ANNUAL REPORT | 2024
CONTENTS
Brief Profile of Steamships Group . . . . . . . . . . . . . . 2
Financial Highlights. . . . . . . . . . . . . . . . . . . . . 4
Chairman’s Report . . . . . . . . . . . . . . . . . . . . . 6
Directors’ Review. . . . . . . . . . . . . . . . . . . . . . 8
Review of Operations - LOGISTICS. . . . . . . . . . . . 12
Consort Express Lines. . . . . . . . . . . . . . . . 12
Pacific Towing. . . . . . . . . . . . . . . . . . . . 13
Joint Venture Port Services. . . . . . . . . . . . . . 14
EastWest Transport. . . . . . . . . . . . . . . . . . 15
Review of Operations - PROPERTY AND HOSPITALITY. . 16
Coral Sea Hotels. . . . . . . . . . . . . . . . . . . 16
Pacific Palms Property. . . . . . . . . . . . . . . . 17
Sustainability. . . . . . . . . . . . . . . . . . . . . . . . 18
Corporate Governance. . . . . . . . . . . . . . . . . . . 19
Financial Section. . . . . . . . . . . . . . . . . . . . . . 20
Statements of Comprehensive Income. . . . . . . . 20
Statements of Changes in Equity. . . . . . . . . . . 21
Statements of Financial Position. . . . . . . . . . . 22
Statements of Cash Flows. . . . . . . . . . . . . . 23
Notes to the Financial Statements . . . . . . . . . . 24
Independent Auditor’s Report . . . . . . . . . . . . . . . 60
Directors’ Report. . . . . . . . . . . . . . . . . . . . . . 66
Stock Exchange Information . . . . . . . . . . . . . . . . 70
Company Directory. . . . . . . . . . . . . . . . . . . IBC
2 Steamships Annual Report 2024
BRIEF PROFILE OF STEAMSHIPS GROUP
With over 105 years of operations in Papua New Guinea, Steamships Trading Company Limited
(Steamships) is a committed investor in Papua New Guinea. The Group is a well-established
business conglomerate with diverse commercial interests and listings on both the Australian
and PNG’s National Stock Exchanges.
Steamships has a vision to build a valuable and profitable business that is widely respected as
being the best group to work for and with which to do business.
Integral to this vision are the following business strategies:
•
The long-term development of a diversified range of
businesses in which shareholder value can be created,
•
Employment of staff who we believe will further our
strategic objectives and will be committed to the Group
for the long term and providing them with rewarding
careers,
•
Operational excellence in the way we conduct our
business,
•
Doing business in a sustainable manner, and
•
Commitment to the highest standards of corporate
governance.
The Group employs over 3,365 PNG citizens and non-
citizens in diverse divisions grouped under the operating
categories of Logistics, Property and Hospitality and
Commercial and Investments. Steamships core values
include the following:
•
Safety – We prioritise safety awareness and compliance
to ensure our business operations are conducted safely.
•
Integrity – Taking the more ethical and honest path;
honouring our commitments and delivering on
our promises; creating a bond of trust that sustains
relationships with our staff, customers, shareholders,
business partners and the communities in which we do
business.
•
Excellence – Our customers and colleagues expect us
to deliver high quality goods and services. If something
is to be done, we believe it should be done in the best
possible way.
•
Customer Focus – Our customers are the final judges
of our success or failure. We understand and respond
to the needs of our customers.
•
People Development – We value a working
environment that fosters innovation and encourages
personal development and learning.
•
Humility – We believe in the need to respect and to
learn from others. To do this we must be aware of
our own limitations and to seek to understand other
perspectives.
•
Continuity – We take a long term view. We grow
our business sustainably and create enduring value
that earns the respect of our customers, our staff, our
communities and our shareholders.
Steamships is aware of its prominent position in the
community and its responsibility to serve that community.
The Group continues to be one of PNG’s largest private
sector employers and one of the largest supporters of
community initiatives in education, health and social
welfare. Steamships ensures that core sustainability
concepts are embedded in its business models and systems.
The Group is wholly aware that its business goals cannot
be achieved unless this is the case. Steamships cannot
succeed without the engagement and support of the people
it employs, the loyalty and satisfaction of its customers, the
local communities and the environment in which it operates.
Over a century after it was founded, Steamships is still
showing it has the resources and capacity, vision and
capability to meet the dynamic needs of a growing country.
STEAMSHIPS’ ORGANISATIONAL STRUCTURE
Steamships Annual Report 2024 3
BRIEF PROFILE OF STEAMSHIPS GROUP
PROPERTY AND
HOSPITALITY
STEAMSHIPS TRADING COMPANY
LOGISTICS
Consort Express
Lines
Towing
EastWest
Transport
JV Port Services
(x16 JV LO Entities)
Property
Coral Sea
Hotels
Harbourside
Development JV
Rumana JV
Wonye JV
Wonye No. 2 JV
Viva No. 31 JV
Windward
Apartments
COMMERCIAL AND
INVESTMENTS
Colgate
Palmolive JV
Port Services
Gulf Maritime
Services JV
Croesus
Hebamo
Transport
Portside Business
Park
4 Steamships Annual Report 2024
2023
2024
2023
2024
2023
2024
2023
2024
FINANCIAL HIGHLIGHTS
2024
2023
Change
K’000
K’000
%
Revenue and other income from continuing operations
747,023
669,296
12%
Profit attributable to shareholders
45,838
58,144
-21%
Cash generated from operations
156,579
103,559
51%
Net cash inflow / (outflow) before financing
34,354
(145,255)
-124%
Shareholders’ funds
1,067,425
1,052,595
1%
External borrowings
418,875
420,218
0%
Earnings per share (toea)
147.8
187.5
-21%
Dividends per share (toea)
70
95
-26%
Shareholders’ funds per share
34.42
33.95
1%
Underlying profit attributable to shareholders (Refer to page 9)
31,900
50,240
-37%
Underlying earnings per share
103
162
-37%
Gearing ratio
26.5%
26.8%
-1%
Interest cover
12.3
52.1
-76%
Dividend cover
1.5
1.8
-17%
2024 FINANCIAL HIGHLIGHTS
Steamships Annual Report 2024 5
SUMMARY OF PAST PEFORMANCE
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
K’000
K’000
K’000
K’000
K’000
K’000
K’000
K’000
K’000
K’000
STATEMENTS OF COMPREHENSIVE INCOME (including discontinued operations)
Revenue
773,535
732,701 705,687 648,106 585,168 540,406 563,929 631,262
669,296 747,023
Profit before tax
136,042
118,686
62,686 112,493 61,284
63,813
88,248
79,786
77,103
63,280
Share of associates profit
3,062
5,865
7,525
5,628
5,010
4,026
5,062
6,288
7,286
6,141
Income tax (expense) / credit
(37,710) (35,677) (32,621)
(54,420) (18,928)
11,198
(1,694) (26,633)
(25,722) (22,429)
Minority interests
(2,415)
(4,664)
3,926
5,828
2,629
(182)
(1,066)
(1,456)
(523)
(1,154)
Net profit attributable to shareholders
98,979
84,210
41,516
69,529
49,995
78,855
90,550
57,985
58,144
45,838
Equity adjustment
2,206
-
-
-
-
-
2,950
-
-
-
Dividends paid or provided for the year
(48,062) (40,291) (32,559)
(26,357) (44,962) (17,055) (35,659) (35,659)
(32,559) (31,008)
Earnings retained this year
53,123
43,919
8,957
43,172
5,033
61,800
57,841
22,326
25,585
14,830
Underlying profit attributable to shareholders
(adjusted for significant items)
80,651
71,721
61,775
43,304
31,505
36,927
67,081
76,075
50,240
31,900
STATEMENTS OF FINANCIAL POSITION
SHARE CAPITAL & RESERVES
Issued capital
24,200
24,200
24,200
24,200 24,200
24,200
24,200
24,200
24,200
24,200
Retained earnings
764,887
808,806 817,764 896,105 860,843 922,643 980,484 1,002,810 1,028,395 1,043,225
Shareholders’ funds
789,087
833,006
841,964
920,305 885,043
946,843 1,004,684 1,027,010 1,052,595 1,067,425
Non-controlling interests
47,515
48,831
36,190
19,723 17,747
16,983
16,245
17,059 17,028 17,498
EQUITY
836,602
881,837
878,154
940,028 902,790
963,826 1,020,929 1,044,069 1,069,623 1,084,923
Fixed assets / investment properties
1,072,955 1,068,892 997,125 890,576 970,928 945,075 933,983 947,451 1,073,933 1,241,427
Investments in associated companies
36,458
66,445
67,196
65,276 41,586
36,992
39,367
45,458
45,495
51,562
Future income tax benefit
36,914
36,680
30,250
1,683
2,311
1,010
2,571
2,020
4,627
4,880
Goodwill
80,491
80,491
80,002
76,433 76,433
76,433
76,433 76,433
76,433
76,433
Other assets
400,480
284,200 294,800 470,810 360,385 428,703 464,635 444,331 501,242 406,290
TOTAL ASSETS
1,627,298 1,536,708 1,469,373 1,504,778 1,451,643 1,488,213 1,516,989 1,515,693 1,701,730 1,780,592
Current liabilities
541,292
184,646 221,560 352,541 148,286 229,779 198,688 359,424 152,295 221,502
Non-current liabilities
249,404
470,225 369,659 212,209 400,567 294,608 297,372 112,200 479,812 474,167
TOTAL LIABILITIES
790,696
654,871
591,219
564,750 548,853
524,387
496,060 471,624
632,107 695,669
NET ASSETS
836,602
881,837
878,154
940,028 902,790
963,826 1,020,929 1,044,069 1,069,623 1,084,923
RATIOS
Current assets to current liabilities
0.74
1.16
1.00
1.15
1.83
1.40
1.42
0.68
1.70
1.93
Borrowings to shareholders funds
81.7%
57.0%
50.2%
39.7%
35.4%
32.1%
26.1%
25.6%
39.9%
38.6%
Gearing
43.1%
34.6%
33.1%
28.2%
19.5%
13.7%
16.5%
16.7%
26.8%
27.1%
Tangible net asset backing per share (Kina)
24.38
25.84
25.74
27.85
26.65
28.62
30.46
31.21
32.03
32.52
Net profit to revenue %
12.8%
11.5%
5.9%
11.1%
8.5%
14.6%
16.0%
9.2%
8.7%
6.1%
Net profit to shareholders’ funds %
12.5%
10.1%
4.9%
7.6%
5.6%
8.3%
9.0%
5.6%
5.5%
4.3%
Underlying profit to shareholders’ funds %
10.2%
8.6%
7.3%
4.7%
3.6%
3.9%
6.7%
7.4%
4.8%
3.0%
Dividends per share (toea)
155
130
110
165
80
80
100
120
95
70
EPS (toea)
319.0
272.0
134.0
224.0
161.0
254.0
292.0
187.0
187.5
147.8
Underlying EPS (toea)
260
231
199
140
102
119
218
245
162
103
Earnings retained %
53.7%
52.2%
21.6%
62.1%
10.1%
78.4%
63.9%
38.5%
44.0%
32.4%
Notes
Earnings per share = profit attributable to shareholders / average shares in issue
Gearing = debt / debt plus equity
Interest cover = earnings before interest and tax / net finance charge
Dividend cover = profit attributable to shareholders / total dividend paid and provided
FINANCIAL HIGHLIGHTS
6 Steamships Annual Report 2024
“Steamships faced a challenging operating environment in 2024, with underlying economic
fundamentals remaining subdued. Inflationary pressures and limited foreign exchange availability
presented ongoing challenges. Steamships, despite such challenges, continued its commitment
to strategic investment in order to secure future sustainable growth. Geoff Cundle, Chairman.
CHAIRMAN’S REPORT
The broader economic landscape in 2024 was characterised
by sluggish growth, sustained inflationary pressure and
delays in natural resources projects.
Demand for Logistics services as well as Properties was
steady, however, Hospitality revenue has been facing
headwinds consistent with the market sector.
The Group achieved a significant milestone in the first
quarter with the opening of Harbourside South, its flagship
mixed-use development featuring Marriott Executive
Apartments. This development has enhanced the profile
of the downtown Harbourside precinct whilst introducing
Grade A office space and premium retail offering to the
market.
Group Revenue grew by 9.3% in 2024, driven by its
Logistics and Property divisions.
Profit attributable to shareholders decreased by 21.2%
to K45.8m: the considerable investment in both human
capital and assets that commenced in 2023 carried through
into 2024, further impacting margins and weighing on
profitability. This strategic investment was crucial to
developing workforce skills and strengthening assets in
preparation for the anticipated resources boom.
Underlying profit (before exceptional items) however,
declined 36.5% from 2023 to K31.9m.
Revenue from the Property division was supported by steady
demand across its portfolio; the acquisition of Portside
Business Park, along with the completion of renovation
works on key residential properties in Port Moresby and
Lae, expanded the division’s inventory and market leading
offering and will position the business for the anticipated
demand growth. Properties continues to invest in people
and technology to support its major developments and
planned growth in the coming years.
The Hospitality sector faced a challenging market
environment in 2024, marked by pricing pressures and a
slowdown in overseas visitors. However, a strong emphasis
on cost control and operational efficiencies helped offset
the impact on revenue. The division will undergo several
key renovation projects in 2025 to maintain its competitive
position.
Logistics, mainly comprising shipping, trucking, depot and
sundry marine services, remains competitive and prone
to both local and international inflationary pressures.
The investment in additional sea and land assets as well
as management capabilities generated an improved
performance in the second half despite lacklustre market
growth and absence of new resource projects.
I am very sad to report that two of our colleagues suffered
a fatal incident earlier this year. Our priority objective is,
and will always be, the pursuit of zero harm. The tragic
Steamships Annual Report 2024 7
CHAIRMAN’S REPORT
loss of two colleagues is a powerful reminder of the
need to maintain a relentless commitment to continuous
improvement in developing our safety culture.
With a strategic focus on long-term, sustainable growth,
Steamships remains committed to a longer term perspective
in developing its capabilities to serve the PNG market. In
2024, the Group continued its substantial investments
across its Property, Hospitality, and Logistics divisions,
ensuring it is well-equipped to capitalize on future growth
opportunities and upcoming projects.
Papua New Guinea is our home and principal place of
business, and we remain committed to actively foster its
economic and social advancement. The Board of Directors
would like to thank all our staff for their commitment and
personal dedication during what has been a challenging few
years for the entire country.
8 Steamships Annual Report 2024
DIRECTORS’ REVIEW
Steamships navigated a difficult operating landscape in 2024. The macroeconomic environment
was lacklustre, characterised by continuing inflation, limited foreign exchange availability and
lack of key natural resources projects which represent key drivers of demand across the nation.
From a top line perspective, the Group was able to balance
softer demand for its Hospitality services with stronger
revenue performance from Properties and Logistics.
To support its long-term strategic outlook, the Group
continued its significant investment in management
resources, sea and land-based assets and equipment to
position itself for the incoming growth.
Steamships’ sales revenue, on a continuing basis, increased
9.3% to K717.4 million against last year’s K656.3 million,
with improved revenue across the various businesses.
Underlying profit fell by 36.5% year-on-year, reflecting
a higher pressure on margin from investment in human
capital and assets.
Depreciation in 2024 was K113.5 million against K104.5
million in 2023, and interest expense on net borrowings
(excluding capitalised interest) was K6.1 million against
K1.7 million in 2023. Capital expenditure for the year was
K231.1 million against K222.8 million in 2023.
The Group’s net operating cash flow generation increased
by 29.6% to K134.3 million against K103.6 million in 2023.
The cash balance at year end is K3.9 million.
A final dividend of 30 toea per share has been proposed and
will be paid following approval at the Board of Directors
meeting on 20th June 2025, subject to Steamships’ ability
to secure foreign exchange for non-PNG shareholders. As
there was an interim dividend paid during the year of 40
toea per share, the total dividend for the year is 70 toea per
share (2023: 95 toea per share). The dividend is unfranked
and there is no conduit foreign income.
Steamships Annual Report 2024 9
DIRECTORS’ REVIEW
Significant items
January 10 events resulted in significant damage to some
of Steamships properties in Port Moresby. The Group was
insured for the property damage as well as loss of revenue,
lodged a claim with its insurer and received proceeds from
the claim.
Steamships was successful in disposing its North Waigani
property in 2024 with a gain of K8.6m on sale.
Steamships has embarked on a journey of digital
transformation to support its data driven decision making
through investment in a new Enterprise Resource Planning
platform, Microsoft Dynamics 365, with full implementation
due to be completed in by Q1 2026; the investment cost
in 2024 has been itemised as a significant item due to its
materiality.
The details are as follows:
K’000
Net insurance claim settlement income
– property damages
17,077
Gain on disposal of assets
12,250
ERP implementation expensed
(9,416)
Less Tax effects
(5,973)
Total
13,938
2024
2023
K000’s
K000’s
Change
Net profit attributable to shareholders
45,838
58,144
(21.2%)
Add / (Less) impact of significant items (post tax and minority interest)
Net insurance claim settlement income – property damages
(11,954)
-
Gain on disposal of assets
(8,575)
-
ERP implementation expensed
6,591
-
Blaikie insurance claim settlement
-
(7,904)
Total impact of significant items
(13,938)
(7,904)
Underlying profit attributable to shareholders
31,900
50,240
(36.5%)
10 Steamships Annual Report 2024
Coral Sea Hotels
Coral Sea Hotels (CSH) delivered a solid performance
across its portfolio, maintaining overall profitability despite
challenges from lower average room night rates, particularly
in Port Moresby’s softer market. A slight decline in revenue
compared to the previous year was offset by lower operating
costs.
Pacific Palms Property
The launch of the Harbourside South development - featuring
a mix of office, retail, and serviced apartments, including
the Marriott Executive Apartments - has strengthened Pacific
Palms Property’s (PPP) position as the premier destination
for luxury accommodation, premium office space, and
high-end retail, attracting blue-chip organisations.
Demand for premium commercial and residential properties
remains strong, and renovations on PPP’s new luxury
residential offerings at Whittaker Apartments (Port Moresby)
and Blaikie Apartments (Lae) have been completed. This
expansion enhances PPP’s offering and capacity within this
niche but high quality segment.
Logistics
While the Logistics division recorded year-on-year top-
line growth, cost pressures and continued supply chain
disruptions resulted in bottom-line performance falling short
of expectations.
Significant investments in logistics assets, workforce
development, and fleet maintenance have placed pressure
on margins. However, these investments are yielding
positive outcomes in terms of improved reliability and better
customer service. The expansion of marine assets, shore-
side equipment, and personnel is laying a strong foundation
for future growth, positioning the business to capitalise on
the upcoming resource boom.
Commercial
Colgate-Palmolive (PNG) Limited, a PNG incorporated
joint venture, was unfavorably affected by the events
that occurred on January 10 as most customers took a
conservative approach to stockholdings; although overall
financial performance was slightly weaker than prior year,
the last quarter showed improvement in volumes year on
year across most product categories signals promising
momentum for the year ahead.
DIRECTORS’ REVIEW
Steamships Annual Report 2024 11
Trading Outlook
The reopening of Porgera, the signing of the Pasca A Gas
Agreement and the announcement around a PNG Team
joining the NRL in 2028 has generated some optimism.
There is an expectation that natural resources projects will
gain traction from the 2nd half 2025 and will provide a
boost in what has been a relatively unremarkable macro-
economic environment.
Steamships will maintain a cautious approach to committing
capital to project related activity until final investment
decision is reached.
Compliance with Laws and Regulations
At Steamships we always aim to do the right thing, in the
right way and we make compliance and business integrity
non-negotiable.
For the 2024 financial year, the Directors declare that, to the
best of their knowledge, Steamships has not engaged in any
activities which materially contravene laws and regulations.
