC makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.
(i) Income taxes
There are many transactions and calculations undertaken during the ordinary course of business for which the ultimate tax determination is uncertain. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the current and deferred tax provisions in the period in which such determination is made.
(ii) Fair value
Judgements are made in respect of the reasonableness of revaluation indices applied to investment property, financial assets and property, plant and equipment for management valuations.
(iii) Impairment of non-financial assets
GPC assess impairment of all assets at each reporting date by evaluating conditions specific to GPC and to the particular asset that may lead to impairment. If an impairment trigger exists the recoverable amount of the asset is determined. This involves value in use calculations, which incorporate a number of key estimates and assumptions. For more information on the 2009 impairment calculations refer to note 8(e).
(iv) Sick leave and long service leave provision
As discussed in note 2(l) (i) and (ii), the liability for long service leave is recognised and measured at the present value of the estimated future cash flows to be made in respect of all employees at balance sheet date. In determining the present value of the liability, attrition rates and pay increases through promotion and inflation have been taken into account.
(v) Recovery of deferred tax assets
Deferred tax assets are recognised for deductible temporary differences as management considers that it is probable that future taxable profits will be available to utilise those temporary differences.
(vi) Estimation of useful lives
The estimation of the useful lives of assets has been based upon historical experience as well as manufacturers’ warranties (for plant and equipment), lease terms (for leased equipment) and turnover policies (for motor vehicles). In addition, the condition of the assets is assessed at least once per year and considered against the remaining useful life. Adjustments to useful life are made when considered necessary.
(vii) Provision for rehabilitation and demolition
Provision is made where GPC has a present obligation for the rehabilitation or demolition of an asset. An estimate of the expenditure for each circumstance is evaluated with third party assistance where possible. Where third party assistance is not available management make a reasonable estimate based upon the information available. The related carrying amounts are disclosed in notes 13 and 15.
(viii) Provision for obsolete stock
Due to the large volume of inventories, this assessment is based on supportable past obsolescence history and write offs. The provision is estimated by multiplying the gross inventory figure by the average rate of obsolescence identified during regular reviews of the inventories.
(ix) Provision for impaired debts
Where receivables are beyond normal trading terms, the likelihood of the recovery of these receivables is assessed by management. All receivables are assessed on an individual basis. The provision is outlined in note 6.
Financials | Gladstone Ports Corporation | Annual Report 2008–09132
Notes to the financial statementsas at June 30 2009
3. Profit from operating activities
(a) Revenue
Revenue from operating activities before related income tax equivalent expense includes:
2009 2008
$’000 $’000
Revenues
Harbour dues 34,098 31,437
Tonnage rates 29,985 26,283
Other shipping charges 7,348 6,690
Cargo handling charges 202,029 173,272
Property revenue 4,854 2,889
Smallcraft services 1,754 1,585
Total 280,068 242,156
Other income
Interest received 6,963 2,420
Recoverable works 4,721 8,890
Workers compensation refunds 14 11
Apprenticeship rebates 38 5
Traineeship allowances 49 158
Other 343 149
Total 12,128 11,633
(b) Expenses
Expenses from ordinary activities before related income tax equivalent expense includes:
Note 2009 2008
$’000 $’000
Depreciation expense
Property, plant and equipment 8 43,095 37,007
Intangibles 9 643 573
Reallocated to capital expenses (341) (325)
Total 43,397 37,255
Operational expenses
Contractors 21,518 21,034
Services and consultants 3,830 3,140
Indirect taxes and government charges 3,189 2,929
Materials and supplies 16,360 14,759
Energy 17,113 18,288
Insurance 2,320 2,134
Other 6,728 10,853
Total 71,058 73,137
Finance costs
Interest 28,571 23,230
Competitive neutrality fee 2(k) 2,990 2,467
Financial instrument loss 87 334
Total 31,648 26,031
Financials | Gladstone Ports Corporation | Annual Report 2008–09 133
Notes to the financial statementsas at June 30 2009
4. Income tax equivalent
(a) Income tax equivalent expense
2009Restated
2009Original
2008
$’000 $’000 $’000
Profit before income tax equivalents 79,289 55,733 55,732
Prima facie tax at 30% 23,787 16,720 16,720
Non-deductible expenses 35 7 8
Indexation of capital assets (4) (29) (28)
Deductible expenses (149) (218) -
Income tax expense 23,669 16,480 16,700
Comprises
Deferred tax asset (1,089) (1,035) (1,035)
Deferred tax liability 9,745 11,363 9,713
Income tax payable 15,013 6,152 8,022
23,669 16,480 16,700
The 2008 provision for income tax was adjusted following a review of deductible research and development expenditure.
(b) Amounts charged or credited directly to equity
2009 2008
$’000 $’000Deferred income tax related to items charged or credited directly to equity
Net gain on revaluation of property plant and equipment 26,142 17,393
Deferred income tax reported in equity 26,142 17,393
Financials | Gladstone Ports Corporation | Annual Report 2008–09134
Notes to the financial statementsas at June 30 2009
4. Income tax equivalent (cont.)
(c) Deferred tax asset
2009 2008
$’000 $’000
Long service leave 2,851 2,493
Sick leave 1,445 1,305
Annual leave 2,827 2,607
Accumulated time off 345 352
Provision for rehabilitation and demolition 415 1,025
Provision for deferred maintenance 116 107
Obsolete maintenance spares provision 9 26
Accrued expenses 28 33
Unrealised loss on financial instruments 96 40
Impairment of WIP 945 -
Balance at 30 June 9,077 7,988
Opening balance 7,988 6,953
Amount credited to Income Statement 1,089 1,035
Closing balance 9,077 7,988
(d) Deferred tax liability
2009Restated
2009Original
2008
$’000 $’000 $’000
Inventory 934 637 759
Accrued income 173 70 70
Research and Development in WIP 313 1,484 -
Accelerated depreciation: plant and equipment 93,577 74,350 74,213
Balance at 30 June 94,997 76,541 75,042
2009Restated
2009Original
2008
$’000 $’000 $’000
Opening balance 76,541 65,446 65,597
Amount charged to Income Statement 9,745 11,363 9,713
Amount (charged)/credited direct to equity 8,711 (268) (268)
Closing balance 94,997 76,541 75,042
GPC recouped all remaining carried forward losses during the 2008 year.
The 2008 deferred tax liability was adjusted following a review of deductible research and development expenditure.
Financials | Gladstone Ports Corporation | Annual Report 2008–09 135
Notes to the financial statementsas at June 30 2009
5. Cash and cash equivalents
Note 2009 2008
$’000 $’000
Cash non-interest bearing 3 5
Cash at bank 9,133 5,305
Queensland Treasury Corporation – cash on call 157,528 91,300
Total 21(d) 166,664 96,610
Cash at bank earns interest at floating rates based upon daily bank deposit rates. The carrying amount of cash and cash equivalents represents fair value.
Money market investments are limited to investments in bank-backed securities or short dated securities guaranteed by the Commonwealth or the State. Credit risk exposure on these investments is minimised by the short term nature of the investment.
