Year in review highlights 633.5 460.4 PPA 21,122 42.2 2016) (LTIFR) PPA 0.55 2.7 1,022,051 2016) 24 2,174,533 12 (20 2016) & HR WA IT – 60 & $204,000 VTS TOTAL ON PORT TARGET VESSEL A AND INDUSTRY COMMUNITY AND THROUGHPUT PORT THROUGHPUT PORT PORT DAMPIER PORT PORT PORT HEDLAND AND PORT PILBARA A A A A MANAGEMENT OF HEDLAND OF OF IN EXCELLENCE NUMBER OF THE THE OF THE THE OF AND AND OF AND ENVIRONMENTAL AUSTRALIA RATE ON PUBLIC STANDARDS INJURY AGAINST
Organisational Structure Minister for Transport Board of Directors Chief Executive Officer GM Development & Trade GM Engineering & Infrastructure GM Operations Risk & Governance GM Finance & ICT Human Resources • Ongoing Trade • Business Development • New Port Planning • Land Planning • Commercial Contracts and Lease Management • GIS • Mechanical, Civil and Electrical Engineering Services • Infrastructure Planning & Delivery • Asset Management & Associated Maintenance Planning • Harbour Masters • Marine Research & Development • Maritime Coordination (Pilots/Tugs/Helicopters) • VTS & Scheduling • Dredging • MSIC & Security • MSIA & Regulations • Civil, Mechanical & Electrical Facility Management • Traffic Management • Stevedoring Oversight • Bulk Handling & Cargo Operations • Health & Safety • Environment & Heritage • Legal Services • Corporate & Government Affairs • Company Secretariat • Governance • Enterprise Risk • Internal Audit • Finance • Information and Communications Technology • Information Management • Financial Risk & Audit • Human Resources • Industrial Relations • Training & • Physical Resources (Office Space, Housing & Fleet)
GENERAL MANAGER RISK AND GOVERNANCE Raechel Paris BA, LLB GENERAL MANAGER OPERATIONS Captain John Finch MBA MANAGER, DEVELOPMENT AND TRADE Lyle Banks BEng, LLM Ms Paris has more than 19 years’ experience in legal, commercial and governance roles with national and international accountability, and brings a wealth of corporate governance knowledge to Pilbara Ports Authority. She joined the former Port Hedland Port Authority in 2011 as the General Manager, Risk and Governance. Ms Paris holds a Bachelor of Arts/Law from Monash University, and is a member of the Governance Institute and a Graduate of the Australian Institute of Company Directors. She is also Pilbara Ports Authority’s Company Secretary. Captain Finch is General Manager of Operations, holding the same position with Port Hedland Port Authority since 2011. He is a Master Mariner by profession and holds a MBA in Maritime Management. Mr Finch has 30 years’ experience in marine, regulatory and port management roles and brings extensive knowledge and operational expertise to Pilbara Ports Authority. Previously, he was Harbour Master in a number of Queensland ports. Mr Finch has held senior port operations and regulatory positions after serving approximately 15 years on international and coastal vessels in various marine industry sectors. Mr Banks brings with him 25 years’ national and international experience in port planning and development in both private and public sectors. He joined Port Hedland Port Authority in 2013 as the General Manager Commerce and Development, and is currently responsible for port development projects in Dampier and Port Hedland. Mr Banks also held management roles in Planning, Development and Environment at Fremantle Ports. He holds a Master’s of Law and Bachelor of Engineering from the University of Melbourne, a Diploma in Business (Port and Terminal Management) from the Australian Maritime College, and is a Member of the Australian Institute of Company Directors.