Outside Interests and Conflicts
Directors confirm that all material interests in contracts
involving the Group were declared and refrained from
voting on manners in which they were materially interested.
Shareholders Engagement
Steamships is dedicated to ensuring fair and equitable
treatment of all shareholders and offers diverse channels
of transparent communication for them to access the
Group’s information. Directors affirm that Steamships has
made every effort to ensure fair and equitable treatment of
all shareholders, implementing procedures that safeguard
shareholder rights and eliminate obstacles to the exercise
of those rights.
Going Concern Statement
Based on a robust assessment, the Directors confirm that
given the strong cash generation trend of the Group, as
well as the level of borrowing facilities available, they have
a reasonable expectation that the Group has adequate
resources to continue to operate for a period of at least 12
months from the date of approval of financial statements.
For this reason, they continue to adopt the going concern
basis of preparing the financial statements.
Internal Controls Effectiveness
The Directors confirm that they have reviewed the
effectiveness of internal controls and risk management
process and deem them to be appropriate.
Engagement with Traditional Landowners
Steamships’ success heavily relies on building and
maintaining close and supportive relationships with
communities and organisations that may be impacted by
the decisions we take; Steamships actively engages local
communities through inter alia collaboration with local
schools and universities, as well as inviting cross-sector
external partners on projects that bring community benefit
and support sustainable development within Papua New
Guinea.
CONSORT EXPRESS LINES
REVIEW OF OPERATIONS - LOGISTICS
Consort Express Lines (CEL) operates a fleet of 13
coastal vessels, all of which are PNG flagged, and is
PNG’s only domestic operator that is ISO accredited
for safety, environment and quality.
LINER SERVICES
CEL connects 13 ports around PNG to the main
international gateway ports of Lae and Port Moresby.
CEL also has scheduled services to the North Coast,
South Coast, New Guinea Islands, Bougainville, and
Western Province. CEL proudly serves the people
of PNG by providing an important supply link to
many of the communities on its routes. CEL carries
a range of cargoes including containerised, break-
bulk, reefer, LCL and project cargo. CEL transports
cargo for a diverse customer base from domestic
manufacturers and wholesalers to international liner
carriers transhipping cargo. In addition to owning
and operating ships, CEL manages PNG’s largest fleet
of containers offering customers easy access to a
wide range of container types.
PROJECT CHARTERS
CEL provides short and long-term vessel charters
specialising in shallow water river shipping, and
develops, implements, and supports intermodal
logistics solutions linked to land-based services such
as road transport, cargo handling, storage, customs
clearance, lay down areas and warehousing.
CEL’s liner performance in 2024 showed top line growth
compared to prior year largely as a result of increased
capacity.
In the second half of the year, significant efforts were
dedicated to enhancing fleet reliability, establishing a
fleet management team, and strengthening customer
engagement. These initiatives have delivered substantial
positive results, positioning CEL for sustainable growth.
There is renewed optimism within the logistics market that
resource projects will materialise in early 2026, increasing
demand on both its core liner network and also for project
and chartering activity. CEL looks to differentiate itself
through investment in modern technological and fleet
management systems as a comprehensive liner network and
tailored customer solutions through its integrated logistics
services.
12 Steamships Annual Report 2024
REVIEW OF OPERATIONS - LOGISTICS
PACIFIC TOWING
Pacific Towing is PNG’s leader in the provision
of a diverse range of marine services, enjoying a
reputation for excellence and reliability across the
region.
Pacific Towing is a full member of the International
Salvage Union and the International Spill Control
Organisation.
Core
services
include
towage,
mooring, salvage and commercial diving. Although
primarily operating in PNG waters, Pacific Towing
also services a broader area, if required, for salvage
activity or ad-hoc towing services.
Pacific Towing operates a fleet of 20 vessels (10
tugs and 10 associated support vessels including
the divers tender). Vessels are in five ports across
PNG (being Port Moresby, Lae, Rabaul, Kimbe and
Madang) and in Honiara, Solomon Islands. Pacific
Towing is the only marine services and towage
company in PNG to be ISO accredited for Quality,
Safety and Environment.
Both harbour towage as well as salvage activities increased
compared to prior year, underpinning growth in Pacific
Towing’s performance.
Developing local talent remain the key strategic pillar
supporting Pacific Towing operations, with continuous
investment in training and recruitment of cadets.
Pacific Towing is committed to a re-fleeting programme
that will phase out older tugs and will lead to incremental
investment in assets over the next few years.
Steamships Annual Report 2024 13
14 Steamships Annual Report 2024
REVIEW OF OPERATIONS - LOGISTICS
JOINT VENTURE PORT SERVICES
Joint Venture Port Services (JVPS) operate 16
stevedoring
and
cargo
handling
businesses
throughout the country including in the principal
ports of Port Moresby and Lae, secondary ports
elsewhere on the mainland and on Bougainville,
New Ireland and New Britain.
With a fleet of specialist equipment, the businesses
handle all types of containers, as well as project
cargo, break-bulk, RO-RO, LO-LO, grains, and
cement. The stevedoring companies are joint
ventures between Steamships and local landowner
groups at the respective ports around the country.
Each joint venture employs a local workforce and
is structured in a manner so that a significant share
of earnings is returned to the communities in which
the joint ventures operate. JVPS is the only group of
stevedoring and handling companies in PNG to be
ISO accredited for Quality, Safety and Environment.
The business continues to work hard to provide a
seamless logistics solution for customers in PNG.
JVPS performed in line with expectation.
Ensuring a secure, dependable, and cost-efficient service
for all customers has been a key priority. Security measures
have been further strengthened through the integration of
technology, including advanced cargo tracking.
The Joint Venture Hire company, which hires out heavy
machinery on wet and dry leases, continued to provide a
reliable service to all ports and to external customers. In
2025, the focus will be on safety, operational excellence
and fleet availability.
Steamships Annual Report 2024 15
REVIEW OF OPERATIONS - LOGISTICS
EASTWEST TRANSPORT
East West Transport (EWT) is one of Papua New
Guinea’s largest trucking companies, providing a
range of transport related activities.
It is ISO accredited for Environmental Management,
Occupational Health & Safety and Quality.
Based in Port Moresby, EWT has operations in
Lae, Kimbe, Rabaul, Madang, Wewak, Alotau, and
Kavieng. EWT has a sizable fleet of prime movers,
heavy and light trucks, forklifts and reach stackers
ranging from 2.5 to 80 tons in capacity. All equipment
is supported by localised workshop facilities,
safety teams, recovery vehicles, and emergency
response teams. EWT’s activities include bulk fuel,
containerised cargo, break-bulk cargo, and depot
services such as equipment hire, warehousing and
bonded or unbonded yard storage.
EWT also offers a licensed customs cargo clearance
service in Lae and Port Moresby with the ability
to clear cargo in any location where EWT has
a presence. The division capitalises on its close
relationships with sister companies in shipping and
stevedoring by offering specialised end-to-end and
door-to-door logistics and project solutions for the
mining, oil and gas sectors and new or existing
commercial sectors.
Market competitiveness in General Transport as well as
a relatively unstable fuel market meant that EWT faced
significant challenges to its profitability in 2024.
Fleet availability and on-time delivery showed significant
improvement compared to prior year, reflecting in an overall
improved financial performance, though still somehow
below management expectations.
Investment in new assets as well as management capabilities
is expected to deliver significant improvements in 2025.
16 Steamships Annual Report 2024
CORAL SEA HOTELS
REVIEW OF OPERATIONS - PROPERTY AND HOSPITALITY
Coral Sea Hotels (CSH) is the largest hotel group
in Papua New Guinea, managing seven hotels
throughout the country. CSH comprises of Grand
Papua Hotel, Gateway Hotel and Apartments, Ela
Beach Hotel and Apartments in Port Moresby, Huon
Gulf Hotel in Lae, Highlander Hotel and Apartments
in Mount Hagen, Bird of Paradise Hotel in Goroka
and Cassowary Hotel in Kiunga.
Port Moresby’s hotel market continues to face an oversupply
of rooms. Competitive pressure on average room rates
remained high in 2024, a year characterised by a lack of
significant diplomatic visits that tend to provide a boost
in demand. The performance of the hotels outside Port
Moresby in the regional centres were solid.
The focus on operational efficiencies compensated for an
unremarkable top line performance; the division continues
to invest in training and recruiting the best people as well as
expanding its premium F&B offerings.
CSH aims to prioritise delivering reliable, high-quality,
and affordable hospitality across its hotels and restaurants.
In line with this commitment, Coral Sea Hotels will invest
heavily in 2025 to upgrade its properties throughout Papua
New Guinea in order to refresh both its 5-star product
offering at the Grand Papua Hotel in Port Moresby, its mid-
scale product across the country and elevate the overall
guest experience.
Steamships Annual Report 2024 17
PACIFIC PALMS PROPERTY
REVIEW OF OPERATIONS - PROPERTY AND HOSPITALITY
With a portfolio of over 200 properties across
Residential, Commercial, Retail, and Industrial
asset classes in Port Moresby, Lae, Madang, Wewak,
Goroka, Mount Hagen, and Rabaul, Pacific Palms
Property (PPP) is one of the premier property
developers and managers in PNG.
PPP’s strategy of investing in projects of scale and
quality, in diversified real estate asset classes, in both
established and upcoming locations, results in stable
revenues, net operating income, and cashflow.
The division continued its growth trajectory, underpinned
by a high-quality diversified portfolio of residential,
commercial, industrial and retail properties.
The completion of Blaikie (Lae) and Whittaker (Port
Moresby) residential properties will add further inventory to
its premium residential offering in both towns.
Significant progress was made with Dobel Shopping Centre,
Mount Hagen’s first large scale, mixed-used development
with construction expected to start in early 2025.
Infrastructure construction on Portside Business Park started
towards the end of 2024 and is expected to be completed
in late 2025.
PPP continues its commitment to investing in green
technology and green building standards in all its
developments. With its existing portfolio of ready for
occupancy properties and its landbank of properties with
secure titles in key strategic locations, PPP is well positioned
to benefit from an uptick in demand for real estate once the
resource projects ramp-up.
18 Steamships Annual Report 2024
Steamships’ commitment to Sustainable Development has been underpinned by the resolution
of the Board of Directors that the Group will achieve net zero emissions across all three scopes
by 2050. This is an ambitious target for a diverse conglomerate operating in an emerging market,
but one that we see as imperative as we support PNG to achieve its corresponding national
development goals.
SUSTAINABILITY
In a world where environmental concerns are increasingly
influencing business operations, we remain dedicated
to navigating the challenges and opportunities posed by
climate change. Our commitment includes taking practical
steps to decarbonise our operations and setting ambitious,
science-based targets to achieve net zero emissions by 2050,
with interim milestones along the way, all in alignment with
our THRIVE sustainability pillars: Climate, Waste, Water,
People, and Community.
We continue our efforts to improve our environment
stewardship on a day-to-day basis. Actively engaging in
various Environmental, Social and Governance (ESG)
forums and technical working groups is essential for
aligning our business with evolving policy and regulatory
developments. Given that Steamships operates across three
distinct industries, this alignment is crucial. While our
Property and Hospitality divisions have more opportunities
for decarbonization, our Shipping division is faced with
some considerable challenges given the technological and
regulatory hurdles it faces. Nonetheless, we continue to
explore innovative solutions and collaborate with industry
stakeholders to drive progress.
Key Achievements:
In 2024, our emissions performance saw a modest increase
of 1% in Scope 1 emissions compared to 2023. Scope 2
emissions rose by 13%, driven by the expansion of our
property portfolio. Although our Scope 3 emissions are
primarily based on secondary data, we have now begun
tracking emissions from all business air travel, which are
measured annually and offset.
Our safety performance was reflected by both improvements
and challenges. We observed a positive downward trend in
major injuries (LTIs), which decreased by 5 incidents and
minor injuries dropping from 19 to 10, reflecting our ongoing
safety efforts. Near Miss reports reduced from 1646 to 1325,
indicating improved hazard management and a shift in our
safety reporting culture from “Target 2,” which focused on
Near Miss statistics, to a more quality driven approach to
hazard reporting. Regrettably, Steamships experienced 2
fatalities during the year, prompting a reassessment of our
strategy and the application of rigorous action and a wide-
spread campaign across the business on critical areas and
initiatives that will support our Safety journey. With the
launch of our revised strategy, “Safety First, Safety Always,”
we aim to incorporate safety programmes that drive a
culture of behavioural change towards achieving zero harm.
Promoting awareness and education among employees
continues to be a key goal with emphasis on both
compliance training and broader development initiatives.
In 2024, we completed 53,373 man-hours of training.
Most of our professional and leadership programmes
were successfully delivered. Looking ahead, our focus
is to expand behavioural and short-term competency
programmes to boost productivity, workplace compliance,
and team efficiency, with early signs indicating strong
employee engagement.
Our diversity performance saw an improvement of 2%
compared to 2023 of our total female population. Women
now hold 24% of senior management roles, reflecting
a 4% rise since 2023. Additionally, we have enhanced
female representation on our Board with the appointment
of Christine Kasou as a Non-Executive Director. We are
committed to further enhancing gender diversity across
all levels of our organization and continue to implement
initiatives to support and promote women in leadership and
technical roles.
Beyond our core business activities, we are committed to
cultivating long-term, mutually rewarding relationships with
our partners and the communities in which we operate.
In the past year, our Community Grants Programme has
supported various initiatives, allocating 10% of the grants to
both Education and Health initiatives, while 24% and 56%
were allocated to Social and Environmental programmes
respectively. We look forward to continuing this support,
empowering community beneficiaries to build their
communities and positively impact lives.
As our business grows, we remain conscious of the
importance of sustainable growth. We are fully committed to
empowering our people and communities while responsibly
managing our environmental impact.
Steamships Annual Report 2024 19
CORPORATE GOVERNANCE
Steamships, its employees and its board are committed to achieving and demonstrating the
highest standards of corporate governance and ethical behaviour. The Group believes that
the maximisation of long-term returns to shareholders is best achieved by acting in a socially
responsible manner that recognises the interests of community stakeholders.
Steamships is committed to:
•
Providing high-quality products and services to meet
customers’ needs;
•
Maintaining high standards of business ethics and
corporate governance;
•
Ensuring the safety and wellbeing of employees and
others with whom the Group has contact; and
•
Promoting sustainable business practice.
Steamships reports against the Australian Stock Exchange
(ASX) recommendations by addressing each key principle
in the order it is listed in the ASX guidelines. Each section
addressing a key principle includes references to relevant
information that appears elsewhere in the 2024 Annual
Report or on the Steamships’ website. Steamships believes
it complied with the ASX Corporate Governance Principles
(the fourth edition) during the twelve months ended 31
December 2024, except where noted in the Corporate
Governance Report.
Steamships’
Corporate
Governance
Report
can
be
found
at
https://www.steamships.com.pg/about-us/
corporate-governance
20 Steamships Annual Report 2024
STATEMENTS OF COMPREHENSIVE INCOME
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s)
Consolidated
Parent Entity
Note
2024
2023
2024
2023
Continuing Operations
Revenue
3(a)
717,380
656,290
72,767
11,503
Other income
3(a)
29,643
13,006
2,248
5,098
Operating expenses
3(b)
(677,625)
(590,541)
(2,744)
(1,692)
OPERATING PROFIT
69,398
78,755
72,271
14,909
Finance income
3(e)
13,604
14,174
85
85
Finance costs
3(e)
(19,722)
(15,826)
-
-
Share of profit of associates and joint ventures
4(b)
6,141
7,286
-
-
PROFIT BEFORE INCOME TAX
69,421
84,389
72,356
14,994
Income tax expense
5(a)
(22,429)
(25,722)
(46)
(1,047)
PROFIT FROM CONTINUING OPERATIONS
46,992
58,667
72,310
13,947
PROFIT FOR THE YEAR
46,992
58,667
72,310
13,947
TOTAL COMPREHENSIVE INCOME FOR THE YEAR
attributable to:
Non-controlling interests
1,154
523
-
-
Shareholders
45,838
58,144
72,310
13,947
46,992
58,667
72,310
13,947
TOTAL COMPREHENSIVE INCOME FOR THE YEAR
attributable to owners arises from:
Continuing operations
45,838
58,144
72,310
13,947
Basic and diluted earnings per share
Continuing operations (toea)
3(f)
147.8t
187.5t
-
-
These Statements of Comprehensive Income are to be read in conjunction with the accompanying notes.
Steamships Annual Report 2024 21
STATEMENTS OF CHANGES IN EQUITY
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s)
Non-
Consolidated
Share
Retained
Other
Total Capital
Controlling
Total
Capital
Earnings
Reserves and Reserves
Interest
Equity
BALANCE AT 1 JANUARY 2023
24,200
1,043,105
(40,295)
1,027,010
17,059
1,044,069
Profit for the year
-
58,144
-
58,144
523
58,667
Dividends paid 2023
-
(32,559)
-
(32,559)
(554)
(33,113)
BALANCE AT 31 DECEMBER 2023
24,200
1,068,690
(40,295)
1,052,595
17,028
1,069,623
Profit for the year
-
45,838
-
45,838
1,154
46,992
Dividends paid 2024
-
(31,008)
-
(31,008)
(684)
(31,692)
BALANCE AT 31 DECEMBER 2024
24,200
1,083,520
(40,295)
1,067,425
17,498
1,084,923
Parent Entity
Share
Retained
Total
Capital
Earnings
Equity
BALANCE AT 1 JANUARY 2023
24,200
34,303
58,503
Profit for the year
-
13,947
13,947
Dividends paid 2023
-
(32,559)
(32,559)
BALANCE AT 31 DECEMBER 2023
24,200
15,691
39,891
Profit for the year
-
72,310
72,310
Dividends paid 2024
-
(31,008)
(31,008)
BALANCE AT 31 DECEMBER 2024
24,200
56,993
81,193
These Statements of Changes in Equity are to be read in conjunction with the accompanying notes.
There is no other comprehensive income.
22 Steamships Annual Report 2024
STATEMENTS OF FINANCIAL POSITION
Steamships Trading Company Limited As At 31 December 2024 (Amounts in Kina 000’s)
Consolidated
Parent Entity
Note
2024
2023
2024
2023
Current assets
Cash and cash equivalents
6
27,800
28,804
-
-
Trade and other receivables
7
159,987
184,726
878
45,298
Inventories
8
47,073
39,480
-
-
Income tax receivable
5(e)
14,329
5,163
239
-
Asset held for sale
10
455
-
-
-
249,644
258,173
1,117
45,298
Non-current assets
Property, plant and equipment
10
832,366
692,559
60,880
22,995
Investment properties
11
409,061
381,374
-
-
Investments in related companies
4(a)
51,562
45,495
55,299
55,252
Due from related companies
9
156,646
243,069
3,055
9,531
Intangible assets
12
76,433
76,433
-
-
Deferred tax assets
5(c)
4,880
4,627
786
832
1,530,948
1,443,557
120,020
88,610
TOTAL ASSETS
1,780,592
1,701,730
121,137
133,908
Current liabilities
Trade and other payables
13
138,482
108,680
17
-
Lease liabilities
14
2,280
2,576
-
-
Provisions for other liabilities and charges
15
6,710
6,122
33
-
Due to related companies
9
2,305
1,862
39,894
93,982
Due to a minority shareholder
16
160
160
-
-
Borrowings
16
71,565
32,895
-
-
Income tax payable
5(e)
-
-
-
35
221,502
152,295
39,944
94,017
Non-current liabilities
Other payables
13
29,414
-
-
-
Lease liabilities
14
53,496
55,234
-
-
Deferred tax liabilities
5(c)
34,026
28,086
-
-
Provisions for other liabilities and charges
15
12,386
11,191
-
-
Borrowings
16
344,845
385,301
-
-
474,167
479,812
-
-
TOTAL LIABILITIES
695,669
632,107
39,944
94,017
NET ASSETS
1,084,923
1,069,623
81,193
39,891
EQUITY
Share capital
17
24,200
24,200
24,200
24,200
Reserves
1,043,225
1,028,395
56,993
15,691
Capital and reserves attributable to the
Company’s shareholders
1,067,425
1,052,595
81,193
39,891
Non-controlling interests
17,498
17,028
-
-
TOTAL EQUITY
1,084,923
1,069,623
81,193
39,891
These Statements of Financial Position are to be read in conjunction with the accompanying notes.
