Port of Tauranga chief executive Mark Cairns will retire in June next year.
He will be succeeded by the listed company’s chief operating officer Leonard Sampson.
Cairns, 58, will step aside after more than 15 years heading New Zealand’s largest port, during which time its market capitalisation increased more than seven times, by $4.4 billion, to $5.1b today.
Chairman David Pilkington said under Cairns’ leadership, the port company had grown from a regional bulk export port to New Zealand’s international cargo hub and one of its most successful listed companies.
During his time in the job the average compounding total shareholder return had been 19 per cent per year.
When Cairns became chief executive in 2005, the port handled 12.6 million tonnes of cargo and 438,214 containers a year.
In the year to June this year, those tallies had swelled to 24.8m tonnes of cargo and 1.25m containers.
Cairns said the next stage of his career would be in governance.
Craigs Investment Partners head of private wealth research Mark Lister said he was confident Cairns would be in demand as a director.
“Mark has done a great job, and under his command Port of Tauranga has grown significantly, been an industry leader across the board, and delivered excellent returns to shareholders.
“He will be missed, and as is the case whenever a strong CEO chooses to hang up their boots, the focus will be on the company to see if it can continue to deliver in his absence.
“It will certainly be the end of an era, but Mark is still fairly young and enthusiastic, as well as being very capable, so I’m sure he will have no shortage of offers on the governance front,” Lister said.
Jarden managing director, head of research Arie Dekker said Cairns oversaw a period in which investors had seen material capital appreciation.
“The strategy and execution under Mark’s leadership has seen Port of Tauranga materially outpace its competitors.
“Highlights include strategic investments into MetroPort and Timaru and the Kotahi deal – these have helped underpin Tauranga as New Zealand’s leading port.”
Chief executive-designate Sampson was appointed chief operating officer a year ago after six years as the port’s commercial manager. Previously he was general manager sales at KiwiRail.
Pilkington said the company’s success had delivered wide-ranging benefits to the Bay of Plenty region. Local ratepayers own just over half of Port of Tauranga’s shares through regional council entity Quayside Holdings.
A highlight of Cairns’ time as chief executive is considered to be the port’s ambitious play to become the only New Zealand port able to accommodate the world’s biggest cargo ships. This was via a six-year, $350m capital expansion programme intended to cement its future as the country’s premier freight gateway and hub and feeder port.
In an interview with the Herald in 2018, Cairns recalled the analysis had been gruelling and the commercial risk high.
“For a company of our size with a $2.5 billion market cap at the time, to embark on a $350 million capital expansion programme was a big commercial risk.
“We had to back ourselves to attract that cargo. It was a lot of money and the board put a lot of commercial tension around it.”
In late 2016, following dredging to deepen and widen the port’s shipping channels, major landside operational change to handle the anticipated big increase in cargo, and the securing of long term customer contracts to drive container volumes, the first of the big ships tied up at Tauranga – the only port able to accommodate them on international services.
The strategy paid off. In the 2019 financial year the port company cracked $100 million profit for the first time.
Napier-born Cairns, who has a civil engineering degree with first class honours and master of management and business studies degrees, was previously chief executive at Toll Owens and at Owens Cargo.
“The time feels right to hand over to the next generation to continue the Port of Tauranga’s success into the future,” he said.
“Port of Tauranga is in excellent shape. I’m incredibly proud of our people and the positive outcomes we have achieved for our customers and our community.”