6. Trade and other receivables
2009 2008
$’000 $’000
Current
Trade debtors 58,095 68,774
Less: provision for impaired trade debtors (348) (348)
57,747 68,426
Accrued interest 575 233
GST receivable 2,057 1,479
Term debtors 199 185
Other debtors 1 6
Total 60,579 70,329
Non-current
Term debtors 1,236 1,435
Term debtors are of a longer term nature which falls outside the normal debtor trading terms. Interest is charged at commercial rates until the debt is extinguished.
Reconciliation of impaired debts:
2009 2008
$’000 $’000
Opening balance 348 365
Impaired debts written off (81) (152)
Impaired debts recovered (4) -
Movement in provision 85 135
Closing balance 348 348
Financials | Gladstone Ports Corporation | Annual Report 2008–09136
Notes to the financial statementsas at June 30 2009
6. Trade and other receivables (cont.)
Sensitivity analysis of trade and term debtor balances at 30 June:
2009 Not DueOverdue < 1 Year
Overdue 1–5 Years
Overdue > 5 Years
$’000 $’000 $’000 $’000
Debtor balance 54,725 4,459 - 346
Impaired debt provision - (2) - (346)
54,725 4,457 - -
2008 Not DueOverdue < 1 Year
Overdue 1–5 Years
Overdue > 5 Years
$’000 $’000 $’000 $’000
Debtor balance 64,507 5,536 351 -
Impaired debt provision - - (348) -
64,507 5,536 3 -
The major component of debtor exposure is to coal producers using the Port of Gladstone for the export of product. Coal producers are mostly major listed companies or their related companies and account for 85% (2008: 84%) of trade debtors at balance date. Credit is only available to established customers on 30 day terms except in the case of coal exporters who may be required to make payment within 14 days of receipt of monthly statements.
Credit risk exposure is minimised in the case of term leases where personal guarantees are required from directors of small private companies. In addition, receivable balances are monitored on an ongoing basis with the result that GPC’s exposure to bad debts is not significant.
7. Inventories of maintenance and operations spares
2009 2008
$’000 $’000
Current
Inventories 9,100 8,025
Less: provision for obsolete stock (29) (85)
Total 9,071 7,940
Financials | Gladstone Ports Corporation | Annual Report 2008–09 137
Notes to the financial statementsas at June 30 2009
8. Property, plant and equipment
(a) Schedule of values
2009
Cost or valuation
Accumulated depreciation
Net book value
$’000 $’000 $’000
Land 78,528 - 78,528
Buildings 23,573 - 23,573
Channels, swing basins and berth pockets 136,410 - 136,410
Commercial wharves 228,128 - 228,128
Recreational and fishing wharves 340 - 340
Roads and services (structural improvements) 91,377 - 91,377
Plant 619,192 - 619,192
Furniture and fittings 178 - 178
Capital works in progress 117,572 - 117,572
Total 1,295,298 - 1,295,298
2008
Cost or valuation
Accumulated depreciation
Net book value
$’000 $’000 $’000
Land 77,221 - 77,221
Buildings 18,767 (4,287) 14,480
Channels, swing basins and berth pockets 126,499 (14,182) 112,317
Commercial wharves 241,122 (5,102) 236,020
Recreational and fishing wharves 842 (492) 350
Roads and services (structural improvements) 77,385 (8,445) 68,940
Plant 567,850 (91,257) 476,593
Furniture and fittings 279 (246) 33
Capital works in progress 203,850 - 203,850
Total 1,313,815 (124,011) 1,189,804
Financials | Gladstone Ports Corporation | Annual Report 2008–09138
Notes to the financial statementsas at June 30 2009
8. Property, plant and equipment (cont.)
(b) Reconciliations
Reconciliations of the carrying amount for each class of property, plant and equipment at 30 June 2009 are set out below:
Carrying amount at
1 July 2008
WIP additions
Transfers to/from
WIP Disposals Revalutions Depreciation Impairment
Carrying amount at
30 June 2009
$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000
Land 77,221 - 1,273 - 34 - - 78,528
Buildings 14,480 - 10,394 - (71) (1,171) (59) 23,573Channels, swing basins and berth pockets 112,317 - (319) - 28,197 (3,788) 3 136,410Commercial wharves 236,020 - (17,926) - 9,891 (1,244) 1,387 228,128Recreational and fishing wharves 350 - - - - (10) - 340Roads and services (structural improvements) 68,940 - 26,632 - 5,495 (7,682) (2,008) 91,377
Plant 476,593 - 171,853 (65) 113 (29,170) (132) 619,192Furniture and fittings 33 - 175 - - (30) - 178
Capital works in progress 203,850 108,955 (192,082) - - - (3,151) 117,572
Total 1,189,804 108,955 - (65) 43,659 (43,095) (3,960) 1,295,298
Reconciliations of the carrying amount for each class of property, plant and equipment at 30 June 2008 are set out below:
Carrying amount at
1 July 2007
WIP additions
Transfers to/from
WIP Disposals Revalutions Depreciation Impairment
Carrying amount at
30 June 2008
$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000
Land 78,269 - 3,995 (481) (4,562) - - 77,221
Buildings 14,832 - 602 (10) - (784) (160) 14,480Channels, swing basins and berth pockets 100,251 - 15,476 - - (3,409) (1) 112,317Commercial wharves 76,845 - 164,287 - - (6,650) 1,538 236,020Recreational and fishing wharves 360 - - - - (10) - 350Roads and services (structural improvements) 61,935 - 9,499 (171) - (2,140) (183) 68,940
Plant 297,256 - 203,873 (104) - (24,008) (424) 476,593Furniture and fittings 25 - 15 - - (6) (1) 33
Capital works in progress 461,648 139,949 (397,747) - - - - 203,850Total 1,091,421 139,949 - (766) (4,562) (37,007) 769 1,189,804
Financials | Gladstone Ports Corporation | Annual Report 2008–09 139
Notes to the financial statementsas at June 30 2009
8. Property, plant and equipment (cont.)
(c) Carrying amounts if assets were measured at cost less accumulated depreciation
If assets were measured using the cost model the carrying amounts would be as follows:
2009 2008Net book
valueNet book
value
$’000 $’000
Land 57,826 56,554
Buildings 21,805 13,473
Channels, swing basins and berth pockets 116,989 123,277
Commercial wharves 213,610 223,536
Recreational and fishing wharves 590 619
Roads and services (structural improvements) 87,274 78,569
Plant 618,641 477,529
Furniture and fittings 182 37
Total 1,116,917 973,594
(d) Valuations
A full valuation of all GPC assets was conducted by Mr Geoff Pyman, B.Bus, M.B.Env (ProjMgt), FAPI and Michael Pankhurst AAPI of AON Valuation Services as at 30 June 2009. Assets with a valuer’s valuation, or book value over $5,000 were revalued. Land and buildings were valued at market value. All other assets were valued at depreciable replacement cost. Where impairment calculations allowed, assets were revalued upwards. All devaluations have been reflected in the financial statements.