For and on behalf of the Board:
G.L. Cundle
C.K. Daniells
31 March 2025
Chairman
Managing Director
Steamships Annual Report 2024 23
STATEMENTS OF CASH FLOWS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s)
Consolidated
Parent Entity
Note
2024
2023
2024
2023
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers
742,119
627,185
2,248
2,401
Payments to suppliers and employees
(555,176)
(493,706)
(735)
-
Interest received
11,932
2,401
85
85
Interest and other finance costs paid
(18,494)
(15,826)
-
-
Income tax paid
5(e)
(23,802)
(16,495)
(261)
(137)
Net cash from operating activities
19(a)
156,579
103,559
1,337
2,349
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment
(231,122)
(222,769)
(39,894)
-
Proceeds from sale of property, plant and equipment
14,021
6,370
-
-
Subscription of additional shares in joint venture companies
(48)
(3,500)
(48)
(3,500)
Net loans issued to associated companies
(3,134)
(32,611)
(68,339)
(622)
Loan repaid by a joint venture
90,000
-
90,000
-
Dividends received from joint venture and associates
8,058
2,656
8,058
3,502
Net cash used in investing activities
(122,225)
(249,854)
(10,223)
(620)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from borrowings
120,000
185,000
-
-
Repayments of borrowings
(120,000)
(30,000)
-
-
Loans received from subsidiaries
-
-
39,894
30,830
Lease repayments
(2,336)
(2,597)
-
-
Dividends paid
(31,692)
(33,113)
(31,008)
(32,559)
Net cash (used in) / from financing activities
(34,028)
119,290
8,886
(1,729)
NET INCREASE / (DECREASE) IN CASH HELD
326
(27,005)
-
-
NET CASH AT BEGINNING OF THE YEAR
25,909
52,914
-
-
NET CASH AT END OF THE YEAR
26,235
25,909
-
-
CASH COMPRISES:
Cash and cash equivalents
6
27,800
28,804
-
-
Bank overdrafts
16
(1,565)
(2,895)
-
-
26,235
25,909
-
-
These Statements of Cash Flows are to be read in conjunction with the accompanying notes.
Comparative period amounts have been restated to conform to presentations in the current year.
24 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
1. Summary of material accounting policies
The Company is a company limited by shares and is
incorporated and domiciled in Papua New Guinea.
These Group consolidated financial statements were
authorised for issue by the Board of Directors on
31 March 2025.
The Board of Directors has the power to amend the
financial statements after their issue.
(a) Basis of preparation
The financial statements have been prepared in
accordance with the Papua New Guinea Companies
Act 1997 (as amended) and comply with International
Financial Reporting Standards (IFRS) and IFRS
Interpretations Committee (IFRS IC) interpretations
applicable to companies reporting under IFRS and
other generally accepted accounting practice in Papua
New Guinea. The financial statements have been
prepared under the historical cost convention.
The preparation of financial statements in conformity
with IFRS requires the use of certain critical accounting
estimates. It also requires management to exercise its
judgement in the process of applying the Company’s
accounting policies. The areas involving a higher
degree of judgement or complexity, or areas where
assumptions and estimates are significant to the
financial statements are disclosed in Note 1(z).
(i) Standards,
amendments
and
interpretations
effective in the year ended 31 December 20242
The
following
standards,
amendments
and
interpretations to existing standards became applicable
for the first time during the accounting period ended
31 December 2024.
•
Amendment to IAS 1 - Non-current liabilities with
covenants. These amendments clarify how conditions
which an entity must comply within twelve months
after the reporting period affect the classification
of a liability. The amendments also aim to improve
information an entity provides related to liabilities
subject to these amendments.
•
Amendment to IFRS 16 - Leases on sale and leaseback.
These amendments include requirements for sale and
leaseback transactions in IFRS 16 to explain how an
entity accounts for a sale and leaseback after the date
of the transaction. Sale and leaseback transactions
where some or all the lease payments are variable
lease payments that do not depend on an index or
rate are most likely to be impacted.
•
Amendment to IAS 7 and IFRS 7 - Supplier finance.
These amendments require disclosures to enhance
the transparency of supplier finance arrangements
and their effects on an entity’s liabilities, cash
flows and exposure to liquidity risk. The disclosure
requirements are the IASB’s response to investors’
concerns that some companies’ supplier finance
arrangements are not sufficiently visible, hindering
investors’ analysis.
The above changes did not have any material impact on
the Group.
(ii) Standards,
amendments
and
interpretations
issued but not yet effective for the year ended 31
December 2024 or adopted early
The
following
standards,
amendments
and
interpretations to existing standards have been
published and are mandatory for the entity’s accounting
periods beginning on or after 1 January 2025 or later
periods, but the entity has not early adopted them:
•
Amendments to IAS 21 – Lack of Exchangeability
(effective 1 January 2025 - early adoption is
available). An entity is impacted by the amendments
when it has a transaction or an operation in a
foreign currency that is not exchangeable into
another currency at a measurement date for a
specified purpose. A currency is exchangeable
when there is an ability to obtain the other
currency (with a normal administrative delay), and
the transaction would take place through a market
or exchange mechanism that creates enforceable
rights and obligations.
•
Amendment to IFRS 9 and IFRS 7 – Classification
and Measurement of Financial (effective 1 January
2026 - early adoption is available).
These amendments:
•
clarify the requirements for the timing of
recognition and derecognition of some
financial assets and liabilities, with a new
exception for some financial liabilities settled
through an electronic cash transfer system;
•
clarify and add further guidance for assessing
whether a financial asset meets the solely
payments of principal and interest (SPPI)
criterion;
•
add new disclosures for certain instruments
with contractual terms that can change cash
flows (such as some instruments with features
linked to the achievement of environment,
social and governance (ESG) targets); and
•
make updates to the disclosures for equity
instruments designated at Fair Value through
Other Comprehensive Income (FVOCI).
•
Annual improvements to IFRS – Volume 11
(effective 1 January 2026 - with earlier application
permitted). Annual improvements are limited
Steamships Annual Report 2024 25
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
to changes that either clarify the wording in an
Accounting Standard or correct relatively minor
unintended consequences, oversights or conflicts
between the requirements in the Accounting
Standards. The 2024 amendments are to the
following standards:
•
IFRS 1 First-time Adoption of International
Financial Reporting Standards;
•
IFRS 7 Financial Instruments: Disclosures and
its accompanying Guidance on implementing
IFRS 7;
•
IFRS 9 Financial Instruments;
•
IFRS 10 Consolidated Financial Statements;
and
•
IAS 7 Statement of Cash Flows.
•
IFRS 18 Presentation and Disclosure in Financial
Statements (effective 1 January 2027). This is the
new standard on presentation and disclosure
in financial statements, with a focus on updates
to the statement of profit or loss. The key new
concepts introduced in IFRS 18 relate to:
•
the structure of the statement of profit or loss;
•
required disclosures in the financial statements
for certain profit or loss performance measures
that are reported outside an entity’s financial
statements (that is, management-defined
performance measures); and
•
enhanced principles on aggregation and
disaggregation which apply to the primary
financial statements and notes in general.
The Group continues to assess the impact of adopting
Standards, amendments and interpretations issued
but not yet effective for the year ended 31 December
2024.
New IFRS sustainability disclosure standards effective
after 1 January 2025
•
IFRS S1, ‘General requirements for disclosure
of sustainability-related financial information
(effective 1 January 2024 - This is subject to
endorsement by the Accounting Standards Board of
PNG). This standard includes the core framework
for the disclosure of material information about
sustainability-related
risks
and
opportunities
across an entity’s value chain.
•
IFRS S2, ‘Climate-related disclosures’ (effective
1 January 2024 - This is subject to endorsement
by the Accounting Standards Board of PNG). This
is the first thematic standard issued that sets out
requirements for entities to disclose information
about climate-related risks and opportunities.
(iii) Comparative information
Where necessary comparative figures have been
adjusted to conform to changes in presentation in
the current year and comparative purposes.
(b) Foreign currency
The Company’s functional and presentation currency
is the Papua New Guinea Kina. Transactions in foreign
currencies have been translated into the functional
currency at rates ruling at the date of the transaction.
Amounts payable to and by the Group in foreign
currencies have been translated to the functional
currency at rates of exchange ruling at the year end.
Gains and losses arising from movements in foreign
exchange rates are recognised in the statements of
comprehensive income when they arise.
(c) Principles of consolidation
(i) Subsidiaries
The consolidated financial statements incorporate the
assets and liabilities of all subsidiaries of Steamships
Trading Company Limited as at 31 December 2024
and the results of all subsidiaries for the year then
ended. Steamships Trading Company Limited and its
subsidiaries together are referred to as the Group or the
consolidated entity.
Subsidiaries are all entities over which the Group has
control, that is when the Group is exposed to, or has
rights to, variable returns from its involvement with the
entity and has the ability to affect those returns through
its power over the entity.
Subsidiaries are fully consolidated from the date on
which control is transferred to the Group. They are de-
consolidated from the date that control ceases.
The acquisition method of accounting is used to
account for business combinations by the Group (refer
to Note 1(d).
Intercompany transactions, balances and unrealised
gains on transactions between group companies are
eliminated. Unrealised losses are also eliminated
unless the transaction provides evidence of the
impairment of the asset transferred. Accounting policies
of subsidiaries have been changed where necessary to
ensure consistency with the policies adopted by the
Group.
Non-controlling interests in the results and equity of
subsidiaries are shown separately in the statements
of comprehensive income, statements of changes in
equity and statement of financial position, respectively.
(ii) Associates
Associates are all entities over which the Group
has significant influence but not control generally
accompanying a shareholding of between 20% and
26 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
50% of the voting rights. Investments in associates are
accounted for using the equity method of accounting,
after initially being recognised at cost. The Group’s
investment in associates includes goodwill identified
on acquisition.
The Group’s share of its associates’ post-acquisition
profits or losses is recognised in profit or loss, and its
share of post-acquisition other comprehensive income
is recognised in other comprehensive income. The
cumulative post-acquisition movements are adjusted
against the carrying amount of the investment.
Dividends receivable from associates are recognised as
a reduction in the carrying amount of the investment.
When the Group’s share of losses in an associate
equals or exceeds its interest in the associate,
including any other unsecured long-term receivables,
the Group does not recognise further losses, unless it
has incurred obligations or made payments on behalf
of the associate.
Unrealised gains on transactions between the Group
and its associates are eliminated to the extent of the
Group’s interest in the associates. Unrealised losses
are also eliminated unless the transaction provides
evidence of an impairment of the asset transferred.
Accounting policies of associates have been changed
where necessary to ensure consistency with the
policies adopted by the Group.
(iii) Joint ventures
Joint venture entities
Interests in joint ventures are accounted for using the
equity method after initially being recognised at cost as
for associates.
(iv) Changes in ownership interests
The Group treats transactions with non-controlling
interests that do not result in a loss of control as
transactions with equity owners of the Group. A
change in ownership interest results in an adjustment
between the carrying amounts of the controlling
and non-controlling interests to reflect their relative
interests in the subsidiary. Any difference between the
amount of the adjustment to non-controlling interests
and any consideration paid or received is recognised
in a separate reserve within equity attributable to
shareholders.
When the Group ceases to have control or significant
influence, any retained interest in the entity is re-
measured to its fair value with the change in carrying
amount recognised in profit or loss. This fair value
becomes the initial carrying amount for the purposes of
subsequently accounting for the retained interest as an
associate or financial asset. In addition, any amounts
previously recognised in other comprehensive income
in respect of that entity are accounted for as if the Group
had directly disposed of the related assets or liabilities.
This may mean that amounts previously recognised in
other comprehensive income are reclassified to profit
or loss.
If the ownership interest in a jointly controlled entity
or an associate is reduced but significant influence is
retained, only a proportionate share of the amounts
previously recognised in other comprehensive income
is reclassified to profit or loss where appropriate.
(d) Business combinations
The acquisition method of accounting is used to
account for all business combinations, regardless
of whether equity instruments or other assets are
acquired. The consideration transferred for the
acquisition of a subsidiary comprises the fair values of
the assets transferred, the liabilities incurred and the
equity interests issued by the Group. The consideration
transferred also includes the fair value of any asset
or liability resulting from a contingent consideration
arrangement and the fair value of any pre-existing
equity interest in the subsidiary. Acquisition-related
costs are expensed as incurred. Identifiable assets
acquired and liabilities and contingent liabilities
assumed in a business combination are measured
initially at their fair values at the acquisition date.
On an acquisition-by-acquisition basis, the Group
recognises any non-controlling interest in the acquiree
either at fair value or at the non-controlling interest’s
proportionate share of the acquiree’s net identifiable
assets.
The excess of the consideration transferred, the
amount of any non-controlling interest in the acquiree
and the acquisition date fair value of any previous
equity interest in the acquiree over the fair value of the
Group’s share of the net identifiable assets acquired is
recorded as goodwill. If those amounts are less than the
fair value of the net identifiable assets of the subsidiary
acquired and the measurement of all amounts has
been reviewed, the difference is recognised directly in
determining profit or loss as a bargain purchase.
Where settlement of any part of cash consideration
is deferred, the amounts payable in the future are
discounted to their present value as at the date of
exchange. The discount rate used is the entity’s
incremental borrowing rate, being the rate at which
a similar borrowing could be obtained from an
Steamships Annual Report 2024 27
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
independent financier under comparable terms and
conditions.
Contingent consideration is classified either as equity
or a financial liability. Amounts classified as a financial
liability are subsequently re-measured to fair value
with changes in fair value recognised in profit or loss.
Predecessor accounting is applied for business
combinations among entities under common control,
including acquisitions of entities and amalgamations
of entities under common control. Under this method,
the financial statements of the combined entity are
presented as if the businesses had been combined
from the date when the combining entities were
amalgamated. Assets and liabilities of the acquired or
amalgamated entity are stated at predecessor carrying
values. Fair value measurement is not required and no
new goodwill arises in predecessor accounting. Any
difference between the consideration given and the
aggregate book value of the assets and liabilities of
the acquired or amalgamated entity at the date of the
transaction is included in equity in retained earnings.
(e) Revenue recognition
Revenue which represents income arising in the
course of the Group’s ordinary activities is recognised
by reference to each distinct performance obligation
promised in the contract with the customer when
or as the Group transfers the control of the goods
or services promised in a contract to the customer.
Depending on the substance of the respective contract
with the customer, the control of the promised goods
or services may transfer over time or at a point in time.
A contract with a customer exists when the contract
has commercial substance, the Group and its customer
have approved the contract and intend to perform their
respective obligations, the Group’s and the customer’s
rights regarding the goods or services to be transferred
and the payment terms can be identified, and it is
probable that the Group will collect the consideration
to which it will be entitled to in exchange of those
goods or services. At the inception of each contract
with a customer, the Group assesses the contract
to identify distinct performance obligations, being
the units of account that determine when and how
revenue from the contract with the customer is
recognised. A performance obligation is a promise to
transfer a distinct good or service (or a series of distinct
goods or services that are substantially the same and
that have the same pattern of transfer) to the customer
that is explicitly stated in the contract and implied in
the Group’s customary business practices. A good or
service is distinct if:
-
the customer can either benefit from the good or
service on its own or together with other readily
available resources; and
-
the good or service is separately identifiable from
other promises in the contract (e.g. the good or
service is not integrated with, or highly interrelated
with, other goods or services promised in the
contract)
If a good or service is not distinct, the Group combines
it with other promised goods or services until the
Group identifies a distinct performance obligation
consisting of a distinct bundle of goods or services.
As disclosed in Note 24, revenue from external
customers comes from the logistics business, property
and hospitality business, and commercial business.
Revenue from the logistics business includes revenue
from providing the following services: freight and
shipping activities, land transport activities, towage
and salvage activities, and sale of goods.
Revenue from freight and shipping services, land
transport services and towage services are recognised
over time as the performance obligation (in this case
transport or towage activity) is performed taking into
consideration the days of shipment. In case of sale of
goods (such as containers), revenue is recognised at a
point in time.
Payment terms for freight and shipping services and
land transport services are typically 30 days; payment
terms for towage services are typically within 30 days
after completion of service delivery.
Salvage revenue is recognised over time as the
performance obligation (in this case salvaging activity)
is performed, based on the days of provision of service,
or at a point in time (upon completion of the salvage
job), depending on the nature of the salvage activity and
the contractual terms. The Group recognises salvage
revenue over time if the customer simultaneously
receives and consumes the benefits provided by the
Group’s performance as the Group performs. In such
cases, the Group typically has a right to payment based
on work performed until the reporting date. The Group
recognises salvage revenue at a point in time when the
customer does not simultaneously receive and consume
the benefits provided by the Group’s performance as
the Group performs and has no enforceable right to
payment for performance completed to date.
Payment terms for salvage work vary between one and
three months. Where salvage work is completed but
the amount of proceeds is not known at the reporting
date, revenue is determined on the basis of expected
proceeds taking into account estimation uncertainty.
28 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
The estimated amount of consideration will be
recognised as revenue only to the extent that it is highly
probable that a significant reversal in the amount of
cumulative revenue recognised will not occur when
the uncertainty associated with the consideration is
subsequently resolved.
The Group incurs costs needed to fulfil salvage contracts
and defers these costs incurred directly related to
salvage work, if their recovery is considered probable
based on management’s assessment. If management’s
assessment suggests the expenses are not expected to
be recovered, the estimated unrecoverable portion is
expensed when incurred. Probability of recoverability
of initially recognised deferred salvage costs is assessed
at the end of each reporting period. In the reporting
period when management’s assessment suggests that
these expenses will not likely be recovered by revenues
(i.e. the related contract asset is deemed impaired),
the estimated unrecoverable portion is expensed.
Deferred salvage costs are amortised in profit or loss
on a systematic basis consistent with the pattern of
recognition of the associated revenue.
Revenue from the hotels business from provision of
services is recognised over time based on the days of
provision of service; payments for provided services
are made upon service delivery. Revenue from sale
of goods in hotels business is recognised at a point in
time upon delivery of goods under typical credit term
of 30 days or in cash. Lease income from the property
business is recognised on a straight-line basis over the
term of the lease.
Revenue from the commercial business relates to
sale of goods and is recognised when the goods are
accepted by the customers, under typical payment
terms of 30 days after the delivery of goods.
The following other income is recognised across the
Group as follows:
Interest income
Interest income is recognised using the effective
interest method.
Dividend income
Dividends are recognised when the right to receive
payment is established.
(f) Income tax
The income tax expense or benefit for the period is
the tax payable on the current period’s taxable income
based on the notional income tax rate adjusted by
changes in deferred tax assets and liabilities attributable
to temporary differences between the tax bases of
assets and liabilities and their carrying amounts in the
financial statements, and to unused tax losses.
Deferred income tax is provided on temporary
differences arising between the tax bases of assets and
liabilities and their carrying amounts in the financial
statements. Deferred tax is not recognised if it arises
from the initial recognition of goodwill or the initial
recognition of an asset or liability in a transaction
which is not a business combination and at the time
of the transaction, affects neither accounting profit nor
taxable profit (tax loss). Currently enacted tax rates are
used in the determination of deferred income tax.
Deferred tax assets are recognised to the extent that it
is probable that future taxable profit will be available,
against which the temporary differences can be
utilised.