Key Business Results Year on Year PROFIT BEFORE INCOME TAX NET PROFIT AFTER TAX PORT TRADE $283.8 million $198.9 million $171.1 million $119.7 million 619.8 million tonnes 633.5 million tonnes RETURN ASSETS 26.3% 18.1% TOTAL SHIP MOVEMENTS 24,980 21,122 LEGEND 2014/ 15 2015/ 16
Performance against Government Goals The following table shows the alignment between relevant Government goals, Pilbara Ports Authority’s strategic objectives, targeted outcomes, measures and results. Goal 1 – Results-based delivery Goal 2 – Financial and economic responsibility PILBARA PORTS AUTHORITY OBJECTIVE To facilitate trade through the Pilbara for the benefit of the State RESULTS KEY OUTCOMES SOUGHT Customer satisfaction Suitable, reliable port facilities Provision for port expansion and new ports Successful proponent projects Successful completion of new projects Successful asset management MEASURES Understanding customer supply chains Facilitating private investment Provision of common user assets Port Development Plan Strategic Asset Plan
Environmental Management System Pilbara Ports Authority’s Environmental Management System is certified to ISO INCIDENT TRAINING DURING THE REPORTING YEAR Australasian Inter-Service Incident Management System (AIIMS) Level 1 Incident Management Training 12 employees 14001:2004 (International Standard for Environmental Management Systems). This certification ensures a consistent, integrated Oil Spill Response Wildlife Management Course 1 employee Australian Maritime Safety Authority National Plan – Logistics Officer course 1 employee approach in delivering environment and cultural heritage management across Pilbara Australian Maritime Safety Authority National Plan – Incident Management Team course 3 employees Ports Authority’s services and activities, with a strong focus on continual improvement. Pilbara Ports Authority is working towards certification to the new ISO 14001:2015 standard in 2016. Incident Preparedness and Response Pilbara Ports Authority operates and is responsible for emergency/incident management within defined port authority limits. Pilbara Ports Authority implements a consistent and industry recognised incident response methodology across its sites. Key personnel are trained, qualified and competent in incident response. During the reporting year, Pilbara Ports Authority has continued to enhance its emergency response capabilities, as detailed above. Ports of Ashburton and Dampier The Port of Dampier and Port of Ashburton Emergency Response Plan was reviewed and updated in September 2015, and regular emergency response exercises were conducted both internally and externally with stakeholders. The Marine Safety Plans for both ports have been approved by the Pilbara Ports Authority Board and in June 2016 were forwarded to the Minister for Transport for his approval. A set of Emergency Response Checklists have been developed for the Port of Ashburton during the reporting year to ensure Pilbara Ports Authority is prepared to facilitate an incident response within port waters. Port of Port Hedland During the reporting year, the Port Hedland Emergency Response Procedures and Operational and Facilities Emergency Response Procedures were reviewed and updated. Monthly emergency response exercises were conducted with stakeholders, which involved equipment deployment, desktop exercises and workshops. Pilbara Ports Authority continues to work closely with the Department of Fire and Emergency Services to improve the local marine fire-fighting capability, with quarterly meetings conducted. During the reporting year, operational staff from the Port of Port Hedland facilitated landside, waterside and vessel familiarisation and practical on-water training for volunteer firefighters.
Marine Pollution Emergency Response Preparedness and Training Staff regularly train for marine pollution emergency response across each Pilbara Ports Authority port, and also participate in external exercises with other government agencies. This includes the National Plan and Department of Transport (DoT) training, where staff completed courses in Incident Management Team development, logistics, shoreline and basic operator courses during the reporting year. In June 2016, several Perth and Port of Dampier staff participated in the first phase of the DoT State Marine Environmental Emergency exercise, Exercise Beadon. This The second phase of the exercise is scheduled in September 2016 and will involve staff