A revaluation review of land was carried out in March 2008 by independent valuers. Previously a comprehensive revaluation of assets except for plant, furniture and fittings at the Port of Gladstone was performed by independent valuers as at 30 June 2004 in accordance with the policy to independently value assets at least every five years. All other assets were independently valued at 1 January 2001.
Where possible fair value is calculated using active market valuations. Where no active market exists, fair value is calculated using depreciated replacement costs and evaluating against net realisable value based upon future cash flows of respective business units. The reconciliation of revaluations is shown below:
Note 2009 2008
$’000 $’000
Property, plant and equipment revaluations 8(b) 43,659 (4,562)
Investment property revaluations 10(a) 127 9,776
43,786 5,214
Revaluation of non-current assets – Income Statement revenue 127 9,776
Revaluation of non-current assets – Income Statement expenses - (3,771)
Reversal of prior devaluations – Income Statement revenue 14,622 60
Revaluation of non-current assets – asset revaluation reserve 29,037 (851)
43,786 5,214
Financials | Gladstone Ports Corporation | Annual Report 2008–09140
Notes to the financial statementsas at June 30 2009
8. Property, plant and equipment (cont.)
(e) Impairment
An impairment review was carried out at 30 June 2009. The assets were separated into cash generating units based upon wharf centres and other income earning centres. Previously impairment reviews had been carried out on larger cash generating units based upon types of income received. Fair value for all assets except land was based upon fair value in use. Land was valued at fair value less costs to sell as independent market valuations were available. The discount rate used was 12.21% (2008: 11.71%). The impairment losses identified are disclosed in note 8(b). The impairments were recognised due to known income streams for the relevant cash generating unit being insufficient to support the existing asset base of the relevant cash generating unit. Future incomes were estimated from known sources and anticipated future tonnages. Expenses were estimated from past history making adjustments for estimated future tonnages with CPI increases. The major item impaired in the 2009 financial statements was Marley Brown Oval, which was purchased for the Gladstone community and will not generate a revenue stream for GPC. The reconciliation of impairments is shown below:
Note 2009 2008
$’000 $’000
Impairment (credited)/charged to Income Statement 3,960 (812)
Impairment (credited)/charged to asset revaluation reserve - 43
Total 8(b) 3,960 (769)
9. Intangible assets
(a) Asset values at cost
2009
CostAccumulated depreciation
Net book value
$’000 $’000 $’000Computer software 5,353 (2,409) 2,944Capital WIP 40 - 40
5,393 (2,409) 2,984
2009
CostAccumulated depreciation
Net book value
$’000 $’000 $’000
Computer software 5,353 (1,766) 3,587
Capital WIP - - -
5,353 (1,766) 3,587
Financials | Gladstone Ports Corporation | Annual Report 2008–09 141
Notes to the financial statementsas at June 30 2009
9. Intangible assets (cont.)
(b) Reconciliation
Reconciliation of the carrying amount for Intangible assets at 30 June 2009:
Carrying amount at
1 JulyWIP
additions Additions Depreciation
Carrying amount at
30 June
$’000 $’000 $’000 $’000 $’000
Computer software 3,587 - - (643) 2,944
Capital WIP - 40 - - 40
3,587 40 - (643) 2,984
Reconciliation of the carrying amount for Intangible assets at 30 June 2008:
Carrying amount at
1 JulyWIP
additions Additions Depreciation
Carrying amount at
30 June
$’000 $’000 $’000 $’000 $’000
Computer software 3,586 - 574 (573) 3,587
Capital WIP 130 (130) - - -
3,716 (130) 574 (573) 3,587
10. Investment properties
(a) Investment properties
2009 2008
$’000 $’000
Opening balance 65,348 57,236
Additions 583 276
Revaluations 127 9,776
Disposals (785) (1,940)
Closing balance 65,273 65,348
Investment properties are carried at fair value, which has been determined based on independent valuations by Mr Geoff Pyman, B.Bus, M.B.Env (ProjMgt), FAPI of AON Valuation Services as at 30 June 2009, in accordance with the policy to independently value assets at least every five years.
The fair value represents the amount at which the assets could be exchanged between a knowledgeable willing buyer and a knowledgeable willing seller in an arm’s length transaction at the date of valuation, in accordance with Australian Valuation Standards.
Investment properties may only be disposed of after obtaining approval from the Portfolio Minister for Transport.
Financials | Gladstone Ports Corporation | Annual Report 2008–09142
Notes to the financial statementsas at June 30 2009
10. Investment properties (cont.)
(b) Assets subject to operating leases as lessor
2009 2008
Operating lease revenue $’000 $’000
Due not later than one year 3,608 3,111
Due later than one year and not later than five years 11,332 10,492
Due later than five years 29,468 26,494
Total 44,408 40,097
These leases relate to the GPC’s business of providing facilities for stevedoring operators as well as land and buildings for industrial use for other business purposes.
11. Trade and other payables
Current 2009 2008
$’000 $’000
Trade creditors 21,972 20,995
Rent received in advance 2,948 2,452
GST payable 5,523 5,722
Other 1,095 2,014
31,538 31,183
12. Loans and borrowings
Current 2009 2008
$’000 $’000Industry loan – non-interest bearing - 1,030
- 1,030
Non-current
Queensland Treasury Corporation loans 547,994 454,769
547,994 454,769
The industry loan was a 10 year interest free loan, which matured on 30 June 2009, and related to the purchase of an infrastructure asset.
The Queensland Treasury Corporation loans comprise of advances made under two client specific pool arrangements (CSP). The CSP will comprise a combination of bonds and Floating Rate Debt so that the weighted average term of the underlying cash flows of these instruments matches the weighted average term of the underlying cash flows of GPC’s loans.
One CSP with a book value of $461,903,572 is used for GPC’s normal operations. The second CSP is specifically designed to fund the Wiggins Island Coal Terminal Feasibility and Detailed Design project. The full amount of this loan ($86,090,780) is guaranteed by coal companies and has a maximum facility of $140 million.
Financials | Gladstone Ports Corporation | Annual Report 2008–09 143
Notes to the financial statementsas at June 30 2009
12. Loans and borrowings (cont.)
Fair values
Unless disclosed below the carrying amount of GPC’s current and non-current borrowings approximate to their fair value. The fair values have been calculated by discounting the expected future cash flows at prevailing market interest rates.