(g) Cash and cash equivalents
For the purpose of the statements of cash flows,
cash and cash equivalents includes cash on hand
and deposits held at call with banks with an original
maturity of up to 3 months. Bank overdrafts are shown
in current liabilities in the statements of financial
position.
(h) Receivables
Trade receivables are amounts due from customers for
merchandise sold or services provided in the ordinary
course of business. They are classified as current assets
if collection is expected within one year. Receivables
are recognised initially at fair value and subsequently
measured at amortised cost using the effective interest
method, less provision for impairment.
(i) Inventories
Inventories are valued at the lower of cost and net
realisable value. In general, cost is determined on
the weighted average basis and, where appropriate,
includes a proportion of variable overhead expenditure.
Net realisable value is the estimated selling price in the
ordinary course of business, less applicable variable
selling costs.
(j) Non-current assets held for resale
Non-current assets (or disposal groups) are classified
as held for sale if their carrying amount will be
recovered principally through a sale transaction rather
than through continuing use and a sale is considered
highly probable. They are measured at the lower of
their carrying amount and fair value less costs to sell,
except for assets such as deferred tax assets, assets
Steamships Annual Report 2024 29
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
arising from employee benefits, financial assets and
contractual rights under insurance contracts, which are
specifically exempt from this requirement.
An impairment loss is recognised for any initial or
subsequent write down of the asset (or disposal group)
to fair value less costs to sell. A gain is recognised for
any subsequent increases in fair value less costs to sell
of an asset (or disposal group), but not in excess of any
cumulative impairment loss previously recognised. A
gain or loss not previously recognised by the date of
the sale of the non-current asset (or disposal group) is
recognised at the date of derecognition.
Non-current assets (including those that are part of
a disposal group) are not depreciated or amortised
while they are classified as held for sale. Interest
and other expenses attributable to the liabilities of a
disposal group classified as held for sale continue to be
recognised.
Non-current assets classified as held for sale and the
assets of a disposal group classified as held for sale
are presented separately from the other assets in the
statements of financial position. The liabilities of a
disposal group classified as held for sale are presented
separately from other liabilities in the statements of
financial position.
A discontinued operation is a component of the entity
that has been disposed of or is classified as held
for sale and that represents a separate major line of
business or geographical area of operations, is part
of a single coordinated plan to dispose of such a line
of business or area of operations, or is a subsidiary
acquired exclusively with a view to resale. The results
of discontinued operations are presented separately in
the statements of comprehensive income.
(k) Financial assets
The Group classifies all of its financial assets in the
measurement category ‘Financial assets at amortised
cost’.
The Group classifies its financial assets at amortised
cost when the asset is held within a business model
whose objective is to collect the contractual cash
flows and the contractual terms give rise to cash flows
that are solely payments of principal and interest
(“SPPI”). Financial assets of the Group that fall under
this category are trade and other receivables, bank
balances, deposits and cash, and loans to related
companies.
At initial recognition, the Group measures a financial
asset at its fair value plus transaction costs that are
directly attributable to the acquisition of the financial
asset. Interest income from these financial assets is
included in finance income using the effective interest
rate method. Any gain or loss arising on derecognition
is recognised directly in profit or loss and presented in
other gains and losses together with foreign exchange
gains and losses.
As of 31 December 2024 and 31 December 2023,
the Group had no financial instruments classified
as financial assets at fair value through other
comprehensive income (“FVOCI”) - Equity instruments
or financial assets at fair value through profit or loss
(“FVTPL”).
Regular way purchases and sales of financial assets are
recognised on trade-date, the date on which the Group
commits to purchase or sell the asset. Financial assets
are derecognised when the rights to receive cash flows
from the financial assets have expired or have been
transferred and the Group has transferred substantially
all the risks and rewards of ownership.
Financial assets are classified as current assets for those
having maturity dates of not more than 12 months after
the end of the reporting period, and the balance is
classified as non-current.
Impairment of financial assets
The Group recognises an allowance for expected
credit losses (“ECLs”) for all debt instruments and
financial guarantee contracts issued. ECLs are based
on the difference between the contractual cash flows
due in accordance with the contract and all the cash
flows that the Group expects to receive, discounted at
an approximation of the original effective interest rate.
The expected cash flows will include cash flows from
the sale of collateral held or other credit enhancements
that are integral to the contractual terms. For financial
guarantee contracts, the ECL is the difference between
expected payments to reimburse the holder of the
guarantee debt instruments less any amounts the
Group expects to recover from the other party.
ECL is measured based on either the general 3-stage
approach or the simplified approach.
The general 3-stage approach is applied for loans
to related parties and financial guarantee contracts
issued.
For credit exposures for which there has not been
a significant increase in credit risk since initial
recognition, ECLs are provided for credit losses that
result from default events that are possible within the
next 12-months (a 12-month ECL). For those credit
exposures for which there has been a significant
increase in credit risk since initial recognition, a loss
30 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
allowance is required for credit losses expected over
the remaining life of the exposure, irrespective of the
timing of the default (a lifetime ECL).
For trade receivables, the Group applies a simplified
approach in calculating ECLs. The Group does not
track changes in credit risk, but instead recognises a
loss allowance based on lifetime ECLs at each reporting
date. The Group has established a provision matrix
that is based on its historical credit loss experience,
adjusted for forward-looking factors specific to the
debtors and the economic environment.
Collective assessment
To measure ECL, trade receivables and other
receivables have been grouped based on shared credit
risk characteristics, such as days past due.
Individual assessment
Trade receivables, other receivables and amounts due
from related parties which are in default or credit-
impaired are assessed individually.
(l) Property, plant and equipment
All property, plant and equipment are initially recorded
at cost. Borrowing costs directly attributable to the
acquisition or construction of qualifying assets are
added to the cost of those assets until the assets are
ready for their intended use. Land is not depreciated.
Depreciation on other items of property, plant and
equipment is calculated on the straight-line method
to write off the cost of each asset to their residual
values using the below rates which is reflective of their
estimated useful life as follows:
Buildings
3% – 6%
Ships
2.5% - 10%
Plant and fittings
6% - 20%
Motor vehicles
10% - 20%
Where the carrying amount of an asset is greater than
its estimated recoverable amount, it is written down
immediately to its recoverable amount. Gains and
losses on disposal of property, plant and equipment are
determined by reference to their carrying amount and
are taken into account in determining operating profit.
Subsequent costs are included in the asset’s carrying
amount or recognised as a separate asset, as
appropriate, only when it is probable that future
economic benefits associated with the item will flow
to the Group and the cost of the item can be measured
reliably. All other repairs and maintenance are charged
to the statements of comprehensive income during the
financial period in which they are incurred.
(m) Investment properties
Investment properties include land held for long-
term capital appreciation and buildings leased out
under operating leases. Properties that comprise a
portion held to earn rentals and a portion for own use
or occupation will only be classified as investment
property if an insignificant portion is held for own use of
occupation. Investment properties are recognised when
it is probable that future economic benefits associated
with the property will flow to the Group and the cost
of the investment property can be reliably measured.
Investment properties are stated at cost less accumulated
depreciation and accumulated impairment losses.
Transaction costs are included on initial measurement.
Borrowing costs directly attributable to the acquisition
or construction of qualifying assets are added to the
cost of those assets until the assets are ready for their
intended use. The fair values of investment properties
are disclosed in the Note 11. These are assessed using
internationally accepted valuation methods, such as
taking comparable properties as a guide to current
market prices or by applying the discounted cash
flow method. Like property, plant and equipment,
investment properties are normally depreciated using
the straight-line method over similar useful lives.
(n) Goodwill
Goodwill represents the excess of the cost of an
acquisition over the fair value of the Group’s share of
the net identifiable assets of the acquired business at
the date of acquisition.
Goodwill is capitalised and assessed for impairment
annually or more frequently if events or changes in
circumstances indicate a potential for impairment
and is carried at cost less impairment losses. Any
impairment is recognised immediately as an expense
and is not subsequently reversed.
Gains and losses on the disposal of an entity include
the carrying amount of goodwill relating to the entity
sold. Goodwill is allocated to cash-generating units for
the purpose of impairment testing.
(o) Trade and other payables
These amounts represent obligations to pay for goods
and services that have been acquired in the ordinary
course of business from suppliers. They are classified
as current liabilities if payment is due within one year
or less. Trade payables are recognised initially at fair
value and subsequently measured at amortised cost
using the effective interest method. The amounts are
unsecured and are usually paid within 30 days of
recognition.
Steamships Annual Report 2024 31
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
(p) Provisions
Provisions are recognised when the Group has a
present legal or constructive obligation as a result of
past events; it is probable that an outflow of resource
embodying economic benefits will be required to settle
the obligation; and a reliable estimate of the amount of
the obligation can be made.
A liability for annual leave is recognised and measured
at the amount of unpaid leave at amounts expected to
be paid to settle the present entitlements. A liability
for long service leave is recognised taking into
consideration expected future wage and salary levels,
experience of employee departures and periods of
service, discounted to present values.
A provision for estimated ship dry docking costs is
only recognised where the Group has a contractual
obligation under a Bare Boat charter agreement from
a third party. Dry docking costs relating to ships not
under third-party long-term charter agreements are
only recognised as incurred and are capitalised to the
extent that the previously assessed economic benefits
associated with the asset are restored.
(q) Employee benefits
(i) Short term obligations
Liabilities for wages and salaries, including non-
monetary benefits and annual leave expected to be
settled within 12 months after the end of the period
in which the employees render the related service are
recognised in respect of employees’ services up to the
end of the reporting period and are measured at the
amounts expected to be paid when the liabilities are
settled. The liability for annual leave is recognised in
the provision for employee benefits. All other short
term employee benefit obligations are presented as
payables.
(ii) Other long-term employee benefit obligations
The liability for long service leave and annual leave
which is not expected to be settled within 12 months
after the end of period in which the employees render
the related service is recognised in the provision for the
employee benefits and measured as the present value
of expected future payments to be made in respect
of services provided by employees up to the end of
the reporting period using the projected unit credit
method. Consideration is given to expected future wage
and salary levels, experience of employee departures
and periods of service. Expected future payments are
discounted using the market yields at the end of the
reporting period on national government bonds with
terms to maturity and currency that match, as closely
as possible, the estimated future cash outflows.
(iii) Termination benefits
Termination benefits, as and where applicable, are
payable when employment is terminated by the Group
before the normal retirement date, or whenever an
employee accepts voluntary redundancy in exchange
for these benefits. The Group recognises termination
benefits at the earlier of the following dates: (a) when
the Group can no longer withdraw the offer of those
benefits; and (b) when the entity recognises costs
for a restructuring that is within the scope of IAS 37
and involves the payment of termination benefits.
In the case of an offer made to encourage voluntary
redundancy, the termination benefits are measured
based on the number of employees expected to accept
the offer. Benefits falling due more than 12 months
after the end of the reporting period are discounted to
their present value.
(r) Borrowings
Borrowings are recognised initially at fair value, net of
any transaction costs incurred, and are subsequently
measured at amortised cost using the effective interest
method. Borrowings are classified as current liabilities
unless, at the end of the reporting period, the group has
a right to defer settlement of the liability for at least 12
months after the reporting period. Covenants that the
group is required to comply with, on or before the end
of the reporting period, are considered in classifying
loan arrangements with covenants as current or
non-current. Covenants that the group is required to
comply with after the reporting period do not affect the
classification at the reporting date.
(s) Impairment of assets
Assets that have an indefinite useful life are not subject
to amortisation and are tested annually for impairment.
Assets that are subject to depreciation or amortisation
are reviewed 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 value exceeds its recoverable amount, which
is determined as the higher of an asset’s fair value less
costs to sell and its value in use. For the purpose of
assessing impairment, assets are grouped at the lowest
levels for which there are separately identifiable cash
flows (cash generating units).
(t) Borrowing costs
Borrowing costs incurred for the construction
of qualifying assets, which are assets that take a
substantial period of time to get ready for their intended
use or sale, are capitalised during the period of time
that is required to complete and prepare the asset for
its intended use or sale. Other borrowing costs are
expensed.
32 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
The capitalisation rate used to determine the amount
of borrowing costs to be capitalised is the weighted
average interest rate applicable to the entity’s
outstanding borrowings during the year, in this case
4.23% (2023 – 4.14%).
(u) Segment reporting
Operating segments are reported in a manner
consistent with the internal reporting provided to the
chief operating decision maker.
The board of Steamships Trading Company Limited
has appointed a strategic steering committee which
assesses the financial performance and position of
the group and makes strategic decisions. The steering
committee is the group’s chief operating decision
maker and consists of the managing director and
finance director.
(v) Earnings per share
Basic earnings per share is calculated by dividing
the profit attributable to equity holders of the Group,
by the weighted average number of ordinary shares
outstanding during the financial year. There are no
potential ordinary shares on issue and hence the
diluted earnings per share is equal to the basic earnings
per share.
(w) Goods and services tax (GST)
Revenues, expenses and assets are recognised net
of the amount of associated GST. Receivables and
payables are stated inclusive of GST. The amount of
GST recoverable from, or payable to, the Taxation
authority is included within other receivables or
payables in the statements of financial position.
(x) Leases
Leases are recognised as a right-of-use asset and a
corresponding liability at the date at which the leased
asset is available for use by the Group. Each lease
payment is allocated between the liability and finance
cost. The finance cost is charged to profit or loss over
the lease period so as to produce a constant periodic
rate of interest on the remaining balance of the liability
for each period. The right-of-use asset is depreciated
over the shorter of the asset’s useful life and the lease
term on a straight-line basis.
Assets and liabilities arising from a lease are initially
measured on a present value basis. Lease liabilities
include the net present value of the following lease
payments:
•
fixed payments (including in-substance fixed
payments), less any lease incentives receivable;
•
variable lease payments that are based on an
index or a rate;
•
amounts expected to be payable by the lessee
under residual value guarantees;
•
the exercise price of a purchase option if the lessee
is reasonably certain to exercise that option, and
•
payments of penalties for terminating the lease, if
the lease term reflects the lessee exercising that
option.
The lease payments are discounted using the interest
rate implicit in the lease, if that rate can be determined,
or the Group’s incremental borrowing rate.
Right-of-use assets are measured at cost comprising the
following:
•
the amount of the initial measurement of lease
liability;
•
any lease payments made at or before the
commencement date, less any lease incentives
received;
•
any initial direct costs, and
•
restoration costs.
Payments associated with short-term leases and leases
of low-value assets are recognised on a straight-line
basis as an expense in profit or loss. Short-term leases
are leases with a lease term of 12 months or less. Low-
value assets comprise IT-equipment and small items of
office furniture.
Extension and termination options are included in a
number of property and equipment leases across the
Group. These terms are used to maximise operational
flexibility in terms of managing contracts. The
majority of extension and termination options held
are exercisable only by the Group and not by the
respective lessor.
In determining the lease term, management considers
all facts and circumstances that create an economic
incentive to exercise an extension option, or not
exercise a termination option. Extension options (or
periods after termination options) are only included
in the lease term if the lease is reasonably certain to
be extended (or not terminated). The assessment is
reviewed if a significant event or a significant change
in circumstances occurs which affects this assessment
and that is within the control of the lessee.
(y) Rounding of amounts
Amounts in the financial statements have been rounded
off to the nearest thousand Kina.
(z) Critical accounting estimates and judgments
Estimates and judgments are continually evaluated and
Steamships Annual Report 2024 33
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
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.
The
Group
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) Estimated impairment of goodwill
The Group tests annually whether goodwill has
suffered any impairment. The recoverable amounts of
cash-generating units have been determined based on
value-in-use calculations. These calculations require
the use of estimates as further detailed in Note 12.
(ii) Estimated impairment of property, plant and
equipment
The Group tests the recoverable amount of property,
plant and equipment when impairment indicators
are identified. Where an indicator of impairment is
identified, the recoverable amount is determined using
the higher of fair value less cost to sell and its value
in use. Fair value is determined using market-based
information, while value in use is determined using a
pre-tax cashflow projections and discount rate. Refer
to Note 10.
(iii) Deferred tax assets relating to carry forward tax
losses
The analysis of the recognition and recoverability of the
deferred tax assets relating to carry forward tax losses is
complex and judgmental and estimating future taxable
income is based on assumptions that are affected by
expected future market or economic conditions. For
management’s judgments in relation to recoverability
of deferred tax assets, refer to Note 5.
(iv) Incremental borrowing rate relating to lease
liabilities
As disclosed in Note 14, management assessed that
the weighted average interest rate on collateralised
borrowings obtained from financial institutions during
2024 and previous years of 4.5% approximates the
incremental borrowing rate at the date of initial adoption
of IFRS 16 and at 31 December 2024. Therefore, this
rate has been used for discounting lease payments
arising from state land leases and property leases. In
making this judgement, management considered the
period of leases (including extension and termination
options), the quality of leased assets compared to assets
used as collateral for relevant borrowings and made an
assessment whether any adjustments to the weighted
average rate on borrowings are needed to reflect
differences in secured assets, lease periods compared
to maturity of borrowings, and other factors affecting
the incremental borrowing rate. Based on assessment
performed, management concluded that the average
weighted interest rate on borrowings of approximately
4.5% p.a. approximates the rate that the Group would
expect to borrow to acquire the right-of-use assets
in relation to land leases and property leases. If the
incremental borrowing rate were 1% higher/(lower),
lease liabilities as of 31 December 2024 would be K4.4
million lower and K8.2 million higher, respectively
(2023: K4.5 million lower and K8.7 million higher).
2. Financial risk management
The Group’s activities expose it to a variety of financial
risks including market risk (including currency, and
interest rate risk), credit risk, liquidity risk and capital
risk. The Group’s overall risk management program
focuses on the unpredictability of financial markets
and seeks to minimise potential adverse effects on the
financial performance of the Group. Risk management
is carried out under policies approved by the Board of
Directors.
(a) Market risk
(i) Foreign exchange risk
The Group engages in international purchase
transactions and is exposed to foreign exchange risk
arising from various currency exposures, primarily
with respect to the Australian dollar. Foreign exchange
risk arises from recognised assets and liabilities.
The Group’s foreign currency purchases do not
represent a significant proportion of the Group’s
costs and as such exposure to foreign currency risk is
minimal. It is not the Group’s policy to hedge foreign
currency risk. As the foreign currency exposure is
minimal no sensitivity analysis is provided.
(ii) Price risk
The Group is not significantly exposed to equity
securities or commodities price risk.
(iii) Cash flow interest rate risk
The Group’s interest rate risk arises from long-term
borrowings. Borrowings issued at variable rates expose
the Group to cash flow interest rate risk. Borrowings
issued at fixed rates expose the Group to fair value
interest rate risk. Long term borrowings are a mix of
fixed and variable rate interest. It is not the Group’s
policy to hedge cash flow and interest rate risk.
At 31 December 2024, if interest rates on PNG Kina-
34 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
denominated borrowings had been 1% higher/lower
with all other variables held constant, post-tax profit
for the year would have been K4.1 million (2023: K5.8
million) lower/higher, mainly as a result of higher/
lower interest expense on floating rate borrowings.
(b) Credit risk
The Group has no significant concentration of credit
risk and it is not the Group’s policy to hedge credit
risk. The Group has policies in place to ensure that
sales of products and services are made to customers
with an appropriate credit history and has policies
that limit the amount of credit exposure to any one
customer. Where credit limits were exceeded during
the reporting period management has made provision
for amounts considered uncollectible.
The Group has the following types of financial assets
that are subject to the expected credit loss model: trade
receivables, other receivables (including intercompany
receivables) and loans to related parties. While cash
and cash equivalents are also subject to the impairment
requirements of IFRS 9, impairment loss is immaterial.