from all Pilbara Ports Authority sites in both the Incident Management Team and field roles. Other training included emergency preparedness at the Port of Dampier involving the local Marine Oil Pollution committee. This brought together key government and port industry stakeholders to enhance marine oil spill response through the effective coordination of training, exercises, equipment and people. In December 2015, the annual table top exercise was conducted based on a response to a scenario to understand the resources required to respond to a larger event and where these may be sourced from. At the Port of Port Hedland, Exercise Airey was conducted on 21 and 22 June 2016 involving Pilbara Ports Authority staff, and participants/observers from BHP Billiton, Fortescue Metals Group, Rivtow and Roy Hill. The exercise involved an Incident Management Team scenario, a salvage workshop and field deployment. was the first State exercise to be conducted in accordance with WestPlan’s proposed new Marine Transport Emergency and Marine Oil Pilbara Ports Authority’s Emergency Response Plans reviewed and updated in 2015/16 PORT OF ASHBURTON PORT OF DAMPIER PORT PORT Pollution plans. The scenario involved a vessel grounding in the Port of Onslow, causing pollution in waters bordering the ports of Ashburton and Onslow. The objective of the exercise was to test the new WestPlan Marine Oil Pollution and Marine Transport plans, and the cross jurisdictional response. • Emergency Response Plan • Marine Oil Pollution Plan – Reviewed and updated to align with current port status and WestPlan MOP • Emergency Response Procedures and Checklists • Marine Safety Plan • Emergency Response Plan • Marine Safety Plan • 2010 Oil Spill Environmental Risk Assessment and Capability Review • Emergency Response Procedure – Operational and Facilities Emergency Response Procedure • Marine Pollution Contingency Plan
Dampier Port Survey Standards During the reporting year, hydrographic surveys were completed to Pilbara Ports Authority standards at the Port of Dampier to enable channel depths to be re-declared and a new edition of the Dampier Harbour Charts to be developed. The objective of the project was to improve the accuracy and reliability of hydrographic data within key navigational areas of the port, contributing to marine safety outcomes and gains in efficiencies. The collection of new and accurate hydrographic data was provided to the Royal Australian Navy’s Hydrographic Office to upgrade the Australian charts covering the port, including the Zone of Confidence diagrams on those charts. The updated hydrographic data was incorporated into a six month tidal study, resulting in the establishment of an accurate Lowest Astronomical Tide model or hydroid for the Port of Dampier. The establishment of the hydroid has resulted in up to 20cm of additional depth in the Rio Tinto channel, facilitating potential increases in port efficiency. Port Operations Management System – Saab Technologies (KLEIN) Pilbara Ports Authority operates a vessel traffic information management system (KLEIN) to manage a number of administrative functions related to vessel movements through the Port of Port Hedland. During the year, KLEIN was enhanced to allow relevant stakeholders to access real-time information on vessel movements through the port. Pilbara Ports Authority also identified, and is currently testing, available technology to increase efficiency relating to specific vessel traffic administrative functions. During the reporting year, a business case was approved and stakeholders were consulted as part of the change management process. Extensive trials of the proposed improvements were carried out, resulting in a successful outcome. Planning for Shipping and Pilotage Act ports Pilbara Ports Authority has progressed the due diligence for the future transition of Shipping and Pilotage Act (SPA) ports from the Department of Transport (DoT) to Pilbara Ports Authority. This change is a key element of implementing the second tranche of Ports Legislation Amendments. This will result in the progressive transfer of the ports of Airlie Island, Barrow Island, Cape Preston, Onslow, Port Walcott and Varanus Island to Pilbara Ports Authority. While the timing of the passage of further amending legislation is not confirmed, Pilbara Ports Authority has advanced its due diligence activities in consultation with DoT, Department of State Development, and existing operators.