2009 2008Carrying amount Fair value
Carrying amount Fair value
$’000 $’000 $’000 $’000
Queensland Treasury Corporation Loan 547,994 558,335 454,769 447,208
13. Provisions
Note 2009 2008
Current $’000 $’000
Employee benefits 14 10,319 9,874
Provision for demolition 15 1,382 3,417
Dividends 16 33,243 26,880
Total 44,944 40,171
Non-current
Employee benefits 14 14,574 12,648
Provision for deferred maintenance 17 385 356
Total 14,959 13,004
14. Employee benefits
Aggregate liability for employee benefits including on costs:
2009 2008
$’000 $’000
Current 13 10,319 9,874
Non-current 13 14,574 12,648
24,893 22,522
2009 2008
$’000 $’000
Balance of provision at 1 July 22,522 20,587
Movement in provision calculation 2,371 1,935
Balance of provision at 30 June 24,893 22,522
Financials | Gladstone Ports Corporation | Annual Report 2008–09144
Notes to the financial statementsas at June 30 2009
15. Provision for demolition
Aggregate liability for demolition costs on existing structures:
Note 2009 2008
$’000 $’000
Balance of provision at 1 July 3,417 1,516
Reduction in provision from demolitions undertaken (2,493) -
Increase in provision 458 1,901
Balance of provision at 30 June 13 1,382 3,417
16. Dividends
Dividends provided calculations are based on 80% of net profit after an adjustment for upwards revaluations, and a reduction to account for transactions relating to the purchase of Marley Brown Oval. The effective comparable percentages are 2009 @ 80% and 2008 @ 80%. All dividends are unfranked.
Dividends provided or paid
Note 2009 2008
$’000 $’000
Balance of provision at 1 July 26,880 4,980
Dividends paid (26,880) (4,980)
Dividends provided 33,243 26,880
Balance of provision at 30 June 13 33,243 26,880
17. Provision for deferred maintenance
Accumulated funds received towards deferred maintenance and rehabilitation costs from customers:
Note 2009 2008
$’000 $’000
Balance of provision at 1 July 356 326
Amounts received 29 30
Balance of provision at 30 June 13 385 356
18. Provision for financial instruments
Unrealised losses on foreign currency hedges:
2009 2008
$’000 $’000
Balance of provision at 1 July 132 124
Provisions realised (132) (124)
Increase in unrealised provisions 320 132
Balance of provision at 30 June 320 132
Financials | Gladstone Ports Corporation | Annual Report 2008–09 145
Notes to the financial statementsas at June 30 2009
19. Contributed equity
2009 2008
No. No.Contributed equity
Authorised – 1,000,000,000 ordinary shares 1,000,000 1,000,000Issued – 372,451,970 (2008: 372,451,969) ordinary shares 372,452 372,452
2009 2008
Movements $’000 $’000
Balance at 1 July 725,943 675,943Additional amounts paid up
December 2007 - 50,000
Balance at 30 June 725,943 725,943
One additional share was issued during 2009 for $1. As directed by shareholding Ministers, the additional amounts paid up during 2008 did not result in the issuing of further shares.
20. Notes to the statement of cash flows
(a) Reconciliation of profit from ordinary activities after income tax equivalent to net cash provided by operating activities
2009 2008
$’000 $’000
Profit from ordinary activities after income tax equivalent 55,620 39,253
Depreciation 43,397 37,255
Revaluation of non-current assets (14,749) (6,065)
Impairment of non-current assets 3,960 (812)
Profit on sale or property, plant and equipment (372) (1,106)
Loss on sale of property, plant and equipment 43 283
Imputed interest on interest free loan - 91
Change in assets and liabilities
(Decrease) /Increase in receivables 10,864 (34,496)
(Increase)/ Decrease in other assets (969) 3,222
Increase in inventories (1,131) (1,109)
Increase in deferred tax asset (1,089) (1,035)
Decrease in trade creditors (6,069) (13,749)
(Decrease)/Increase in other liabilities (622) 3,769
Increase in provisions 365 3,866
Increase in income tax creditor 6,568 6,152
Increase in provision for deferred tax liability 18,456 11,363
Net cash provided by operating activities 114,272 46,882
(b) Working capital facility
Gladstone Ports Corporation Limited has access to a $30,000,000 (2008: $30,000,000) working capital facility provided through Queensland Treasury Corporation. This facility has not been drawn upon during the financial year.
Financials | Gladstone Ports Corporation | Annual Report 2008–09146
Notes to the financial statementsas at June 30 2009
21. Financial risk management objectives and policies
GPC’s principal financial instruments comprise receivables, payables, bank loans, cash and short term deposits and derivatives.
GPC manages its exposure to key financial risks, including interest rate and currency risk, in accordance with its financial policies. The objectives of the policies are to support the delivery of GPC’s financial targets whilst protecting future financial security.
GPC enters into derivative transactions, principally forward currency contracts. The purpose is to manage the currency risks arising from GPC’s operations. These derivatives provide economic hedges, but do not qualify for hedge accounting and are based upon limits set by the Board. The main risks arising from GPC’s financial instruments are credit risk, interest rate risk, foreign currency risk and liquidity risk. GPC uses different methods to measure and manage different types of risks to which it is exposed. These include monitoring levels of exposure to interest rate and foreign exchange risk and assessments of market forecasts for interest rate, foreign exchange and commodity prices. Ageing analyses and monitoring of specific credit allowances are undertaken to manage credit risk. Liquidity risk is monitored through the development of future rolling cash flow forecasts.
The Board reviews and agrees policies for managing each of the risks summarised below:
(a) Credit risk exposure
Credit risk arises from the financial assets of GPC, which comprise cash and cash equivalents and trade and other receivables. GPC is exposed to credit risk from the possibility of counter parties failing to perform their obligations. Credit risk exposure on financial assets other than cash at bank and at call has been recognised in the Balance Sheet, with the carrying amount stated net of any provision for impaired debts.
GPC does not hold any credit derivatives to offset its credit exposure. The level of exposure is disclosed in Note 5.
(b) Foreign currency risk
GPC has transactional currency exposures in relation to capital purchases in currencies other than Australian dollars. GPC requires management to examine eliminating currency exposure on any individual transactions in excess of $500,000. It is GPC’s policy not to enter into forward contracts until a firm commitment is in place and to negotiate the terms of the hedge derivatives to exactly match the terms of the hedged item to maximise hedge effectiveness. As at 30 June 2009 GPC did not have any exposure to foreign currency that is not designated in Note 22.
(c) Liquidity risk
GPC’s objective is to maintain a balance between continuity of funding and flexibility through the use of bank loans and finance leases.
The table below reflects all contractually fixed pay-offs and receivables for settlement, repayments and interest resulting from recognised financial assets and liabilities, including derivative financial instruments as at 30 June 2009. For derivative financial instruments the market value is presented, whereas for the other obligations the respective undiscounted cash flows are presented. Cash flows for financial assets and liabilities without fixed amount or timing are based upon the conditions existing at 30 June 2009.
Financials | Gladstone Ports Corporation | Annual Report 2008–09 147
Notes to the financial statementsas at June 30 200921. Financial risk management objectives and policies (cont.)
(c) Liquidity risk (cont.)