The Group applies the IFRS 9 simplified approach
to measuring expected credit losses, for all financial
assets, other than loans to related parties and other
receivables. To measure the expected credit losses,
trade receivables have been grouped based on shared
credit risk characteristics and the days past due. The
expected loss rates are based on the payment profiles of
sales over a period of 36 months before 31 December
2024 or 31 December 2023 respectively and the
corresponding historical credit losses experienced
within this period. The historical loss rates are adjusted
to reflect current and forward-looking information
on macroeconomic factors affecting the ability of the
customers to settle the receivables. The Group has
analysed GDP and employment rate of PNG to be
the most relevant factors, and accordingly adjusts the
historical loss rates based on expected changes in these
factors. Management concluded that the impairment
provision for trade receivables is not materially affected
by changes in GDP and employment rate.
For loans to related parties and other receivables, the
Group applies a ‘three-stage’ model for impairment
based on changes in credit quality since initial
recognition, as summarised below:
•
A financial instrument that is not credit-impaired
on initial recognition is classified in ‘Stage 1’ and
has its credit risk continuously monitored by the
Group.
•
If a significant increase in credit risk (‘SICR’)
since initial recognition is identified, the financial
instrument is moved to ‘Stage 2’ but is not yet
deemed to be credit impaired.
•
If the financial instrument is credit-impaired, the
financial instrument is then moved to ‘Stage 3’.
•
Financial instrument in Stage 1 has their ECL
measured at an amount equal to the portion of
lifetime expected credit losses that result from
default events possible within the next 12 months.
Loans in Stages 2 or 3 have their ECL measured
based on expected credit losses on a lifetime
basis.
Forward-looking information incorporated in the
model includes GDP Growth (%) of Papua New
Guinea economy.
The Group considers a loan or other receivable to
have experienced a significant increase in credit risk
when one or more of the following quantitative and
qualitative criteria have been met: delay in payment
of over 30 days, early signs of cash flow/liquidity
problems, significant adverse changes in business,
financial and/or economic conditions in which related
party operates, actual or expected forbearance or
restructuring, significant change in collateral value (for
collateralised loans).
The Group defines a financial instrument as in default,
which is fully aligned with the definition of credit-
impaired, when it meets one or more of the following
criteria: delay in payment of over 90 days, significant
financial difficulty of related party (such as long-term
forbearance, insolvency, or probability of bankruptcy).
A loan or other receivable is considered to no longer
be in default (i.e. to have cured) when it no longer
meets any of the default criteria at the reporting date.
The Expected Credit Loss (ECL) is measured on either
a 12-month (12M) or Lifetime basis depending on
whether a significant increase in credit risk has
occurred since initial recognition or whether an asset
is considered to be credit-impaired.
All of the Group’s loans to related parties as at 31
December 2024 and 31 December 2023 are classified
in ‘Stage 1’. Further, management assessed that no
material impairment provision on loans to related
parties is necessary given the following:
•
Loans to related parties are repayable on demand
and the Group expects to be able to recover the
outstanding balance of related loans, if demanded;
•
Loans to related parties have not had significant
increase in credit risk since the loans were first
recognised;
•
There are no historic losses or write offs on these
loans;
Steamships Annual Report 2024 35
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
•
As a result, impairment provision is based on
12-month expected credit losses, which results in
immaterial impairment provision.
Similarly, the Group’s other receivables as at 31
December 2024 and 31 December 2023 are classified
in ‘Stage 1’, as they are either current or overdue up
to 30 days, and the Group has not noted a significant
increase in credit risk.
(c) Liquidity risk
Prudent liquidity risk management implies maintaining
sufficient cash and the availability of funding through
an adequate amount of committed credit facilities. The
Group manages liquidity risk by maintaining sufficient
bank balances to fund its operations and the availability
of funding through committed credit facilities.
Management monitors rolling forecasts of the Group’s
liquidity reserve on the basis of expected cash flows.
Undrawn finance facilities as of 31 December were as
follows:
2024
2023
K’000
K’000
Undrawn Facilities
190,155
189,699
The table below analyses the Group’s financial
liabilities which will be settled on a net basis into
relevant maturity groupings based on the remaining
period at the balance sheet date to the contractual
maturity date. The amounts disclosed in the table
are the contractual undiscounted cash flows.
Less than
Between 1
Between 2
Over 5
Carrying
1 year
& 2 years
& 5 years
years
Total
amount
K’000
K’000
K’000
K’000
K’000
K’000
At 31 December 2024
Borrowings
(86,832)
(355,801)
-
-
(442,633)
(416,410)
Borrowings from minority shareholders
(160)
-
-
-
(160)
(160)
Borrowings from related parties
(2,351)
-
-
-
(2,351)
(2,305)
Trade and other payables
(138,482)
(14,183)
(21,274)
-
(173,939)
(167,896)
Lease liabilities
(4,914)
(4,914)
(11,895)
(107,151)
(128,874)
(55,776)
(232,739)
(374,898)
(33,169)
(107,151)
(747,957)
(642,547)
At 31 December 2023
Borrowings
(46,682)
(85,385)
(325,120)
-
(457,187)
(418,196)
Borrowings from minority shareholders
(160)
-
-
-
(160)
(160)
Borrowings from related parties
(1,899)
-
-
-
(1,899)
(1,862)
Trade and other payables
(108,680)
-
-
-
(108,680)
(108,680)
Lease liabilities
(5,283)
(5,283)
(11,981)
(111,566)
(134,113)
(57,810)
(162,704)
(90,668)
(337,101)
(111,566)
(702,039)
(586,708)
The Group does not hold derivative financial instruments.
36 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
(d) Capital risk management
The Group’s objectives when managing capital are to
safeguard the Group’s ability to continue as a going
concern in order to provide returns to shareholders
and benefits for other stakeholders and to maintain an
optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the
Group may adjust the amount of dividends paid to
shareholders, return capital to shareholders, issue new
shares or sell assets to reduce debt.
The Group monitors capital on the basis of the gearing
ratio. This ratio is calculated as net debt divided by total
capital. Net debt is calculated as external borrowings
and unsecured loans less cash and cash equivalents.
Net debt for the purposes of the gearing ratio does not
include lease liabilities, trade and other payables and
provisions for other liabilities and charges. Total capital
is calculated as capital and reserves attributable to the
Group’s shareholders plus net debt. The gearing ratios
at each balance date were as follows:
2024
2023
K’000
K’000
Total external borrowing
and unsecured loans 418,875
420,218
Less: Cash and Cash
equivalents
27,800
28,804
Net debt
391,075
391,414
Total equity
1,084,923 1,069,6239
Total capital
1,475,998
1,461,037
Gearing ratio
26%
27%
The Group is subject to certain covenants
related primarily to its external borrowings.
Non-compliance with such covenants may
result in negative consequences for the Group
including declaration of default. The Group was
in compliance with covenants as at 31 December
2024 and 31 December 2023, as well as during
respective years.
(e) Fair value estimation
IFRS 7 ”Financial Instruments: Disclosures”
requires disclosure of fair value measurements
by level of the following fair value measurement
hierarchy:
•
Quoted prices (unadjusted) in active markets for
identical assets or liabilities (level 1).
•
Inputs other than quoted prices included within
level 1 that are observable for the asset or liability,
either directly (that is, as prices) or indirectly (that
is, derived from prices) (level 2).
•
Inputs for the asset or liability that are not based
on observable market data (that is, unobservable
inputs) (level 3).
•
If one or more of the significant inputs is not based
on observable market data, the instrument is
included in level 3.
The Group does not hold any financial assets at fair value.
Steamships Annual Report 2024 37
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
3. Operating results
Consolidated
Parent Entity
2024
2023
2024
2023
(a) Revenue and other income comprises:
Revenue from contracts with customers
- Revenue from sale of goods
70,353
67,236
-
-
- Revenue from provision of services
527,209
467,694
-
-
Lease income
119,818
121,360
-
-
Dividend income
-
-
72,767
11,503
Total Revenue
717,380
656,290
72,767
11,503
Other income (net)*
29,643
13,006
2,248
5,098
* Other income includes royalties, gain on sale of assets and net proceeds from insurance claims.
The Group’s revenue from contracts with customers are recognised at a point in time and over time. Most of the revenue from the
provision of services is recognised over time, while revenue from sale of goods is recognised at a point in time. Further disaggregation
of revenue by segment is provided in Note 24.
The aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied (or partially unsatisfied)
as of 31 December 2024 that relates to shipping and freight services which commenced in late 2024 and will be finalised within
January 2025 is K3.3 million (2023: K1.3 million).
Consolidated
Parent Entity
2024
2023
2024
2023
(b) Expenses comprise:
Cost of sales
158,450
132,979
-
-
Staff costs (Note 3c)
198,932
174,530
-
-
Depreciation and amortisation
113,468
104,529
2,009
2,073
Electricity and fuel
52,291
46,889
-
-
Insurance
7,914
10,054
-
-
Security cost
15,011
13,125
-
-
Motor vehicle expenses
33,106
33,861
-
-
Other operating expenses / (income) - net
98,453
74,574
735
(381)
Total operating expenses
677,625
590,541
2,744
1,692
(c) Staff costs:
Wages and salaries
166,988
146,622
-
-
Retirement benefit contributions
6,309
5,776
-
-
Other benefits
25,635
22,132
-
-
Total staff costs
198,932
174,530
-
-
Number of staff employed by the Group at year end:
Full-time
3,365
3,010
-
-
38 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
3. Operating results (continued)
Consolidated
Parent Entity
2024
2023
2024
2023
(d) The operating profit before income tax is arrived at after charging and crediting the following specific items:
After charging:
Audit fees
1,238
1,172
-
-
Fees for non-audit services to Auditors
192
122
-
-
Bad and doubtful debts provided
3,203
7,460
-
-
Donations
2,707
1,792
-
-
After crediting:
Net proceeds from insurance claims
(17,077)
(11,292)
-
-
Gain on sale of property, plant and equipment - net
(12,250)
(1,714)
-
-
Bad and doubtful debts released
(3,365)
(38)
-
-
(e) Cost of financing – net:
Interest expense*
19,722
15,826
-
-
Interest income
(13,604)
(14,174)
(85)
(85)
Net finance costs / (income)
6,118
1,652
(85)
(85)
*The interest expense excludes capitalised interest which is K1.5 million in 2024 (2023: Knil).
(f) Earnings per share
Basic earnings per share are calculated by dividing the net profit attributable to shareholders by the average number of ordinary
shares on issue during the year. There is no difference between the basic and diluted earnings per share.
Consolidated
2024
2023
Net profit attributable to shareholders
45,838
58,144
Average number of ordinary shares on issue (thousands)
31,008
31,008
Basic earnings per share (continuing and discontinued)
147.8 toea
187.5 toea
Basic earnings per share (continuing)
147.8 toea
187.5 toea
4. Investments in subsidiaries, associates and joint ventures
Consolidated
Parent Entity
2024
2023
2024
2023
(a) Investments are accounted for in accordance with the policy set out in Note 1(c) and relate to:
Investments in subsidiary companies (Note 21)
-
-
55,299
55,252
Investments in associates (Note 22)
5,676
5,464
-
-
Investments in joint ventures (Note 23)
45,886
40,031
-
-
51,562
45,495
55,299
55,252
(b) Share of after tax profit in associates and joint ventures
Share of profit in associates
269
121
-
-
Share of profit in joint ventures
5,872
7,165
-
-
6,141
7,286
-
-
Steamships Annual Report 2024 39
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
5. Income tax
Consolidated
Parent Entity
2024
2023
2024
2023
(a) Income tax expense
Current tax
16,742
24,622
-
222
Deferred tax
4,208
420
46
825
Prior period under provision
1,479
680
-
-
22,429
25,722
46
1,047
(b) The income tax in the Statements of Comprehensive Income is determined in accordance with the policy set out in
Note 1(f). The effective rate of tax charged differs from the statutory rate of 30% for the following reasons.
Prima facie tax on profit before income tax
20,826
25,317
21,707
4,498
Non-taxable income - dividends
-
-
(21,661)
(3,451)
Tax on non-deductible expenses
833
677
-
-
Income not assessable for tax
(1,842)
(2,186)
-
-
Adjustments for current and deferred tax of prior periods
1,479
680
-
-
Unrecognised deferred tax asset on tax losses
1,133
1,234
-
-
22,429
25,722
46
1,047
(c) The deferred tax (liabilities) / assets comprise:
Provisions
16,161
14,247
(48)
51
Lease liabilities
16,731
17,341
-
-
Prepayments and consumables
(16,836)
(14,342)
-
-
Property, plant and equipment
(36,391)
(31,427)
834
781
Right-of-use assets
(8,811)
(9,278)
-
-
(29,146)
(23,459)
786
832
Deferred tax assets
4,880
4,627
834
832
Deferred tax liabilities
(34,026)
(28,086)
(48)
-
(29,146)
(23,459)
786
832
40 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
5. Income tax (continued)
Beginning
Charge to
Ending
Balance
profit
Balance
(d) The gross movement on the deferred tax account is as follows:
Consolidated
Provisions and accruals
14,247
1,914
16,161
Lease liabilities
17,341
(610)
16,731
Prepayments and consumables
(14,342)
(2,494)
(16,836)
Property, plant and equipment
(31,427)
(4,964)
(36,391)
Right-of-use assets
(9,278)
467
(8,811)
Total
(23,459)
(5,687)
(29,146)
Parent Entity
Property, plant and equipment
781
53
834
Loan receivable
51
(99)
(48)
Total
832
(46)
786
(e) The movement in income tax (receivable) / payable is as follows:
Consolidated
Parent Entity
2024
2023
2024
2023
At 1 January
(5,163)
(12,088)
35
(38)
Income tax provision
16,742
24,622
-
222
Prior year over provisions
-
-
(13)
(12)
Utilisation of interests withholding tax
(2,106)
(2,115)
-
-
Others
-
913
-
-
Tax payments made
(23,802)
(16,495)
(261)
(137)
(14,329)
(5,163)
(239)
35
6. Cash and cash equivalents
Consolidated
Parent Entity
2024
2023
2024
2023
Cash and short-term deposits
27,800
28,804
-
-
27,800
28,804
-
-
The maximum exposure to credit risk at the reporting date is the fair value of cash and cash equivalents on the statements of
financial position. Cash and short-term deposits are held with the banks resident in Papua New Guinea who have appropriate long
term credit ratings.
Steamships Annual Report 2024 41
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
7. Trade and other receivables
Consolidated
Parent Entity
2024
2023
2024
2023
Trade receivables
110,708
86,390
-
-
Trade receivables - related parties (Note 18)
7,782
37,828
878
45,296
Provision for impairment
(17,223)
(17,385)
-
-
101,267
106,833
878
45,296
Other receivables
41,754
64,201
-
-
Prepayments
16,966
13,692
-
2
159,987
184,726
878
45,298
(i) Credit losses
As at 31 December 2024 and 31 December 2023, loss allowance was determined as follows for trade receivables:
More than 30
More than 60
More than 90
31 December 2024
Current
days past due
days past due
days past due
Total
Expected credit loss rate
0.01% - 3%
3% to 30%
30% - 60%
60% to 70%
15.45%
Gross carrying amount - trade receivables
78,444
16,346
8,102
8,565
111,457
Loss allowance
1,599
4,884
4,815
5,925
17,223
More than 30
More than 60
More than 90
31 December 2023
Current
days past due
days past due
days past due
Total
Expected credit loss rate
0.01%-0.07%
0.07-10%
10-25%
25%-75%
14%
Gross carrying amount - trade receivables
65,102
26,340
9,854
22,922
124,218
Loss allowance
419
2,570
2,342
12,054
17,385
Movement in the provision for impairment of trade receivables is as follows:
Consolidated
Parent Entity
2024
2023
2024
2023
Opening balance
17,385
11,163
-
-
Impairments recognised during the year
3,203
7,460
-
-
Provision released
(3,365)
(38)
-
-
Write off
-
(1,200)
-
-
Total
17,223
17,385
-
-
The creation and release of the provision for impaired receivables is included in operating expenses in the statements of comprehensive
income. Amounts charged to the provision account are generally written off when there is no expectation of recovering the balance
outstanding.
The maximum exposure to credit risk at the reporting date is the fair value of each class of receivable mentioned above. The Group
does not hold any collateral as security in relation to these receivables.
(ii) Other receivables and prepayments
Other receivables generally arise from transactions outside the usual operating activities of the Group. These mostly include
receivables for rental bonds, dividends from a joint venture and other tax receivables (such as GST receivables) and other non-
financial assets. These receivables are not interest bearing. Collateral is not normally obtained.
As at 31 December 2024 and 31 December 2023, most of the Group’s other receivables are current and classified as Stage 1 for
impairment provisioning purposes. The amount of other receivables overdue more than 30 days is not material, and the impairment
provision based on expected loss model is immaterial.
Prepayments relate to advance payments for expenses not yet incurred.
42 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
8. Inventories
Consolidated
Parent Entity
2024
2023
2024
2023
Finished goods
47,381
39,624
-
-
Provision for obsolescence
(308)
(144)
-
-
47,073
39,480
-
-
Inventories recognised as an expense during the year ended 31 December 2024 and included in cost of sales and cost of providing
services amounted to K23.9 million (2023: K23.1 million).
9. Due from / (to) related companies
Consolidated
Parent Entity
2024
2023
2024
2023
Non-Current
Harbourside Development Limited
124,727
203,503
-
-
Pacific Rumana Limited
24,587
25,375
-
-
Wonye No. 2 Limited
3,182
957
-
-
Viva No. 31 Limited
2,748
2,584
-
-
Huhu Rural LLG
846
1,103
-
-
Colgate Palmolive (PNG) Limited
518
536
518
536
Wonye Limited
22
-
-
-
Wakang Inc.
16
16
-
-
John Swire & Sons Limited
-
8,995
-
8,995
Loan from subsidiaries
-
-
2,537
-
156,646
243,069
3,055
9,531
Due to associates and joint ventures:
Current
Stevedoring associates
(2,305)
(1,862)
-
-
Loans from subsidiaries
-
-
(39,894)
(93,982)
(2,305)
(1,862)
(39,894)
(93,982)
The loans to Harbourside Development Limited are secured and earn interest at 6.5% per annum. The loan to Pacific Rumana
Limited is unsecured and earns interest at 8.5% per annum. The loan from stevedoring associates is unsecured and incurs interest
at 2% per annum.
Steamships Annual Report 2024 43
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
10. Property, plant and equipment
Plant and
Right-of-use
Property
Ships
Vehicles
Assets
Total
Consolidated
2024
Cost
666,312
560,421
497,284
43,253
1,767,270
Accumulated depreciation
(including impairment losses)
(330,193)
(260,940)
(305,688)
(38,083)
(934,904)
Net book value
336,119
299,481
191,596
5,170
832,366
Opening value
288,652
227,092
170,545
6,270
692,559
Additions
77,610
109,651
53,846
341
241,448
Disposals
(906)
(53)
(911)
-
(1,870)
Depreciation
(29,237)
(37,209)
(31,884)
(1,441)
(99,771)
Closing value
336,119
299,481
191,596
5,170
832,366
2023
Cost
570,926
406,495
437,174
42,912
1,457,507
Accumulated depreciation
(including impairment losses)
(282,274)
(179,403)
(266,629)
(36,642)
(764,948)
Net book value
288,652
227,092
170,545
6,270
692,559
Opening value
305,522
139,910
104,456
8,667
558,555
Additions
4,590
120,012
94,681
495
219,778
Disposals
(382)
(31)
(1,242)
-
(1,655)
Depreciation
(21,078)
(32,799)
(27,350)
(2,892)
(84,119)
Closing value
288,652
227,092
170,545
6,270
692,559
44 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
10. Property, plant and equipment (continued)
Plant and
Property
Vehicles
Total
Parent Entity
2024
Cost
121,881
7,313
129,194
Accumulated depreciation (including impairment losses)
(62,055)
(6,258)
(68,313)
Net book value
59,826
1,055
60,881
Opening value
21,634
1,362
22,996
Additions
39,894
-
39,894
Depreciation
(1,702)
(307)
(2,009)
Closing value
59,826
1,055
60,881
2023
Cost
81,987
7,313
89,300
Accumulated depreciation (including impairment losses)
(60,353)
(5,952)
(66,305)
Net book value
21,634
1,361
22,995
Opening value
23,379
1,689
25,068
Depreciation
(1,745)
(328)
(2,073)
Closing value
21,634
1,361
22,995
(a) Assets in the course of construction
The carrying amounts of the assets disclosed above include the following expenditure recognised in relation to property, plant and
equipment and investment properties which are in the course of construction:
Consolidated
Parent Entity
2024
2023
2024
2023
Property
9,729
20,654
-
-
Ships and plant and vehicles
32,114
86,138
-
-
Total assets in the course of construction
41,843
106,792
-
-
The cost of additions during the year includes capitalised borrowing costs amounting to K1.5 million (2023: Knil). The Group used
capitalisation rate of 4.23% (2023: 4.14%) per annum to determine the amount of borrowing costs eligible for capitalisation.