This has involved collating information and data from a range of sources to gain a thorough understanding of tenure, critical infrastructure, heritage and the environmental considerations at each port location, operating and commercial arrangements and the extent and condition of infrastructure and/or assets that may transfer to Pilbara Ports Authority’s responsibility. Pilbara Ports Authority has continued to liaise with DoT regarding the transfer of jetty and mooring area licences, and seabed leases within the SPA ports. This also included a comprehensive legal review. Pilbara Ports Authority has also carried out a review of each port’s boundaries and developed draft guidelines to ensure a consistent approach to proposed amendments. Final boundaries will be determined in consultation with key stakeholders, including State Government departments and the proponents at each SPA port during the reporting year. Utah Point Bulk Handling Facility Divestment The Utah Facility divestment is being managed as a component of the State’s Asset Sales Program by the Western Australian Department of Treasury (Treasury). Treasury has been assisted by its Lead Financial Advisor Deloitte / Rothschild and a number of secondary advisors. During the reporting year, Pilbara Ports Authority assisted with information and feedback as part of the divestment process, including providing input to an independent review of prices at Utah Facility. On 22 March 2016, the Legislative Council referred the Pilbara Ports Assets (Disposal) Bill 2015 (Enabling Legislation) to the Upper House Standing Committee on Legislation (Committee). The Committee reported back to the Legislative Council on 25 August 2016. Stakeholder Engagement and Communications Strategy Pilbara Ports Authority’s Stakeholder Engagement and Communications Strategy was approved in October 2015. The Strategy aims to streamline and make consistent Pilbara Ports Authority’s stakeholder engagement and communications approach, management process and feedback mechanisms across the organisation. Community and stakeholder engagement is vital to the ongoing success of Pilbara Ports Authority’s growth and development. Pilbara Ports Authority establishes and maintains strong, effective links between community and industry, and fosters an open, working relationship with local communities in which it has port operations. Pilbara Ports Authority regularly engages with port users and customers, local community groups and businesses, and works closely with the Town of Port Hedland, City of Karratha and Shire of Ashburton to ensure effective two-way communication between the respective ports and the wider community is maintained.
Community Support Initiative Program Pilbara Ports Authority’s Community Support Policy provides a transparent and objective mechanism for Pilbara Ports Authority to commit financial resources and in-kind support to community initiatives. Pilbara Ports Authority provides support to a broad cross-section of community groups and charities through its Community Support Initiative program. During 2015/16, Pilbara Ports Authority supported a number of community events and organisations including: • Cossack Art Awards • Boonderu Music Academy • South Hedland Cricket Club • Town of Port Hedland’s Australia Day Fireworks • Dampier Community Association 2015 Art Awards • Tambrey Primary School, Dampier, Nature Play Space • Karratha Visitor Centre 2015 Photography Awards • Onslow Sports Club Fishing Competition • Port Hedland Chamber of Commerce and Industry Business Awards • Yaburara & Coastal Mardudhunera Aboriginal Corporation A total of $204,000 of financial and in-kind support was provided to local community, sporting and not-for-profit organisations in the Dampier/Karratha, Port Hedland and Onslow communities in 2015/16.
Attraction and Commencement Pilbara Ports Authority has applied enhancements to the Human Resources function for the attraction and commencement for new starters, with improvements to: • In-house administration; • Analysis of psychometric assessments; • Clarification of labour-hire and independent contractor arrangements, and • Modernisation of recruitment templates in line with recent research on branding for influence. Payroll Improvement During the reporting year, Pilbara Ports Authority implemented a single payroll system. This improvement has superseded the previous dual system used following the ports amalgamation on 1 July 2014. An internal payroll audit was completed in March 2016, confirming the accuracy of the payroll system data. Areas of improvement have also been implemented including capture of online overtime, increased efficiency in validation processes and service level standards. Learning & Development Pilbara Ports Authority introduced a new Learning Management System in September 2015 as part of its ongoing commitment to training and development. This self-service system enables transparency for employees in relation to their training and development needs, and ensures employees meet their mandatory training needs. Significant training and development opportunities have been provided by Pilbara Ports Authority during the reporting year, including: • Working with Respect • Working at Heights • Enter and Work in a Confined Space • Appointed Persons (Section 44) Training under the WA Mines Safety and Inspection Act 1999 • Manual Handling • Fire Fighting • Oil spill response training including Level 1 Incident Management • Overhead Travelling Crane Awareness • Hazard Management • Dangerous Goods by Sea • Restricted Asbestos Licence Training • Diploma of Project Management Employee Engagement Pilbara Ports Authority has finalised the detail of a new Employee Engagement Survey which will be delivered in August 2016. Analysis of the results and actioning of improvement opportunities will follow the survey. Diversity and Inclusion While Pilbara Ports Authority’s Equal Employment Opportunity and Diversity Management Plan is still current, Pilbara Ports Authority has commenced an early review of the benefits of diversity, based on new research. It is expected the new plan will be completed and implementation commenced by the end of 2016.