Maturity analysis of financial assets and financial liabilities based upon managements expectations
< 1 year 1 – 5 Years > 5 years Total
Year ended 30 June 2009 $’000 $’000 $’000 $’000
Financial assets
Cash and cash equivalents 166,664 - - 166,664
Trade and other receivables 60,579 953 283 61,815
227,243 953 283 228,479
Financial liabilities
Trade and other payables 31,538 - - 31,538
Interest bearing loans and borrowings - 86,091 461,903 547,994
Derivatives 320 - - 320
31,858 86,091 461,903 579,852
Net maturity 195,385 (85,138) (461,620) (351,373)
< 1 year 1 – 5 Years > 5 years Total
Year ended 30 June 2008 $’000 $’000 $’000 $’000
Financial assets
Cash and cash equivalents 96,610 - - 96,610
Trade and other receivables 70,329 888 547 71,764
166,939 888 547 168,374
Financial liabilities
Trade and other payables 31,183 - - 31,183
Interest bearing loans and borrowings - - 454,769 454,769
Non interest bearing loans 1,030 - - 1,030
Derivatives 132 - - 132
32,345 - 454,769 487,114
Net maturity 134,594 888 (454,222) (318,740)
The risks implied in the table above reflect a balanced view of cash inflows and outflows.
Leasing obligations, trade payables and other financial liabilities mainly originate from the financing of assets used in our ongoing operations such as property, plant and equipment and investments in working capital such as inventories and trade receivables. These assets are considered in GPC’s overall liquidity risk.
To monitor existing financial assets and liabilities as well as to enable an effective controlling of future risks, GPC has established comprehensive risk reporting that reflects expectations of management of settlement of financial assets and liabilities.
GPC monitors rolling forecasts of liquidity reserves on the basis of expected cash flow. At balance date GPC had available $30 million of unused credit facilities available for use.
Financials | Gladstone Ports Corporation | Annual Report 2008–09148
Notes to the financial statementsas at June 30 2009
21. Financial risk management objectives and policies (cont.)
(d) Interest rate risk exposure
GPC’s exposure to interest rate risk relates primarily to GPC’s long term debt obligations. The level of debt is disclosed in note 12.
At 30 June 2009 GPC had the following mix of financial assets and liabilities exposed to Australian variable interest rate risk that are not designated as cash flow hedges:
2009 2008
$’000 $’000
Financial assets
Cash and cash equivalents 166,661 96,605
Financial liabilities
Interest bearing loans and borrowings 547,994 454,769
GPC’s policy is to manage its finance costs using a mix of fixed and variable rate debt. GPC constantly analyses its interest rate exposure where consideration is given to the mix of fixed and variable interest rates.
The following sensitivity analysis is based upon the interest risk exposures in existence at the balance sheet date. At 30 June 2009, if interest rates had moved, as illustrated in the table below, with all other variables held constant, post tax profit and equity would have been affected as follows:
Post tax profit Equity
2009 2008 2009 2008
$’000 $’000 $’000 $’000
+1% (100 basis points) (441) (133) 441 133
-1% (100 basis points) 441 133 (441) (133)
(e) Net fair value
Cash at bank and at call are valued as the amount of the deposit or the purchase price of the underlying security. Receivables are carried at the nominal amount due, less provision for impaired debts which represents the assessed credit risk.
Liability to trade creditors is recognised on receipt of goods and services at nominal value. Payment would normally occur within 30 days.
Borrowings outstanding at 30 June 2009 have been valued at book using long term interest rates negotiated with Queensland Treasury Corporation.
Financials | Gladstone Ports Corporation | Annual Report 2008–09 149
Notes to the financial statementsas at June 30 2009
22. Derivative financial instruments
During 2009 GPC entered into agreement to purchase mobile plant with the purchase price denominated in a foreign currency. In order to protect against exchange rate movements, GPC entered into forward exchange contracts to purchase United States dollars. The agreement is expected to be finalised in August 2009.
At balance date, the details of the outstanding contracts are (in Australian dollar equivalents):
Sell Australian dollars Average exchange rate
2009 2008 2009 2008
$’000 $’000
Maturity:
0 – 6 months 2,205 2,259 0.688637 0.900654
6 – 12 months - - n/a n/a
These contracts are fair valued by comparing the contracted rate to market rates for contracts with the same length of maturity. All movements in fair value are recorded in the profit or loss in the period they occur. The net fair value losses on foreign currency derivatives during the year were $86,564 (2008: $334,486).
23. Commitments
Capital expenditure commitments contracted but not provided for:
2009 2008
$’000 $’000
Due not later than one year 11,417 22,471
Operating leases as lessee
These leases relate to office equipment, light vehicles and heavy moving equipment:
2009 2008
$’000 $’000
Due not later than one year 1,057 1,728
Due later than one year and not later than five years 275 669
1,332 2,397
24. Auditors’ remuneration
Amounts excluding GST received or due and receivable by the Auditor-General of Queensland for auditing the accounts. No other benefits were received by the auditors:
2009 2008
$’000 $’000
Remuneration 94 110
The remuneration calculation is the estimated fee for the audit for the year ended 30 June with an adjustment for the under or over provision of the prior year estimate.
Financials | Gladstone Ports Corporation | Annual Report 2008–09150
Notes to the financial statementsas at June 30 2009
25. Key management personnel disclosures
Directors
Directors’ emoluments are set by the State Government with other fees and allowances determined on the basis of meetings attended and expenditure incurred in performing their roles. Directors do not receive performance related remuneration.
Specified executives
The Human Resources Committee recommend executive remuneration to the Board. The committee utilises market and industry surveys to ascertain an appropriate level of remuneration to attract appropriately skilled staff. The remuneration policy is subject to State Government guidelines and changes to executive remuneration are approved by the Board and advised to shareholding Ministers.
The Corporation’s remuneration policy is based on a total employment cost (TEC) concept. The TEC concept ensures all benefits including salary, superannuation, motor vehicle etc. are included in the remuneration package cost.
Short term benefits are disclosed as the gross salary package (excluding bonuses) and may be taken either as salary or salary sacrificed by the director or employee. Amounts paid on separation are included as a short term benefit.
All disclosed items relate to the amounts received by each senior executive for the full financial year irrespective of when they commenced their role listed above. Other benefits are listed as taxable fringe benefits amounts. These may include benefits that are available to all employees of GPC and are not specific to the listed roles.
Senior executives are eligible for an at risk performance payment based on the achievement of specific organisational goals and individual performance. The performance indicators include financial, operational, safety and customer satisfaction targets.
The initial targets are set by the Board and are developed from the key goals contained within the Statement of Corporate Intent. The ‘at risk’ payment is totally contingent upon the Board’s assessment of GPC’s performance and in line with Government requirements. The maximum at risk payment available is 15% of total remuneration. Payments are made in cash, or if appropriate notice has been provided, paid into the employee’s superannuation fund on a salary sacrifice basis.
From 2004 all new senior executive appointments are for fixed three year terms. Other senior executives employed prior to this date are employed on tenure, otherwise their terms and conditions of employment are the same. All senior executives’ remuneration levels increase in line with the market assessments up to a maximum of 10% per annum where remuneration remains below the market median. Where remuneration is above market median annual increases are restricted to CPI increases.