Steamships Annual Report 2024 45
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
10. Property, plant and equipment (continued)
(b) Right-of-use assets
The recognised right-of-use assets relate to properties leased by the Group for its use (i.e. leased buildings and motor vehicles).
The movement of right-of-use assets classified under property, plant and equipment is provided below:
2024
2023
PGK’000
PGK’000
Opening net book amount
6,270
8,667
Lease agreements made during the year
341
495
Depreciation
(1,441)
(2,892)
Closing net book amount
5,170
6,270
At cost
43,253
42,912
Accumulated depreciation (including impairment losses)
(38,083)
(36,642)
5,170
6,270
11. Investment properties
Investment properties represent the Group’s residential and commercial properties that are available for external lease rather than
internal use. Properties used by the Group are shown in ‘Property’ within Note 10.
Consolidated
Parent Entity
2024
2023
2024
2023
Cost
633,391
592,008
-
-
Accumulated depreciation
(224,330)
(210,634)
-
-
Net book value
409,061
381,374
-
-
Opening value
381,374
388,896
-
-
Additions
41,383
12,888
-
-
Depreciation
(13,696)
(20,410)
-
-
Closing value
409,061
381,374
-
-
46 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
11. Investment properties (continued)
(a) Right-of-use assets
The recognised right-of-use assets relate state land leases related to properties owned by the Group (including investment
properties). The breakdown of right-of-use assets classified under investment properties is provided below:
2024
2023
Opening net book amount
24,673
25,086
Terminated
(37)
-
Depreciation
(420)
(432)
Others
-
19
Closing net book amount
24,216
24,673
At cost
26,781
26,781
Accumulated depreciation
(2,565)
(2,108)
24,216
24,673
(b) Amounts recognised in profit / (loss) for investment properties
Rental income
119,817
121,360
Repairs and maintenance attributable to rental properties under non-cancellable leases
4,669
(3,485)
Operating expenses directly attributable to rental properties under non-cancellable leases
(26,073)
(24,094)
(c) Valuation basis
Properties include commercial and residential properties occupied by Group businesses together with commercial and residential
investment properties which are available for external lease. An analysis of the carrying amount and estimated range of fair values
for each category of property is shown below. Fair values have been estimated internally, based on market evidence of property
values, supported by independent professional valuations from previous years, adjusted by observable market trends related to PNG
residential and commercial properties, as well as land values, on an annual basis.
Included in properties are the following:
Valuation Range
NBV
Lower
Higher
Investment properties
409,061
1,581,179
1,976,473
Other properties (Note 10)
336,119
442,595
553,244
Total
745,180
2,023,774
2,529,717
The Group has utilised certain historical facts and available relevant market data in reaching their opinion as to the valuation of the
properties up to the date of valuation, including use of comparable sales and capitalisation rates.
(d) Non-current assets pledged as security
Refer to Note 16 for information on non-current assets pledged as security by the Group.
Steamships Annual Report 2024 47
11. Investment properties (continued)
(e) Contractual receivables
Minimum lease receivables under non-cancellable operating leases of investment properties not recognised in the financial statements
are receivable as follows:
Consolidated
Parent Entity
2024
2023
2024
2023
Within one year
96,258
81,104
-
-
Later than one year but not later than five years
206,624
145,261
-
-
Later than five years
13,499
18,700
-
-
316,381
245,065
-
-
12. Intangible assets
Consolidated
Parent Entity
2024
2023
2024
2023
Goodwill
76,433
76,433
-
-
The Group performs impairment tests on an annual basis. For the 2024 and 2023 reporting periods, the recoverable amount of
the cash-generating units (CGUs) was determined based on value-in-use calculations which require the use of assumptions. These
calculations use pre-tax cash flow projections based on financial budgets approved by management covering a three-year period.
Cash flows beyond the three-year period are extrapolated using the estimated growth rates. These growth rates are consistent with
forecasts included in industry reports specific to the industry in which each CGU operates.
Management has determined the values based on the key assumptions as follows:
Long-term growth rate - This is the weighted average growth rate used to extrapolate cash flows beyond the budget period. The
rates are consistent with forecasts included in industry reports.
Pre-tax discount rates - Reflect specific risks relating to the relevant CGUs and the countries in which they operate.
Pacific Towing
The goodwill balance in 2024 is PGK67.4 million (2023: K67.4 million). Growth beyond year three for the purpose of the impairment
testing is set at 7% (2023: 7%). A pre-tax discount rate of 14.8% per annum (2023: 14.9% per annum) has been used and reflects
specific risks relating to the operating CGU. The recoverable amount of the Pacific Towing CGU exceeds its carrying amount
by K25.3 million (2023: K36.1 million). Management believes that growth rate of revenue of 7% per annum for Pacific Towing is
appropriate, as approved three-year financial budgets are based on conservative assumptions.
Management determined the budgeted gross margin based on past performance and its market expectations. If the revised growth
rate beyond three years had been 1% lower than management’s estimates, the Group would need to reduce the carrying value of
goodwill by K0.3 million. The CGU’s carrying amount would exceed the value in use at a growth rate lower than 6.0% per annum.
The discount rates used are pre-tax and reflect specific risks relating to the relevant CGUs. If the revised estimated pre-tax discount
rate applied to the discounted cash flows of the CGU had been 1% higher than management’s estimates, the recoverable amounts
of goodwill would exceed their carrying amounts by K5.6 million. The CGU’s carrying amount would be equal to value in use at a
discount rate of approximately 16.2% per annum.
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
48 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
12. Intangible assets (continued)
New Britain Shipping
The goodwill balance in 2024 is PGK9.0 million (2023: K9.0 million). Growth beyond year three for the purpose of the impairment
testing is set at 5% (2023: 7%). A pre-tax discount rate of 15.0% per annum (2023: 14.9% per annum) has been used and reflects
specific risks relating to the operating CGU. The recoverable amount of the New Britain Shipping CGU exceeds its carrying amount
by K2.0 million (2023: K6.7 million). Management believes that growth rate of revenue of 5% per annum for New Britain Shipping is
appropriate, as approved three-year financial budgets are based on conservative assumptions.
Management determined the budgeted gross margin based on past performance and its market expectations. If the revised growth
rate beyond three years had been 1% lower than management’s estimates, the Group would need to reduce the carrying value of
goodwill by K0.1 million. The CGU’s carrying amount would exceed the value in use at a growth rate lower than 4.1% per annum.
The discount rates used are pre-tax and reflect specific risks relating to the relevant CGUs. If the revised estimated pre-tax discount
rate applied to the discounted cash flows of the CGU had been 1% higher than management’s estimates, the recoverable amounts
of goodwill would exceed their carrying amounts by K0.6 million. The CGU’s carrying amount would be equal to value in use at a
discount rate of approximately 16.4% per annum.
13. Trade and other payables
Consolidated
Parent Entity
2024
2023
2024
2023
Current
Trade payables
45,456
42,741
-
-
Trade payables - related parties (Note 18)
-
8,343
-
-
Accruals
59,853
39,638
-
-
Other payables
33,173
17,958
-
-
138,482
108,680
-
-
Non-current
Other payables
29,414
-
-
-
29,414
-
-
-
All current trade and other payables are due and payable within 12 months and are recorded at their fair value. Non-current other
payables relate to deferred annual payments for the Portside land acquisition discounted at a rate of 4.56% per annum due by
31 July 2030.
Steamships Annual Report 2024 49
14. Lease Liabilities
As disclosed in Note 10 and 11, the right-of-use assets and related lease liabilities are recognised in relation to the following types
of assets: state land leases related to properties owned by the Group (including its investment properties) and properties (i.e.
buildings leased by the Group for its use).
2024
2023
State land leases
25,814
25,868
Properties
29,630
31,942
Vehicles
332
-
Total lease liabilities
55,776
57,810
Total lease liabilities as of 31 December 2024 include current liabilities of K2.3 million (31 December 2023: K2.6 million) and non-
current liabilities of K53.5 million (31 December 2023: K55.2 million).
Minimum lease payments:
Not later than 1 year
4,914
5,283
Later than 1 year and not later than 5 years
16,809
17,264
Later than 5 years
107,151
111,566
Total
128,874
134,113
Less: Unexpired finance charges
(73,098)
(76,303)
55,776
57,810
Present value of lease liabilities:
Not later than 1 year
2,280
2,576
Later than 1 year and not later than 5 years
14,236
14,100
Later than 5 years
39,260
41,134
Total
55,776
57,810
Interest on lease liabilities recognised in profit or loss by the Group amounts to PGK 2.5 million (2023: PGK2.6 million).
Movement in net lease liabilities as per below:
Opening
57,810
59,912
Lease agreements made during the year
341
495
Disposal during the year
(39)
-
Finance costs
2,505
2,593
Repayment
(4,841)
(5,190)
55,776
57,810
The weighted average lessee’s incremental borrowing rate applied to the lease liabilities on 31 December 2023 and 31 December
2024 was 4.5% p.a. Management assessed that weighted average interest rate on borrowings obtained from financial institutions
during 2024 and previous years approximates incremental borrowing rate at the date of initial adoption of IFRS 16 and at 31
December 2024. For related management’s judgments refer to Note 1(z).
The Group recognised expenses relating to short-term leases and expenses relating to leases of low-value assets that are not
short-term leases of K4.2 million and Knil for the year ended 31 December 2024 (2023: K3.5 million and Knil), respectively.
These expenses are included in operating expenses. The Group’s leases have no variable payments.
15. Provisions for other liabilities and charges
Insurance
Employee
Claims
Others
2024
2023
Opening value
16,621
571
122
17,314
16,211
Charged to profit and loss
9,250
130
-
9,380
9,783
Utilisation / Reversal during the year
(7,027)
(571)
-
(7,598)
(8,681)
Closing value
18,844
130
122
19,096
17,313
Current
6,458
130
122
6,710
6,122
Non-current
12,386
-
-
12,386
11,191
18,844
130
122
19,096
17,313
A description of employee provisions is disclosed in Note 1(p).
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
50 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
16. Borrowings
Consolidated
Parent Entity
2024
2023
2024
2023
Current:
Bank overdrafts (secured)
1,564
2,895
-
-
Bank loans
70,000
30,000
-
-
Other loans (unsecured)
160
160
-
-
71,724
33,055
-
-
Non-current:
Bank loans (secured)
344,845
385,301
-
-
344,845
385,301
-
-
Total Borrowings
416,569
418,356
-
-
Mortgages over certain of the Group’s properties and a registered equitable charge over the remainder of the Group’s assets,
undertakings and uncalled capital are held by the Group’s bankers as security for the bank overdrafts and secured loans.
Interest is paid on all loans at commercial rates at a discount to Indicator Lending Rates. The effective interest rate on bank facilities at
the balance sheet date was 4.23% per annum (2023: 4.14% per annum). Bank overdrafts are interest-only with no agreed repayment
schedule. Bank loans are secured loans with varying 1 to 3 year terms. The effective interest rate on other loans is 2.0% per annum
(2023: 2.0% per annum).
The fair value of borrowings approximates their carrying amounts. Borrowing terms, margins and credit risk factors approximate
currently obtainable levels for similar facilities.
17. Share capital
Consolidated
Parent Entity
2024
2023
2024
2023
(a) Issued and paid up capital
Ordinary shares
24,200
24,200
24,200
24,200
(b) Number of shares
Number of shares (000’s)
Ordinary shares
31,008
31,008
31,008
31,008
In accordance with the Papua New Guinea Companies Act 1997 the shares have no par value.
The Company’s securities consist of ordinary shares which have equal participation and voting rights.
(c) Dividends
The Directors advised that a dividend of 30 toea per share will be paid immediately after the Annual General Meeting on 20th
June 2025. Dividends payable to shareholders resident outside of Papua New Guinea will be converted to Australian Dollars at
the prevailing rate which the Company is able to secure. During the year the Company paid dividends totalling 100 toea per share
which relate to the final dividend of 2023 at 60t per share amounting to K18.60 million, and interim dividend for 2024 financial year
of K12.41 million at 40t per share.
Steamships Annual Report 2024 51
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
18. Related party disclosures
(a) Loss of control:
On 22nd October 2024, the Board of Gulf Maritime Services Limited (GMS) approved the issue of subscription shares to
Steamships Trading Company Limited, GFS Limited and Gulf Provincial Government (GPG). GPG received their shares for Knil
consideration. GMS is now accounted for as a joint venture company.
On 21st September 2023, the Board of Wonye No. 2 Limited has approved the issuance of 3.5 million ordinary shares each
to Steamships Trading Company Limited and Tininga Limited respectively. As a result of the subscription, Steamships Trading
Company Limited no longer has effective control. Wonye No 2 Limited is now accounted for as a joint venture company.
(b) Interest in subsidiaries, associates and joint ventures:
These are set out in Notes 21, 22 and 23 respectively.
(c) Remuneration:
Income received or due and receivable both by Directors and general managers in connection with the management of the
Group companies is shown in the Directors’ Report.
Consolidated
Parent Entity
2024
2023
2024
2023
Key management personnel disclosure
Wages and salaries
20,441
18,744
-
-
Other short-term benefits
3,770
2,760
-
-
(d) Material transactions:
Sales of goods and services
- Associates and joint ventures
6,991
4,636
-
-
- Key management
13
1,751
-
-
- Associated groups
295
7,074
-
-
Lease and rental income
- Associated groups
1,614
473
-
-
- Key management
1,033
-
-
-
Dividend received
- Associates and joint ventures
8,058
10,654
-
-
- Shareholders
-
-
80,561
-
Management fee received
- Associates and joint ventures
1,240
1,229
-
-
- Associated groups
-
-
-
-
- Other shareholders
-
-
-
-
Interest received
- Associates and joint ventures
12,920
13,926
-
-
Royalties received
- Associates and joint ventures
1,885
2,154
1,885
2,154
Shipping and towage services
- Key management
1,199
-
-
-
- Associated groups
42,277
50,308
-
-
Cartage and storage services
- Associates and joint ventures
121
-
-
-
- Key management
288
-
-
-
- Associated groups
7,718
3,797
-
-
Purchase of goods and services
- Associates and joint ventures
(2,481)
(248)
-
-
- Associated groups
(54,267)
(4,383)
-
-
- Key management
(2,199)
(7)
-
-
Management fees and recharges
- Associated groups
(11,221)
(10,244)
-
-
52 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
18. Related party disclosures (continued)
Consolidated
Parent Entity
2024
2023
2024
2023
Dividends paid
- Other shareholders (minority interest)
(683)
(554)
-
-
- Controlling shareholder
(22,363)
(23,481)
(22,363)
(23,481)
- Significant shareholder
(8,646)
(9,078)
(8,646)
(9,078)
Loans to/(from) related companies
- Associates and joint ventures
(79,821)
41,183
-
-
All transactions with related parties are made on normal commercial terms and conditions.
Balances with related companies:
Associates and joint ventures:
Stevedoring associates (Note 9)
(2,305)
(1,862)
-
-
Basiloc Limited (Note 16)
(160)
(160)
-
-
Due from related Companies:
Harbourside Development Limited (Note 9)
124,727
203,503
-
-
Pacific Rumana Limited (Note 9)
24,587
25,375
-
-
Wonye No. 2 Limited
3,182
957
-
-
Viva No. 31 Limited (Note 9)
2,748
2,584
-
-
Huhu Rural LLG (Note 9)
846
1,103
-
-
Colgate Palmolive (PNG) Limited (Note 9)
518
536
518
536
Wonye Limited (Note 9)
22
-
-
-
Wakang Inc. (Note 9)
16
16
-
-
Subsidiary companies (Note 9)
-
-
2,537
-
John Swire & Sons Limited (Note 9)
-
8,995
-
8,995
Total trade receivables from related companies (Note 9)
156,646
243,069
3,055
9,531
Balances receivable / (payable) from / to related companies:
Harbourside Development Limited (Note 7)
4,010
-
-
-
John Swire & Sons Limited (Note 7)
2,932
36,228
404
36,228
Colgate Palmolive (PNG) Limited (Note 7)
474
1,068
474
9,068
Makerio Stevedoring Limited (Note 7)
171
131
-
-
Nikana Stevedoring Limited (Note 7)
128
401
-
-
Wonye Limited (Note 7)
67
-
-
-
Total trade receivables from related companies (Note 7)
7,782
37,828
878
45,296
Payables
John Swire & Sons Limited (Note 13)
-
(8,343)
-
-
Total trade payables from related companies (Note 13)
-
(8,343)
-
-
Steamships Annual Report 2024 53
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
19. Reconciliation of cash flows
Consolidated
Parent Entity
2024
2023
2024
2023
(a) Cash generated from operations
Profit from continuing operations after tax
46,992
58,667
72,310
13,947
Depreciation and impairment
113,468
104,529
2,009
2,073
Dividend and interest income
(444)
(11,775)
(72,767)
(11,503)
Net gain on sale of fixed assets
(12,250)
(1,714)
-
-
Share of profit of associates and joint ventures
(6,141)
(7,286)
-
-
Change in operating assets and liabilities
Decrease/ (Increase) in trade debtors and other receivables
32,893
(37,106)
-
(1,388)
Increase in inventory
(7,593)
(11,018)
-
-
(Increase) / Decrease in deferred tax assets
(253)
(2,607)
(2)
825
(Decrease) / Increase in trade creditors and other payables
(1,901)
642
20
-
(Decrease) / Increase in other operating liabilities
(4,965)
596
(7)
(1,677)
(Increase) / Decrease in income tax receivable
(9,167)
6,925
(274)
72
Increase in deferred tax liabilities
5,940
3,706
48
-
Net cash from operating activities
156,579
103,559
1,337
2,349
(b) Net debt reconciliation
Lease
Bank
Other
liabilities
loans
loans
Total
Net debt as at 1 January 2023
(59,912)
(259,500)
(3,062)
(322,474)
Proceeds from borrowings
-
(185,000)
-
(185,000)
Repayments
-
30,000
1,040
31,040
Lease agreements made during the year
(495)
-
-
(495)
Finance costs
(2,593)
(801)
-
(3,394)
Payment of lease liabilities
5,190
-
-
5,190
Net debt as at 31 December 2023
(57,810)
(415,301)
(2,022)
(475,133)
Proceeds from borrowings
(120,000)
-
(120,000)
Repayments
120,000
-
120,000
Lease agreements made during the year
(341)
-
-
(341)
Disposals during the year
39
-
-
39
Finance costs
(2,505)
456
(123)
(2,172)
Payment of lease liabilities
4,841
-
-
4,841
Net debt as at 31 December 2024
(55,776)
(414,845)
(2,145)
(472,766)
20. Retirement benefit plans
The total cost of retirement benefits of the Group in 2024 was K6.3 million (2023: K5.7 million). The Group participates in the
National Superannuation Fund of Papua New Guinea, a multi-employer defined contribution fund, on behalf of all citizen employees
with minimum employer and employee contribution rates established by legislation.