REMUNERATION REPORT In accordance with Clause 13(c) (ii) of Schedule 5 of the Act, the following report details the nature and amount of each element of the emolument of each Director and the three officers of Pilbara Ports Authority receiving the highest emoluments. BOARD AND COMMITTEE REMUNERATION SHORT TERM POST EMPLOYMENT Super- SHORT TERM POST EMPLOYMENT Super- Salary & Fees Total annuation Benefits Total Salary & Fees Total Total Directors Non-Executive Directors (Chairman) Ken Pettit (Appointed 2016 2015 $ 91,557 $ 89,662 $91,557 $89,662 $ 8,698 $ 8,821 $ Judith Uren Mike Deeks (Resigned 12/10/2015) 2016 2015 2016 2015 – $49,552 $3,231 – $14,645 $49,552 $ 307 – $ 1,391 $ 4,707 $ – $ $ 54,259 15/08/2011) $ 98,483 (Deputy Chairman) Les Longden (Appointed 01/10/2009)* Julian Tapp (Appointed 30/06/2009) Boyd Winton (Appointed 2016 2015 2016 2015 $50,549 $58,825 $47,043 $45,675 $50,549 $58,825 $47,043 $45,675 $4,802 $5,588 $4,469 $4,339 $ 55,351 $ 64,413 $ 51,512 $ 50,014 $ 45,973 $ 30,087 Beth Gordon (Retired 31/12/2015) Tony Adcock (Appointed Independent RAC Chairman 14/08/2015) Sub-total non- 2016 2015 2016 2015 $25,143 $45,222 $42,500 – $25,143 $45,222 $42,500 – $ 2,389 $ 4,296 $ 4,037 – $ 27,532 $ 49,518 $ 46,537 – John Lillywhite 22/10/2014) ratio
Executives’ Emoluments Details of emoluments provided to the three Pilbara Ports Authority officers receiving the highest emoluments are as follows: SHORT TERM POST EMPLOYMENT CAR ALLOWANCE Salary & Fees Sti Cash Bonus Total Superannuation Benefits Total Executive Officers Roger Johnston, CEO 2016 2015 $ 473,335 $ 446,596 $ 473,335 $ 446,596 $ 66,463 $ 62,733 $ 37,922 $ 35,962 $ 577,720 $ 545,291 John Finch (General Manager Operations/Harbour Master) 2016 2015 $ 409,698 $ 373,861 $ 409,698 $ 373,861 $ 53,261 $ 48,602 $ 462,959 $422,463 Raechel Paris (General Manager Risk & Governance) 2016 2015 $ 277,351 $262,152 $50,907 $25,468 $ 328,258 $ 287,620 $ 41,538 $ 37,391 $369,796 $325,011 Total Executive remuneration 2016 2015 $1,160,384 $1,082,609 $50,907 $25,468 $1,211,291 $1,108,077 $161,262 $148,726 $37,922 $35,962 $1,410,475 $1,292,765
a Statement of Financial Position for the year ended 30 June 2016 Non-current liabilities Other payables 15(b) Interest bearing borrowings 16(b) Provisions 18(b) 100 177,412 79,056 1,076 199,947 75,941 Total non-current liabilities 256,568 276,964 Total liabilities 320,364 368,949 Net assets 505,236 450,247 EQUITY Contributed equity 19 Retained earnings 214,031 291,205 178,281 271,966 Total equity 505,236 450,247 of Financial Position should be read in conjunction with the accompanying notes.
13. Deferred tax assets 2016 $’000 2015 $’000 14. 2016 $’000 2015 $’000 Trade payables 6,090 5,991 Total trade payables 6,090 5,991 15. Other payables 2016 $’000 2015 $’000 (i) This balance represents the deferred tax impact of the total provisions disclosed in Note 18. pay
a 100% N/A N/A N/A or equal to 80% Percentage of managers trained in occupational safety, health and injury management responsibilities 94% 90.6% Greater than or equal to 80% Target met Note (1) This is a three-year trend and as such the year is to be three years prior to the current reporting year (i.e. current year is 2015/16 and comparison year is 2013/14) Note (2) The current year i.e. 2015/16 Note (3) The reduction is calculated over a three year period