Separation benefits, in the event of termination by GPC, other than for misconduct, are allowed for in the agreements. The Chief Executive Officer is entitled to three months notice, or payment in lieu of notice as well as a separation payment of the lesser of 12 months pay and the amount which would otherwise be paid between the determination date and the end of the contract term. Senior executives are entitled to four weeks notice or payment in lieu. In the event of a position being made redundant the executive is entitled to eight weeks pay plus three weeks pay for each year of service, up to a maximum of 52 weeks. In accordance with Ministerial guidelines details of directors and the eight senior executives of the entity with the greatest authority in office at 30 June 2009 are as follows:
Financials | Gladstone Ports Corporation | Annual Report 2008–09 151
Notes to the financial statementsas at June 30 2009
25. Key management personnel disclosures (cont.)
Short term benefits
Post employment benefits
Other benefits Total
DirectorsDirectors’
feesSuper-
annuationRetirement
benefits
$’000 $’000 $’000 $’000 $’000
Brusasco am, I (Chairman1)
2009 50 2 - - 52
2008 48 - - - 48
Corones, P2
2009 22 2 - - 24
2008 19 2 - - 21
Ware, C2
2009 24 2 - - 26
2008 26 2 - - 28
Campbell, S3
2009 6 1 - - 7
2008 23 2 - - 25
Scott, R2
2009 20 2 - - 22
2008 19 2 - - 21
Crawford, T4
2009 24 2 - - 26
2008 23 2 - - 25
Staines, A4
2009 26 2 - - 28
2008 28 3 - - 31
O’Grady, R5
2009 - - - - -
2008 16 1 - - 17
Kelly, A6
2009 22 2 - - 24
2008 14 2 - - 16
Davidson, G7
2009 15 1 - - 16
2008 - - - - -
Reynolds, J7
2009 17 2 - - 19
2008 - - - - -
Total remuneration: Directors
2009 226 18 - - 244
2008 216 16 - - 232
1 Reappointed 1 February 2009 2 Reappointed 1 October 20073 Resigned 30 September 20084 Reappointed 1 October 20085 Appointed 1 July 2006, Stood down 15 April 2008, Resigned 30 September 20086 Appointed 11 October 2007 7 Appointed 1 October 2008
Transactions of a similar nature are disclosed in aggregate except when separate disclosure is necessary and material.
Financials | Gladstone Ports Corporation | Annual Report 2008–09152
Notes to the financial statementsas at June 30 2009
25. Key management personnel disclosures (cont.)
Contract expiry date Short term benefits
Post employment
benefits Other benefits Total
Specified executives SalarySeparation payments
Super- annuation
Motor vehicle Other
$’000 $’000 $’000 $’000 $’000 $’000Zussino, L CEO 31-Aug-10
2009 286 - 36 16 4 342
2008 246 - 31 15 4 296Galt, M Commercial GM 18-Mar-11
2009 192 - 24 7 3 226
2008 167 - 21 7 - 195
Drury, I Port Planning and Development GM1 Tenured
2009 173 - 20 7 3 203
2008 161 - 20 7 3 191Greenaway, M Project GM 21-Nov 09
2009 181 - 23 9 3 216
2008 161 - 21 7 3 192O’Sullivan, P Corporate Relations GM2 3-Mar-08
2009 - - - - - -
2008 115 - 13 9 5 142Sayner, H Corporate Relations GM3 3-Dec-11
2009 88 120 11 10 - 229
2008 - - - - - -Cook, L Operations GM4 7-Nov-08
2009 - - - - - -
2008 106 - 8 4 - 118Walker, C Port Operations GM 15-Jan-12
2009 203 - 25 12 4 244
2008 166 - 21 7 4 198
Total remuneration: specified executives
2009 1,123 120 139 61 17 1,460
2008 1,122 - 135 56 19 1,332
1 Position title changed from Engineering and Environment General Manager 2 August 2007.2 Resigned 11 April 2008.3 Appointed 16 September 2008 and resigned 9 April 2009.4 Appointed 7 November 2005 and resigned 13 November 2007.
Financials | Gladstone Ports Corporation | Annual Report 2008–09 153
Notes to the financial statementsas at June 30 2009
25. Key management personnel disclosures (cont.)
Related party disclosure
Gladstone Ports Corporation Limited is a Company government owned corporation owned by the Queensland Government and established as a body corporate under an act of parliament. Government owned corporations operate in a commercial environment and deliver a range of services across diverse industries such as energy, transport and funds management. All transactions between the Gladstone Ports Corporation Limited and other government owned corporations are on an arm’s length commercial basis.
2009 2008
Agency Nature $’000 $’000
Revenue
Queensland Rail 3rd rail loop extensions - 269
Japan visit 2 -
Maritime Safety Queensland Marina tenant power and rates recovery - 13
Expenses
Ergon Energy Electricity 961 -
Ports Corporation Queensland Conference registration - 3
Queensland Audit Office Audit fees 153 100Queensland Department of Natural Resources Purchase of land 301 121
Environmental Protection Agency Permits 26 17Queensland Department of Primary Industries Permits 27 3Queensland Department of Mines and Energy Report on particulate emissions - 20
Office of State Revenue Land tax and payroll tax 3,595 3,051Queensland Department of State Development Sponsorships - 3
Queensland Department of TransportIncluding survey work, dredging and registrations 611 510
Queensland Department of Main Roads Excess mass permits 5 1
Workplace Health and Safety Training - 6
Gladstone Area Water Board Water and capital contributions 408 301
Port of Brisbane Corporation Dredging and MSIC applications 1,515 1,510
Queensland Rail Overhead power supply - 180Queensland Rail Learning and Development Centre PICOW training - 3
Queensland Purchasing Department Training - 6
Queensland Treasury CorporationLoan interest, competitive neutrality fee and rates 33,605 25,269
Queensland Fire and Rescue Fire alarm call outs 38 47
QSuper Superannuation contributions 11,774 10,734
WorkCover Queensland Workers compensation insurance 2,072 1,744
The Co-ordinator General Gladstone Infrastructure Study Stage 1 and 2 320 18
Gladstone City Council Rates and contribution to car park shades - 1,693
Banana Shire Council Industry donation - 1
Calliope Shire Council Rates - 154
Gladstone Regional Council Rates 1,503 -
Central Queensland University Rent and environmental monitoring 280 297
Financials | Gladstone Ports Corporation | Annual Report 2008–09154
Notes to the financial statementsas at June 30 2009
26. Aggregate performance payments
At-risk performance payments
2009 2008
Note $’000 $’000
Aggregate performance payments provided for executive employees 167 211
The executive performance payment represents the provision for the bonuses to be paid for the year ended 30 June plus or minus any adjustment for prior year over or under provisions.Total salaries and wages (including bonuses) paid or payable to executive employees 1,400 1,299
No. of employees
No. of employees
Number of executive employees who received a performance payment 5 7The following categories of employees are eligible for at-risk performance incentive remuneration:
• Chief Executive Officer
• Senior executives
2009 2008
$’000 $’000
Total salaries and wages paid or payable to all employees 65,386 58,694
Superannuation paid or payable for all employees 7,003 5,990
27. Segment information
GPC operates in a single industry, namely the Maritime Port Industry, in Central Queensland at two locations – the Port of Gladstone and Port Alma.