The parent entity does not employ staff directly; consequently, there was no charge during the year.
54 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
21. Subsidiaries and transactions with non-controlling interests
Significant investments in subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with
the accounting policy described in Note 1(c):
Equity Holdings(1) Equity Holdings(1)
Name of Entity
Country of Incorporation
Class of Shares
2024
2023
Steamships Limited
Papua New Guinea
Ordinary
100
100
Croesus Limited
Papua New Guinea
Ordinary
100
100
Oro Port Services Limited
Papua New Guinea
Ordinary
100
100
Kiunga Stevedoring Company Limited
Papua New Guinea
Ordinary
100
100
Windward Apartments Limited
Papua New Guinea
Ordinary
100
100
Pacific Towing SI Limited
Solomon Islands
Ordinary
100
100
Kavieng Port Services Limited
Papua New Guinea
Ordinary
60
60
New Britain Shipping Limited(2)
Papua New Guinea
Ordinary
50
50
United Stevedoring Limited(3)
Papua New Guinea
Ordinary
70
70
Morobe Terminals Limited(4)
Papua New Guinea
Ordinary
50.5
50.5
Lae Port Services Limited(5)
Papua New Guinea
Ordinary
51.5
51.5
Port Services PNG Limited(5)
Papua New Guinea
Ordinary
54
54
Madang Port Services Limited
Papua New Guinea
Ordinary
60
60
Motukea United Limited
Papua New Guinea
Ordinary
64.1
64.1
Palm Stevedoring & Transport Limited
Papua New Guinea
Ordinary
66.7
66.7
Sandaun Agency & Stevedoring Limited(6)
Papua New Guinea
Ordinary
100
100
Gazelle Port Services Limited(7)
Papua New Guinea
Ordinary
100
100
Portside Business Park Limited(8)
Papua New Guinea
Ordinary
100
100
Wonye No. 2 Limited(9)
Papua New Guinea
Ordinary
50
50
Gulf Maritime Services Limited(10)
Papua New Guinea
Ordinary
47.5
100
Hebamo Transport Limited(11)
Papua New Guinea
Ordinary
100
100
(1) The portion of ownership is equal to the proportion of voting power held.
(2) Consolidated by virtue of control over the operating decisions and returns. As at 31 December 2024, Steamships Trading
Company Limited still has control over this entity.
(3) United Stevedoring Limited became a subsidiary in May 2019.
(4) Morobe Terminals Limited became a subsidiary in May 2019 and is in liquidation.
(5) Lae Port Services and Port Services PNG Limited are in liquidation.
(6) Incorporated since 9 March 2012 and is 100% owned by Steamships Limited. This Company is operating as an agency of
Consort. JV Port Services assumed the control of the management in 2022 with its 3-year Stevedoring license validity.
(7) Incorporated on 21 July 2021 and is domiciled in Rabaul. The company is still under start-up phase.
(8) Previously known as Motukea Industrial Park Limited, this company was incorporated on 30 April 2020 and is still under start-up
phase.
(9) Incorporated on 8 October 2021 and is still under start-up phase. Wonye No. 2 became a joint venture company on 21
September 2023.
(10) Incorporated on 9 May 2023 and is still non-operating. Gulf Maritime Services Limited became an associate on 22 October 2024.
(11) Incorporated on 5 February 2024 and is still non-operating.
Shares in subsidiary companies have been stated at cost or fair value on acquisition less dividends received from pre-acquisition
profits.
Steamships Annual Report 2024 55
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
21. Subsidiaries and transactions with non-controlling interests (continued)
The summarised financial information of the Group’s largest subsidiaries with non-controlling interest as at 31 December 2024 and 31
December 2023 is as follows:
Ownership
Assets
Liabilities
Carrying
Revenue
Profit
2024
Interest %
Value
Madang Port Services Limited
60
6,942
590
6,352
7,071
1,158
New Britain Shipping Limited
50
19,856
2,572
17,284
9,934
(663)
Motukea United Limited
64.1
4,404
1,180
3,224
12,781
1,852
Kavieng Port Services Limited
60
3,897
482
3,415
5,030
215
United Stevedoring Limited
70
4,582
3,094
1,488
19,677
432
2023
Madang Port Services Limited
60
6,352
824
5,528
5,712
658
New Britain Shipping Limited
50
21,338
2,979
18,359
10,387
(283)
Motukea United Limited
64.1
2,767
1,064
1,703
8,916
261
Kavieng Port Services Limited
60
3,818
555
3,263
4,765
142
United Stevedoring Limited
70
2,451
1,343
1,108
16,487
107
22. Investment in associates
(a) Movement in carrying amounts as below:
Consolidated
Parent Entity
2024
2023
2024
2023
Opening value
5,464
5,593
-
-
Share of profits before tax
384
173
-
-
Income tax expense
(115)
(52)
-
-
Dividends received
(57)
(155)
-
-
Adjustments
-
(95)
-
-
Closing value
5,676
5,464
-
-
The equity method is used to account for all interests in associates on a consolidated basis.
(b) Summarised financial information of equity accounted associates.
The Group’s share of the results of its principal associates and its aggregated assets (including goodwill) and liabilities are as follows:
Ownership
Assets
Liabilities
Carrying
Revenue
Profit
2024
Interest %
Value
Makerio Stevedoring Limited
45
2,653
1,265
1,388
2,286
64
Nikana Stevedoring Limited
45
3,519
1,688
1,831
2,831
205
Riback Stevedoring Limited
49
2,501
44
2,457
-
-
8,673
2,997
5,676
5,117
269
Ownership
Assets
Liabilities
Carrying
Revenue
Profit
2023
Interest %
Value
/(loss)
Makerio Stevedoring Limited
45
2,008
654
1,354
1,938
19
Nikana Stevedoring Limited
45
3,277
1,624
1,653
2,201
102
Riback Stevedoring Limited
49
2,501
44
2,457
-
-
7,786
2,322
5,464
4,139
121
The associates provide stevedoring services to various external and Group shipping entities.
All associated companies are incorporated and operate in Papua New Guinea.
There are no contingent liabilities relating to the Group’s interest in the associates.
56 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
23. Investment in joint ventures
(a) Movement in carrying amounts
2024
2023
Opening value
40,031
39,865
Additions during the year
48
3,500
Share of profits before tax
8,389
10,370
Income tax expense
(2,517)
(3,111)
Dividends received
-
(10,499)
Adjustments
(65)
(94)
Closing value
45,886
40,031
The interest in joint ventures is accounted for in the financial statements using the equity method of accounting.
(b) Information relating to the joint ventures is set out below.
Ownership
Assets
Liabilities
Carrying
Revenue
Profit
Interest
Value
/Loss
2024
%
Colgate Palmolive (PNG) Limited
51
42,808
25,817
16,991
51,512
3,399
Harbourside Development Limited
50
502,876
486,396
-
22,219
-
Pacific Rumana Limited
50
7,367
2,006
5,361
2,765
768
Viva No. 31 Limited
50
9,770
6,563
3,207
843
69
Wonye Limited
50
49,877
33,354
16,523
3,643
1,487
Wonye No. 2 Limited
50
12,465
8,613
3,852
484
149
Gulf Maritime Services Limited
47.5
-
48
(48)
-
-
625,163
562,797
45,886
81,466
5,872
Ownership
Assets
Liabilities
Carrying
Revenue
Profit
Interest
Value
2023
%
Colgate Palmolive (PNG) Limited
50
33,528
19,893
13,635
51,512
5,758
Harbourside Development Limited
50
496,315
457,656
-
14,152
-
Pacific Rumana Limited
50
4,714
121
4,593
2,561
595
Viva No. 31 Limited
50
9,924
6,729
3,195
843
(135)
Wonye Limited
50
50,840
35,841
14,999
3,358
838
Wonye No. 2 Limited
50
8,410
4,801
3,609
236
109
603,731
525,041
40,031
72,662
7,165
The Group’s share of the capital commitments of joint ventures at 31 December 2024 is K4.5 million (2023: K10.2 million).
There are no contingent liabilities arising from the Group’s interests in the joint ventures.
Steamships Annual Report 2024 57
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
24. Segmental reporting
(a) Description of segments
The Board monitors the business from a product perspective and has identified three reportable segments. A brief description of
each segment is outlined below:
•
Property and hospitality – consist of the hotels owned and operated by the Group and also its property leasing division. The
assets are stated at historical cost net of accumulated depreciation and include new assets in the course of construction.
•
Logistics – consists of shipping and land-based freight transport and related services divisions.
•
Commercial and investments – consists of commercial, head office administration function and insurance activities.
(b) Segment information
The segment information provided to the Board for the reportable segments for the year ended 31 December 2024 is as follows:
Property
Logistics
Commercial and
Total
and
Investments
Hospitality
(and eliminations)
2024
Total revenue and other income from continuing operations
311,512
433,001
2,510
747,023
Interest revenue
-
138
13,466
13,604
Interest expense
(2,505)
-
(17,217)
(19,722)
Segment results
123,282
(6,728)
(53,274)
63,280
Share of joint ventures and associates profit
-
-
6,141
6,141
Income tax (expense) / credit
(36,985)
2,018
12,538
(22,429)
Profit / (Loss) from continuing operations
86,297
(4,710)
(34,595)
46,992
Segment assets
781,400
577,367
421,825
1,780,592
Segment liabilities
(104,140)
(382,718)
(208,811)
(695,669)
Net assets
677,260
194,649
213,014
1,084,923
Total assets include investments in joint ventures and associates
25,642
5,723
20,197
51,562
Capital expenditure
108,390
94,854
27,878
231,122
Depreciation
(44,061)
(66,152)
(3,255)
(113,468)
Cost of goods and services
(60,208)
(104,966)
6,724
(158,450)
Staff costs
(39,407)
(129,891)
(29,634)
(198,932)
Significant items:
Net insurance proceeds
16,622
-
455
17,077
Gain on asset disposal – net
11,849
454
(53)
12,250
ERP costs
-
-
(9,416)
(9,416)
58 Steamships Annual Report 2024
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
24. Segmental reporting (continued)
(b) Segment information (continued)
Property
Logistics
Commercial and
Total
and
Investments
Hospitality
(and eliminations)
2023
Total revenue and other income from continuing operations
295,273
382,525
(8,502)
669,296
Interest revenue
-
111
14,063
14,174
Interest expense
(2,593)
-
(13,233)
(15,826)
Segment results
104,142
6,066
(33,105)
77,103
Share of joint ventures and associates profit
-
-
7,286
7,286
Income tax (expense) / credit
(31,243)
(1,820)
7,341
(25,722)
Profit / (Loss) from continuing operations
72,899
4,246
(18,478)
58,667
Segment assets
679,348
550,572
471,810
1,701,730
Segment liabilities
(68,787)
(332,162)
(231,158)
(632,107)
Net assets
610,561
218,410
240,652
1,069,623
Total assets include investments in joint ventures and associates
23,200
5,464
16,831
45,495
Capital expenditure
51,953
168,071
2,745
222,769
Depreciation
43,545
57,533
3,451
104,529
Cost of goods and services
(47,418)
(84,390)
(1,171)
(132,979)
Staff costs
(35,471)
(116,261)
(22,798)
(174,530)
Significant items:
Net insurance proceeds
12,426
-
-
12,426
Gain on asset disposal – net
87
1,605
-
1,692
These figures include non-controlling interests share of operating profits and assets.
Revenue from the hotels and property business primarily relates to the provision of services and is recognised over time. A minor
portion represents revenue from the sale of goods and is recognised at a point in time. Similarly, revenue from the logistics business
primarily relates to the provision of services and is recognised over time. Revenue from the commercial segment relates to sale of
goods and is recognised at a point in time.
(c) Geography
The Group operates almost wholly in Papua New Guinea. It is not practical to provide a segment analysis by geographical region
within Papua New Guinea. The Group has two insignificant business operations in the Solomon Islands and Fiji.
Steamships Annual Report 2024 59
NOTES TO THE FINANCIAL STATEMENTS
Steamships Trading Company Limited Year Ended 31 December 2024 (Amounts in Kina 000’s unless otherwise stated)
25. Contingent liabilities
There were contingent liabilities at the Balance Sheet date as follows:
(a)
Steamships Trading Company Limited holds a 51% interest in an associated company, Colgate Palmolive (PNG) Ltd, (“CP (PNG
Ltd”). In 2022 CP (PNG) Ltd received a notice from PNG Customs seeking to reassess the historic rate of import duty applied
to a specific product, known as soap noodles, resulting in an additional duty of K11.1 million and an intention to apply the
higher rate on future imports. CP (PNG) Ltd has disputed the interpretation of the product characteristics by PNG Customs
and formally appealed against this higher assessed rate of duty. The appeal process remains in progress.
To the extent that any of the additional duty is deemed payable by CP (PNG) Ltd following the appeal process, the Group’s
share of profits from associates and the equity accounted investment in CP (PNG) Ltd will be reduced by 51 % of the amount
payable, net of any tax effect.
(b)
The parent entity has given a secured guarantee in respect of the bank overdrafts and loans of certain subsidiaries, associates
and joint ventures.
The parent entity has given letters of comfort of continuing financial support in respect of certain subsidiaries, associates and
joint ventures.
26. Commitments
(a) Capital commitments
Consolidated
Parent Entity
2024
2023
2024
2023
Contracts outstanding for capital expenditure:
- less than 12 months
32,273
19,223
-
-
- 1-5 years
-
-
-
-
32,273
19,223
-
-
27. Subsequent events
On 28th February 2025, Hebamo Transport Limited was structured as a 51%-49% partnership, with Laba Holdings Ltd owning
the majority stake. Hebamo Transport Limited became operational and is well positioned to play a key role in the downstream
construction phase of the Papua LNG Project.
60 Steamships Annual Report 2024
INDEPENDENT AUDITOR’S REPORT
to the Shareholders of Steamships Trading Company Limited
Report on the audit of the financial statements of the Company and the Group
Our opinion
We have audited the financial statements of Steamships Trading Company Limited (the Company), which comprise the
statements of financial position as at 31 December 2024, and the statements of comprehensive income, statements of changes
in equity and statements of cash flows for the year then ended, and the notes to the financial statements, including material
accounting policy information. The Group comprises the Company and the entities it controlled at 31 December 2024 or from
time to time during the financial year.
In our opinion, the accompanying financial statements:
•
comply with IFRS Accounting Standards as issued by the International Accounting Standards Board (IASB) and other
generally accepted accounting practice in Papua New Guinea; and
•
give a true and fair view of the financial position of the Company and the Group as at 31 December 2024, and their
financial performance and cash flows for the year then ended.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those
standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
We are independent of the Company in accordance with the International Ethics Standards Board for Accountants’
Code of Ethics for Professional Accountants (IESBA Code) that are relevant to audits of the financial statements of public
interest entities in Papua New Guinea, and we have fulfilled our other ethical responsibilities in accordance with these
requirements.
Our firm carries out other services for the Group in the areas of taxation and other non-audit services. The provision of these
other services has not impaired our independence as auditor of the Company and the Group.
Our audit approach
An audit is designed to provide reasonable assurance about whether the financial statements are free from material
misstatement. Misstatements may arise due to fraud or error. They are considered material if individually or in aggregate, they
could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.
We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the financial
statements as a whole, taking into account the management structure of the Company and the Group, their accounting
processes and controls and the industries in which they operate.
PricewaterhouseCoopers, PwC Haus, Level 6, Harbour City, Konedobu, PO Box 484
Port Moresby, Papua New Guinea
T: +675 321 1500 / +675 305 3100, www.pwc.com/pg
Steamships Annual Report 2024 61
INDEPENDENT AUDITOR’S REPORT
to the Shareholders of Steamships Trading Company Limited
Materiality
Audit scope
Key audit matters
•
For the purpose of our audit of
the Group we used overall group
materiality of approximately 5%
of the Group’s average profit
before tax for the current and two
previous years.
•
We applied this threshold,
together with qualitative
considerations, to determine
the scope of our audit and the
nature, timing and extent of our
audit procedures and to evaluate
the effect of misstatements on the
financial statements as a whole.
•
We chose Group profit before
tax because, in our view, it is
the metric against which the
performance of the Group is
most commonly measured. We
applied a three year average to
address potential volatility in the
calculation of materiality that
arises from operating in these
industries in Papua New Guinea.
•
We selected 5% based on our
professional judgement noting
that it is also within the range of
commonly acceptable related
thresholds.
•
We (PwC Papua New Guinea)
conducted audit work over the
Group’s significant operations
including the significant
subsidiaries included in the
Group consolidation sufficient
to express an opinion on the
financial statements as a whole.
•
All subsidiaries of the Group at
the year-end are incorporated
and operating in Papua New
Guinea with the exception
of one subsidiary which has
operations in the Solomon
Islands.
•
All significant associates of the
Group are incorporated and
operating in Papua New Guinea
and audited by PwC Papua New
Guinea.
•
Our audit focused on where
the directors made subjective
judgements; for example,
significant accounting estimates
involving assumptions and
inherently uncertain future
events.
•
Amongst other relevant topics,
we communicated the
following key audit matter to
the Audit and Risk Committee:
• Goodwill impairment
assessment
•
This matter is further described
in the Key audit matter section
of our report.
62 Steamships Annual Report 2024
INDEPENDENT AUDITOR’S REPORT
to the Shareholders of Steamships Trading Company Limited
Key audit matter
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial
statements for the current period. The key audit matters were addressed in the context of our audit of the financial statements
as a whole and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have
determined the matters described below to be key matters to be communicated in our report.
Further, commentary on the outcomes of the particular audit procedures is made in that context.
Key audit matter
How our audit addressed the key matter
Goodwill impairment assessment
(Refer to note 12 of the financial statements)
The Group has goodwill totalling K76.4 million at 31
December 2024. In accordance with the accounting
policy in note 1(n) of the financial statements,
the Group has assessed the goodwill balance for
impairment at 31 December 2024.
The Group has calculated the value of the respective
cash generating units which the goodwill relates to
based on financial models comprising cash flow
projections. The cash flow projections use a number of
forward looking assumptions, including revenue and
cost growth, and the value calculation is sensitive to
these.
We considered this a key audit matter because of the
significant judgements around future revenues and
costs, and the discount rate to be applied in determining
the recoverable amount of the cash generating units.
We have considered and tested the financial models
used by the Group to determine the values of the
cash generating units. We compared the models with
the previous year’s models and found them to be
consistently structured and consistent with the basis of
preparation required by accounting standards. Together
with our valuation expert we reviewed the financial
models methodology used in determining the value of
the respective cash generating units.
We compared the forecast revenues and expenditures in
the financial models to approved budgets and obtained
an understanding of the Group’s budgeting procedures
upon which forecasts are based. We also evaluated the
reliability of estimates made by comparing forecasts
made in prior years to actual outcomes.
We benchmarked certain assumptions with external
forecasts, and the discount rates with our expectation
based on the overall Weighted Average Cost of
Capital (WACC) of the Group. Together with our
valuation expert we reviewed the methodology used in
determining the discount rate applied in the financial
models.
We performed sensitivity analysis on assumptions to
ascertain the extent of change that would be required in
key assumptions for the respective goodwill balances to
be impaired. We determined that the calculations were
more sensitive to long-term growth rate assumptions
and discount rates and focused our testing on these
assumptions.
Steamships Annual Report 2024 63
INDEPENDENT AUDITOR’S REPORT
to the Shareholders of Steamships Trading Company Limited
Information other than the financial statements and auditor’s report
The directors are responsible for the annual report which includes other information. Our opinion on the financial statements
does not cover the other information included in the annual report and we do not express any form of assurance conclusion
on the other information.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in
the audit, or otherwise appears to be materially misstated. If, based on the work we have performed on the other information
that we obtained prior to the date of this auditor’s report, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the financial statements
The directors are responsible, on behalf of the company for the preparation of financial statements that give a true and fair
view in accordance with IFRS Accounting Standards as issued by the IASB and other generally accepted accounting practice
in Papua New Guinea and the Companies Act 1997 and for such internal control as the directors determine is necessary to
enable the preparation of financial statements that give a true and fair view and are free from material misstatement, whether
due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the ability of the Group to continue as a going
concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless
the directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements, as a whole, are free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with the ISAs
will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered
material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users
taken on the basis of the financial statements.