28. Contingent assets and liabilities
As at the date of these accounts, the Board is not aware of any material contingent assets. The Board has identified the following contingent liability:
The Department of Environment and Resource Management (DERM) has identified that a former tenant of GPC (now insolvent) has contaminated their leased land with aluminium slag product. To date the DERM has been unsuccessful in prosecuting the directors to rectify the contamination. GPC has estimated that the rectification costs for their preferred option will be approximately $850,000.
Financials | Gladstone Ports Corporation | Annual Report 2008–09 155
Notes to the financial statementsas at June 30 2009
29. Change of name and conversion to Company Government Owned Corporation
In accordance with Government Owned Corporations Amendment Regulation (No. 1) 2008 Central Queensland Ports Authority changed its name to Gladstone Ports Corporation effective from 13 March 2008. As a result of converting to a company GOC Gladstone Ports Corporation changed its name to Gladstone Ports Corporation Limited on 1 July 2008.
Transition of GPC to company GOC status
On 7 March 2007, Queensland State Parliament passed the Government Owned Corporations Amendment Act 2007 (Amendment Act), which was assented to on 20 March 2007, resulting in key changes to the Government Owned Corporations Act 1993 (GOC Act).
Under amendment to section 24(b) of the GOC Act, all statutory GOC’s existing at the date the Amendment Act was assented to, are required to transition to company GOC status. On 1 July 2008, the Company GOC conversion became effective, with the registration of Gladstone Ports Corporation Limited completed with the Australian Securities and Investments Commission.
From the date of conversion, GPC was required to comply with the requirements of the accountability and reporting framework set out under the Corporations Act 2001.
The change in status has not impacted on the balances and other disclosures included in this report.
30. Events occurring after balance sheet date
On 2 June 2009 the Queensland Premier announced that GPC would be taking over control of the Port of Bundaberg from Port of Brisbane Corporation. It is anticipated that this will occur during 2009–10. The implications of this direction are not known at this time. Consequently, the impact of the transactions cannot be estimated.
On 31 July 2009 GPC’s Board approved a resolution to repatriate $90 million of issued capital to shareholders in December 2009.
31. Wiggins Island Coal Terminal Project
GPC is currently undertaking a Full Feasibility Study and Detailed Design for Wiggins Island Coal Terminal Project (WICT). It is anticipated that this project will be handed over to a third party for completion during the 2010 financial year. The balances that relate to this project that are included in the balance sheet are:
2009 2008
$’000 $’000
Assets
Cash and cash equivalents 19,726 -
Trade and other receivables – trade debtors 1,305 -
Trade and other receivables – GST receivable 367 -
Trade and other receivables – Interest receivable 200 -
Property, plant and equipment – WIP 72,780 -
94,378 -
Liabilities
Long term borrowings 86,091 -
Trade and other payables 8,287 -
94,378 -
32. Number of employees
2009 2008
Number of employees at year end 646 606
The number of employees represents the total number of people employed by GPC as at 30 June, irrespective of whether they are employed on a full or part time basis or are permanent or temporary employees.
Certification of annual financial statements | Gladstone Ports Corporation | Annual Report 2008–09156
Certification of annual financial statements
We have prepared the foregoing annual financial statements pursuant to the provisions of the Corporations Act 2001 and the Financial Administration and Audit Act 1977 and certify that:
(a) The foregoing annual financial statements and notes to and forming part thereof are in agreement with the accounts and records of the Gladstone Ports Corporation Limited Limited; and
(b) In our opinion:
i. There are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable;
ii. The attached financial statements and notes thereto are in accordance with the Corporations Act 2001, including compliance with accounting standards and giving a true and fair view of the financial position and performance of the company.
L M Zussino Date: 28 August 2009 Chief Executive Officer
M A Galt Date: 28 August 2009 Commercial General Manager
Gladstone
Director’s declaration | Gladstone Ports Corporation | Annual Report 2008–09 157
Directors’ declaration
The Directors declare that:
i. In the Directors’ opinion, there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable;
ii. In the Directors’ opinion, the attached financial statements and notes thereto are in accordance with the Corporations Act 2001, including compliance with accounting standards and giving a true and fair view of the financial position and performance of the company.
Signed in accordance with a resolution of the directors made pursuant to s.295(5) of the Corporations Act 2001.
On behalf of the Directors
I Brusasco am Date: 28 August 2009Chairman
J Reynolds Date: 28 August 2009 Director
Gladstone
Independent auditor’s report | Gladstone Ports Corporation | Annual Report 2008–09158
Independent auditor’s report
To the Board of the Gladstone Ports Corporation Limited
Matters Relating to the Electronic Presentation of the Audited Financial Report
The audit report relates to the financial report of the Gladstone Ports Corporation Limited for the financial year ended 30 June 2009 included on the Gladstone Ports Corporation Limited’s web site. The Directors are responsible for the integrity of the Gladstone Ports Corporation Limited’s web site. We have not been engaged to report on the integrity of the Gladstone Ports Corporation Limited’s web site. The audit report refers only to the statements named below. It does not provide an opinion on any other information which may have been hyperlinked to/from these statements. If users of the financial report are concerned with the inherent risks arising from electronic data communications they are advised to refer to the hard copy of the audited financial report, available from the Gladstone Ports Corporation Limited, to confirm the information included in the audited financial report presented on this web site.
These matters also relate to the presentation of the audited financial report in other electronic media including CD Rom.
Report on the Financial Report
I have audited the accompanying financial report of the Gladstone Ports Corporation Limited which comprises the Balance Sheet as at 30 June 2009, and the Income Statement, Statement of Changes in Equity and Cash Flow Statement for the year ended on that date, a summary of significant accounting policies, other explanatory notes and the Directors’ Declaration.
Directors’ Responsibility for the Financial Report
The directors of the company are responsible for the preparation and fair presentation of the financial report in accordance with Australian Accounting Standards (including the Australian Accounting Interpretations), and the Corporations Act 2001. This responsibility includes establishing and maintaining internal controls relevant to the preparation and fair presentation of the financial report that is free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.
Auditor’s Responsibility
My responsibility is to express an opinion on the financial report based on the audit. The audit was conducted in accordance with Auditor-General of Queensland Auditing Standards, which incorporate the Australian Auditing Standards. These Auditing Standards require compliance with relevant ethical requirements relating to audit engagements and that the audit is planned and performed to obtain reasonable assurance whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgment, including the assessment of risks of material misstatement in the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal controls relevant to the entity’s preparation and fair presentation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies and the reasonableness of accounting estimates made by the Directors, as well as evaluating the overall presentation of the financial report.
I believe that the audit evidence obtained is sufficient and appropriate to provide a basis for my audit opinion.
Independence
The Financial Administration and Audit Act 1977 promotes the independence of the Auditor-General and QAO authorised auditors. The Auditor-General is the auditor of all Queensland Government Owned Corporations and can only be removed by Parliament.
The Auditor-General may conduct an audit in any way considered appropriate and is not subject to direction by any person about the way in which audit powers are to be exercised. The Auditor-General has for the purposes of conducting an audit, access to all documents and property and can report to Parliament matters which in the Auditor-General’s opinion are significant.