As part of an audit in accordance with International Standards on Auditing, we exercise professional judgement and maintain
professional scepticism throughout the audit. We also:
•
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and
perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide
a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one
resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of
internal control.
•
Obtain an understanding of internal control relevant to the audit 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 Group’s internal control.
•
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related
disclosures made by the directors.
64 Steamships Annual Report 2024
INDEPENDENT AUDITOR’S REPORT
to the Shareholders of Steamships Trading Company Limited
Auditor’s responsibilities for the audit of the financial statements (continued)
•
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit
evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt
on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required
to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our
auditor’s report. However future events or conditions may cause the Group to cease to continue as a going concern.
•
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether
the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
•
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities
within the Group to express an opinion on the financial statements. We are responsible for the direction, supervision and
performance of the Group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the
audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements
regarding independence and communicate with them all relationships and other matters that may reasonably be thought to
bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance
in the audit of the financial statements for the current period and are therefore the key audit matters. We describe these matters
in our auditor’s report unless law or regulations preclude public disclosure about the matter or when, in extremely rare
circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of
doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on other legal and regulatory requirements
The Companies Act 1997 requires that in carrying out our audit we consider and report on the following matters. We confirm
in relation to our audit of the financial statements for the year ended 31 December 2024:
•
We have obtained all the information and explanations that we have required;
•
In our opinion, proper accounting records have been kept by the Company as far as appears from an examination of those
records.
Steamships Annual Report 2024 65
INDEPENDENT AUDITOR’S REPORT
to the Shareholders of Steamships Trading Company Limited
Who we report to
This report is made solely to the Company’s shareholders, as a body, in accordance with the Companies Act 1997. Our audit
work has been undertaken so that we might state to the Company’s shareholders those matters which we are required to state
to them in an auditor’s report and for no other purpose. We do not accept or assume responsibility to anyone other than the
Company and the Company’s shareholders, as a body, for our audit work, for this report or for the opinions we have formed.
PricewaterhouseCoopers
Chris Wickenhauser
Peter Buchholz
Partner
Partner
Registered under the Accountants Act 1996
Registered under the Accountants Act 1996
Port Moresby
31 March 2025
66 Steamships Annual Report 2024
DIRECTORS’ REPORT
Steamships Trading Company Limited Year ended 31 December 2024
Steamships Trading Company Limited and Subsidiary Companies
The Directors submit their Annual Report for the year ended 31 December 2024 for the Company and its subsidiaries.
Principal Activities and Review of Operations
Full details of the Group’s activities are given in the Directors’ Review on page 8. The Group continues to operate in the
segments of Property and Hospitality, Logistics and Commercial and Investments.
The Directors believe that there will be no significant changes in the Group’s activities for the foreseeable future.
Changes in Accounting Policies
There are no changes in accounting policies during the year.
Results
The Group operating profit for the year attributable to shareholders was K45,838,000 (2023: K58,144,000).
Dividends
The Directors advise that a final dividend of 30 toea per share will be paid after the Annual General Meeting on 20th June
2025. Dividends payable to shareholders resident outside of Papua New Guinea will be converted to Australian Dollars at the
prevailing rate which the Company is able to secure.
Rounding Off
Amounts in the Directors’ Report and accounts have been rounded off to the nearest thousand Kina.
Steamships Annual Report 2024 67
DIRECTORS’ REPORT
Steamships Trading Company Limited Year ended 31 December 2024
Experience & Interests Register
Directors serving at the date of this report have disclosed the following experience and interests in shares in the Company and
provided general disclosure of companies in which the Director is to be regarded as interested as set out below:
G.L. Cundle
Chairman since 2015
Managing Director from 2013 to 2015
Member of the Remuneration and Nomination Committee
Member of the Strategic Planning Committee Director since 2013
Mr. Cundle joined the Swire Group in 1979 and has extensive corporate experience having worked with the Group in various
divisions in Hong Kong, Australia, Korea, Japan, and Papua New Guinea. He was a Non-Executive Director of Steamships
in 2006-2007 and General Manager of Steamships Shipping & Transport from 1989-1992. He was the Managing Director of
Steamships Trading Company Limited from 1st January 2013 to 12th January 2015. He is the Chairman and Chief Executive
Officer of John Swire and Sons (Australia) Pty Limited.
P. J. Aitsi MBE
Director from November 2014 to 2018
Member of the Strategic Planning Committee since 1st January 2025
Director since 2021
Peter Aitsi is a senior Papua New Guinean business leader with over 30 years of experience having led and managed a
number of PNG’s leading companies. He has a long-standing involvement with community organisations such as
Transparency International PNG, Badili Club of PNG, and Kokoda Track Foundation. Peter serves on the board of
the following companies; Steamships Trading Company, Chair of MiBank PNG, Chair of PNG Property Developers
Association, Director of OilMin Holdings and Chair of media company PNGFM Ltd. He studied Banking and Finance
at the PNG Institute of Banking and Finance in Port Moresby (now IBBM), he is a member of the Australian Institute of
Directors and a member of the PNG Institute of Directors (PNGID) and was awarded the Male Director of the Year in 2018.
In 2004 he was accorded a Queens award as a Member of the British Empire (MBE) in recognition for his contributions
to the development of PNG media and his long-standing voluntary service to various community organisations.
L.M. Bromley
Chairperson of the Audit and Risk Committee since July 2021
Member of the Strategic Planning Committee since July 2021
Member of the Remuneration and Nomination Committee since July 2021
Director since 2019
Ms. Bromley has been a Senior Executive at the Bromley Group of Companies for over 12 years. She currently serves as
a Director for various commercial operating companies within the group, including Heli Niugini Ltd, Maps Tuna Ltd, and
Western Drilling Ltd in Papua New Guinea; PT Sayap Garuda Indah and PT Air Bali in Indonesia; Merit Finance Limited,
Allway Logistics Limited, and Merit Logistic Services Limited in Hong Kong; and Aerolift (Singapore) Pte. Ltd. in Singapore. In
these roles, she oversees aviation operations, logistic support, and group investment functions.
Additionally, Ms. Bromley is the Director of Bromley Investment Fund Pte. Ltd. and Bromley Investment Office Pte. Ltd.,
which manage the investment portfolio of the Bromley Group. She also provides consultancy services for the group’s property
development and property management companies in Papua New Guinea and Australia.
Ms. Bromley is a Director of Viva No 31 Ltd, a joint venture company with Steamships Trading Company, and has previously
held positions on the Divisional Boards of EastWest Transport and Steamships Shipping. She holds a Bachelor of Commerce
and a Bachelor of Laws.
68 Steamships Annual Report 2024
DIRECTORS’ REPORT
Steamships Trading Company Limited Year ended 31 December 2024
D.H. Cox OL, OBE
Managing Director from 2004 to 2012
Member of the Audit and Risk Committee
Member of the Strategic Planning Committee
Director since 2003
Mr. Cox joined Steamships as a Manager in 1992, rising to become Managing Director from 2004-2012. He has extensive
experience in the Asia-Pacific business environment and holds an MBA in International Hospitality & BSc (Hons) in Accounting
& Business Management.
C.K. Daniells
Appointed as Managing Director on 1st July 2024
Member of the Strategic Planning Committee since 1st July 2024
Member of the Remuneration and Nomination Committee since 1st July 2024
Appointed as Steamships Limited’s Managing Director on 1st July 2024, Mr. Daniells was previously the Managing Director
of Swire Projects and Chief Commercial Officer for Singapore-based Swire Shipping and has over 25 years’ experience in the
shipping industry. His extensive career began in 1997 when he joined John Swire & Sons Ltd. His experience spans various
sales, trade management, and senior executive roles across Australia, Papua New Guinea, Hong Kong, Europe, and Singapore.
This is not his first time in PNG and with Steamships, as early in his career, he was engaged as the National Marketing
Manager, PNG. Following 2-years in Port Moresby, he gained valuable experience with Cathay Pacific in Hong Kong and Italy
as Head of Planning and Country Manager before returning to Singapore as General Manager at Swire Shipping, overseeing
the operational and strategic leadership of the business implementing a USD450 million new building programme and the
successful delivery of twelve new multi-purpose vessels into the Swire Shipping network. In 2016, he was appointed as a
Commercial Director, where he developed a new commercial strategy and grew the newly established Swire Bulk division into
one of the top three market leaders in this sector, establishing the business from a start-up to USD1.5 billion turnover business
operating 150 vessels. In 2020, he was appointed Chief Commercial Officer establishing Swire Projects, and created a new
independent Trans-Pacific trade service operating between Vietnam and the West Coast, North America.
C. Kasou
Appointed as Non-Executive Director on 1st March 2024
Member of the Remuneration and Nomination Committee since 1st January 2025
Christine began her career in private practice in 2001 as a commercial lawyer with Gadens Lawyers (now Dentons) in
Port Moresby. In 2006, Christine joined Oil Search (PNG) Limited, now a subsidiary of Santos Limited. She has over 17
years of experience in Papua New Guinea’s oil and gas industry working extensively in the organization’s contracting and
procurement functions, legal and compliance department, gas projects development and people and culture function.
Christine has substantial experience in corporate governance and regulatory responsibilities within the jurisdiction and is
currently the Senior Commercial Manager, PNG. Christine holds a Bachelor of Laws from the University of Papua New Guinea.
A. Mistroni
Appointed as Finance Director and Company Secretary on 1st July 2024
Alessandro was named Finance Director of Steamships 1 July 2024. He began his career in the UK with Smiths Group Plc;
he has over 20 years’ experience in financial leadership roles across Europe, Middle East and Asia in both private and public
listed companies.
In his previous roles he was responsible for business turnaround, digital transformation, financial planning, liquidity
management. He holds a bachelor’s degree from University of East London, and he is a Fellow of Chartered Institute of
Management Accountants of England and Wales as well as CPA Australia.
Steamships Annual Report 2024 69
J.B. Rae-Smith
Director since 2019
Mr. Rae-Smith is Chairman of Swire Energy Services, Swire Renewable Energy and United States Cold Storage, a Director and
Chairman of the Audit and Risk Committee of Swire Shipping Co Pte Ltd and Swire Bulk Pte Ltd. He is also the President of the
United Kingdom Chamber of Shipping. He joined the Swire Group in 1985 and has worked with the Group in Australia, Papua
New Guinea, Japan, Taiwan region, Hong Kong, the United States, Singapore, and the United Kingdom. He was a Director of
Swire Pacific Limited, a company listed in Hong Kong, from January 2013 to August 2016 and was the Executive Director of
the Marine Services Division from 2005 to 2016, the Trading & Industrial Division between 2008 and 2016 and Chairman of
the Swire Group Charitable Trust. In addition, he has also been a Director of the Standard P&I Club, Deputy Chairman of the
Hong Kong Ship Owners Association, Chairman of the Lloyds Asian Ship Owners Committee, and a Director of the Singapore
Environmental Council.
R.P.N. Bray
Managing Director from 20th September 2020 to 1 July 2024
Member of the Strategic Planning Committee until 1 July 2024
Member of the Remuneration and Nomination Committee until 1 July 2024
Director from 2018 until 1 July 2024
Appointed Managing Director in 2020, Mr. Bray was Chief Operating Officer from 2018 until his appointment as Managing
Director. Mr. Bray was previously Marine Services Director of Singapore based Swire Pacific Offshore Pte Ltd. There, he was
responsible for Swire Pacific Offshore’s subsea, renewables, logistics, seismic, salvage and oil spill divisions. He was formally
Chief Operating Officer of Swire Oilfield Services and held various senior operational and commercial positions in Cathay
Pacific Airways Ltd in his earlier career. He held directorship of various Steamships Trading Company subsidiaries, joint
ventures, and associated companies. He sat on a number of charitable advisory boards and PNG business groupings, including
chairing anti-gender-based violence charity, Bel isi, The Salvation Army PNG, acting as the deputy chair industry body, PNG
Property Developers Association, the United Nations Biodiversity & Climate Fund for PNG, and the Business Council’s Energy
Working Group. He graduated with a Bachelor of Science from Bristol University (UK) and holds a Master of Marine Sciences
from Nanyang Technical University (Singapore). He is a graduate of the Australian Institute of Company Directors and holds
several IOSH Health & Safety qualifications.
M.R. Scantlebury
Managing Director from September 2018 to September 2020
Finance Director & Company Secretary from June 2016 to September 2018 and from September 2020 until 30 June 2024
Mr. Scantlebury is a chartered accountant and was previously Director of the Office for Financial Planning at Swire Pacific
Ltd in Hong Kong and he has held various senior finance and commercial positions in the Swire group in his career. He held
Directorship of various Steamships Trading Company subsidiaries, joint ventures, and associated companies.
DIRECTORS’ REPORT
Steamships Trading Company Limited Year ended 31 December 2024
70 Steamships Annual Report 2024
STOCK EXCHANGE INFORMATION
Steamships Trading Company Limited Year ended 31 December 2024
Remuneration of Directors
Directors remuneration received or receivable from the Company as directors during the year, is as follows:
2024
2023
K’000
K’000
GL Cundle (Chairman)
268
249
LM Bromley
313
280
DH Cox
271
252
PJ Aitsi
151
140
JB Rae-Smith
151
205
C Kasou
122
-
Lady WT Kamit
-
95
1,276
1,221
The directors fees vary in accordance with the required duties on various sub-committees of the board.
* Executive Directors receive no fees for their service as Directors during the year.
Remuneration of Employees
The number of employees whose remuneration and other benefits was within the specified bands are as follows:
Remuneration
2024
2023
Remuneration
2024
2023
Remuneration
2024
2023
K’000
No.
No.
K’000
No.
No.
K’000
No.
No.
For and on behalf of the Board:
Port Moresby
G.L. Cundle
C.K. Daniells
31 March 2025
Chairman
Managing Director
100-110
10
18
110-120
10
8
120-130
14
9
130-140
8
7
140-150
12
11
150-160
6
7
160-170
6
5
170-180
8
5
180-190
2
4
190-200
2
3
200-210
5
5
210-220
3
2
220-230
4
1
230-240
9
3
240-250
5
3
250-270
6
12
270-280
1
3
280-290
5
4
290-300
2
3
300-320
4
4
310-340
-
4
340-360
2
3
360-370
1
1
370-380
-
3
380-390
1
3
390-400
3
-
400-500
11
15
500-600
5
5
600-700
10
13
710-800
6
7
810-900
5
4
910-1,000
-
2
1,000-1,500
4
1
1,500-2,000
1
3
2,000-2,900
1
1
2,900-3,000
1
1
Steamships Annual Report 2024 71
STOCK EXCHANGE INFORMATION
Steamships Trading Company Limited Year ended 31 December 2024
Shares are listed on the Australian Securities Exchange and the Port Moresby Stock Exchange.
All shares carry equal voting rights.
Shareholdings
At 28 February 2025, there were 374 shareholders.
281
Holding
1
-
1,000 units
62
Holding
1,001
-
5,000 units
15
Holding
5,001
-
10,000 units
12
Holding
10,001
-
100,000 units
4
Holding
100,000 -
over
The number of shareholders holding less than a marketable parcel was 33.
The 20 largest shareholders were:
Number of shares
%
JS&S (PNG) LIMITED
22,362,651
72.12
BERNE NO 132 NOMINEES PTY LTD <722124 A/C>
5,760,000
18.58
NATIONAL SUPERANNUATION FUND LIMITED
1,859,446
6.00
BERNE NO 132 NOMINEES PTY LTD <657243 A/C>
446,494
1.44
JOHN E GILL OPERATIONS PTY LIMITED
54,727
0.18
BUDLEAF PTY LTD
33,836
0.11
HYLEC INVESTMENTS PTY LIMITED
32,500
0.10
BOND STREET CUSTODIANS LIMITED
23,067
0.07
MR RAMESH MAHTANI
21,700
0.07
BNP PARIBAS NOMINEES PTY LTD
20,137
0.06
CITICORP NOMINEES PTY LIMITED
18,606
0.06
PRAFUL PATEL INVESTMENTS PTY LTD PRAFUL & ANITA PATEL S/ A/C
17,264
0.06
INTERCONTINENTAL ASSETS PTY LIMITED
15,000
0.05
MR JAMES DOUGLAS GRIFFITH
11,044
0.04
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
10,767
0.03
MRS LUCY ANN KING
10,348
0.03
MS JENNIFER MAY FORBES
10,000
0.03
BNP PARIBAS NOMINEES PTY LTD
9,568
0.03
CUSTODIAL SERVICES LIMITED
8,768
0.03
MRS JUDITH SCOTTHOLLAND
8,161
0.03
MRS MARY PATRICIA HAUGHTON
8,161
0.03
30,742,245
99.15
Applicable Legislation
The Company is incorporated in Papua New Guinea and is not generally subject to Australian Corporations Law including,
in particular, Chapter 6 of the Australian Corporations Law dealing with the acquisition of shares (including substantial
shareholdings and takeovers). The Company is subject to the requirements of the Papua New Guinea Companies Act 1997,
Securities Act 1997 and the Takeovers Code. The Companies Act and the Securities Act regulate the issue and buy-back of
shares and contain provisions as to the trading in securities, provisions as to financial benefits to related parties, substantial
shareholders provisions, remedies in cases of oppression or injustice and actions by, and access to, records by shareholders.
The Takeovers Code regulates offers where a person already holds more than 20% of the voting rights in a company or where
a person becomes the holder of more than 20% of the voting rights in a manner permitted by the Code.
A code offer, which can either be a full offer or a partial offer, must be extended to all holders of voting securities in the
Company. The Code also contains compulsory purchase and sale provisions if more than 90% of the shares are acquired
under an offer.
72 Steamships Annual Report 2024
This page has been left blank intentionally
CHAIRMAN
G. L. Cundle §¤
MANAGING DIRECTOR
C.K. Daniells
FINANCE DIRECTOR
A. Mistroni
NON-EXECUTIVE DIRECTORS
P. J. Aitsi MBE ¤
L.M. Bromley *§¤
D. Cox OL, OBE *¤
J.B. Rae-Smith ¤
C. Kasou §
* Member of the Audit and Risk Committee
§ Member of the Remuneration and Nomination Committee
¤ Member of the Strategic Planning Committee
SECRETARY
A. Mistroni
REGISTERED OFFICE
Level 2, @345, Stanley Esplanade,
Section 20, Allotments 3, 4 and 5
Granville, Port Moresby, National Capital District
Papua New Guinea
Telephone: +675 313 7400 / 79987000
P.O. Box 1
Port Moresby, National Capital District, 121
Papua New Guinea
AUDITORS
PricewaterhouseCoopers
P.O. Box 484
Port Moresby, NCD
Papua New Guinea
SHARE REGISTRARS
Computershare Investor Services Pty Limited
GPO Box 2975
Melbourne VIC 3001
AUSTRALIA
Telephone: (Aus) 1300 85 05 05
(Overseas) +61 (0)3 9415 4000
Fax:
+61 3 9473 2500
STOCK EXCHANGE
Shares are listed on both the PNGX Markets Limited
and the Australian Securities Exchange Limited
A. R. B. N.
055 836 952
Steamships Annual Report
COMPANY DIRECTORY
Level 2, @345, Stanley Esplanade, Section 20, Allotments 3, 4 and 5
Granville, Port Moresby, National Capital District, Papua New Guinea
P.O. Box 1, Port Moresby, National Capital District, 121, Papua New Guinea
P: +675 313 7400 / 79987000
steamships.com.pg