In conducting the audit, the independence requirements of the Corporations Act 2001 have been complied with. I confirm that the independence declaration required by the Corporations Act 2001, provided to the directors of Gladstone Ports Corporation Limited on 28 August 2009 would be in the same terms if provided to the directors as at the date of this auditor’s report.
159Independent auditor’s report | Gladstone Ports Corporation | Annual Report 2008–09
Independent auditor’s report
Audit Opinion
In my opinion the financial report of Gladstone Ports Corporation Limited is in accordance with the Corporations Act 2001, including –
(i) giving a true and fair view of the company’s financial position as at 30 June 2009 and of its performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards (including Australian Accounting Interpretations) and the Corporations Regulations 2001.
A J CRANSTOUN FCA As delegate of the Auditor-General of Queensland
Brisbane 2009
Glossary of terms | Gladstone Ports Corporation | Annual Report 2008–09160
Glossary of terms
ATSI
Aboriginal and Torres Strait Islander
BPCT
Barney Point Coal Terminal
Bulk cargo
Cargo moved in bulk form, such as coal (dry bulk) or naphtha (liquid bulk)
GPC
Gladstone Ports Corporation
DWT
Dead weight tonnes. A measurement of a ship’s tonnage indicating the actual carrying capacity of the ship
EBIT
Earnings before interest and tax
EEO
Depending on context:
Equal Employment Opportunity
Energy Efficiency Opportunities
EIS
Environmental Impact Statement
EMS
Environmental Management System
EPA
Environmental Protection Agency
Gladstone Port Central
Includes Barney Point and Auckland Point facilities
GOC
Government Owned Corporation
Gross shiploading rate
Total tonnes loaded
Total time taken to load including delays
Gross train unloading rate
Total tonnes unloaded
Total time taken to unload including delays
ha
Hectares
ISO 14001
An international standard for environmental management systems – specification with guidance for use
km
Kilometres
KPI
Key Performance Indicator
LTI
Lost Time Injury
LTIFR
Lost Time Injury Frequency Rate – number of work-related injuries resulting in a lost time injury, per million hours worked
MSIC
Maritime Security Identification Card
MSP
Maritime Security Plan
Mt
Million tonnes
Mtpa
Million tonnes per annum
NSCA
National Safety Council of Australia
PCIMP
Port Curtis Integrated Monitoring Program
QR
Queensland Rail
QAL
Queensland Alumina Limited
RCM
Reliability Centred Maintenance
RGTCT
RG Tanna Coal Terminal
Summary of Statement of Corporate Intent
Summarises our statement of corporate intent. The statement of corporate intent is a document created under chapter 3, part 8 of the Government Owned Corporations Act. It specifies our financial and non-financial performance targets for activities in the relevant financial year, and is consistent with our corporate plan The statement of corporate intent represents an agreement between the GPCs board of directors and our shareholding Ministers
t
Tonnes
tph
Tonnes per hour
161Index | Gladstone Ports Corporation | Annual Report 2008–09
Inde
x About us II-III
Audit
Environmental 51
External 96, 99,101
Internal 38, 59, 78–79, 81, 96, 99–102
Safety 81
Security 38–39
Board and governance
Chairman’s Review 12
Chief Executive Officer’s Review 15
Code of Conduct 102
Commercial General Manager’s Review 18
Committees 97, 99–102
Communication Objective i
Corporate Governance 96–103
Corporate Governance 89
Directors 90–93
Fraud, Corruption and Official Misconduct 102
Practices 96–103
Remuneration 100–101
Risk management 80, 82, 96, 101–103
Risk Management Policy 102–103
Role of the Board 97
Customers 13–14, 16–17, 19, 21–25, 36, 64–65, 96, 102–103
Complaints 16, 24, 51, 58, 79
Environment
Complaints 51, 58
Compliance 52–53
Environmental Management System 13, 16, 51, 58
Environmental Performance 52, 55
Flatback turtles 54
Mangroves 55
PCIMP 54–55
Seagrass 54
FInAnCIAl
Highlights 4–5
Performance 11, 98, 101, 105–106, 108
Review 18, 104
Statements 115–158
VIsIon, MIssIon And VAlues 1
Performance
Coal exports 4, 13, 15–16, 18, 27–28, 30–31, 33, 112
Gladstone Port Central 28
Imports 28, 30–33
Industry cargoes 31
Maintenance management 36
Port Alma 5, 27, 29, 31–33
RG Tanna Coal Terminal 22, 28–31, 37, 43
Throughput 5, 13, 16, 19, 25, 27–31, 105
Wharf centres 28–29, 35, 64
Remuneration arrangements
Board 101
Senior management 101
Security
Audit 38–39
Plan 38–39
Senior management 94–95
Community
Bursaries 66
Community Support Program 13, 63–65
Gladstone Marina and Spinnaker Park 66
Port Open Day 17, 63, 65, 67
People
Enterprise Bargaining Agreement 71, 79, 100
Equal Employment Opportunity 73, 75
Health and Safety 71, 78–80, 82, 100
People 38, 46, 63, 67–87
Training 17, 51, 56, 62, 64, 71–73, 76–77, 79–80, 82–83, 100
Section title here | Gladstone Ports Corporation | Annual Report 2008–09 162
Inde
x co
nt...
Pages are printed on Pacesetter Satin 148gsm
Cover is printed on Impress Silk 350gsm
GRAPH INDEX
Capital expenditure 5-year summary 110
Community complaints 58
EBIT 5-year summary 109
Energy types and sources for 2008 59
Expenses 5-year summary 106
Interest bearing liability 5-year summary 111
NPAT 5-year summary 109
Port Alma Shipping Terminal import and export comparison 33
Port Alma throughput by industry 31
Port of Gladstone import and export comparison 33
Port of Gladstone major coal markets 30
Port of Gladstone throughput by industry 31
Port of Gladstone throughput by wharf centre 30
Return on assets 5-year summary 111
Return on equity 5-year summary 111
Revenue 5-year summary 106
Shareholder equity 5-year summary 110
Taxes and dividends 5-year summary 109
Throughput by industry 28
Total assets 5-year summary 110
WorkCover total claim and average cost of claim 87
TABLE INDEX
Board and committee meeting attendance 99
Breakdown of employee positions as of 30-06-09 75
Equal Employment Opportunity (EEO) statistics 2008–09 75
Financial trend analysis 107
GPC youth employment and training 77
Key performance indicators 105
Maximising shareholder return 19
Number of employees 71
Occasions of service 2008–09 85
Total port throughput 29
DIAGRAM/MAP INDEX
Export/import map 32
Organisational structure 96
Port Alma Shipping Terminal map ii
Port of Gladstone map ii
Real Time Air Quality Monitoring Sites 57
Index | Gladstone Ports Corporation | Annual Report 2008–09 IBC
Section title here | Gladstone Ports Corporation | Annual Report 2008–09163
Gladstone Ports Corporation Limited
19 Yarroon Street, Gladstone PO Box 259 Gladstone, Queensland, 4680 Australia
T: +61 7 4976 1333F: +61 7 4972 3045
www.gpcl.com.au