Year to Date
Nambawan Super Limited’s (NSL) performance in the first half of this year has been generally positive. Despite a slight decrease in interest income from State Securities and lower dividend income due to the additional profits tax on investee company BSP Financial Group, net property income has improved due to increased occupancy rates and better recoveries. In addition, Nambawan Super has seen strong unrealized capital gains from BSP and Credit Corp PNG shares. Similarly, the offshore portfolio has performed well this year, supported by a strong interest in technology stocks, in which Nambawan Super holds investments in. Foreign exchange gains, largely driven by the Bank of PNG’s currency devaluation program, have positively affected Nambawan Super’s performance due to its significant offshore holdings, while foreign exchange constraints locally continue to impact the Fund's onshore investments and its ability to quickly react to international market opportunities. As of this publication, headwinds are emerging as investors fear an economic slump in the U.S, which NSL is closely monitoring.
Nambawan Super acknowledges the positive performance so far, especially considering the challenging start to 2024 when the country experienced what is now known as the 'Black Wednesday' riots. The impact of this unfortunate event continues to exacerbate existing social and economic challenges affecting ordinary citizens, such as; unemployment, inflation, high living costs, Health, and security. Among the organizations affected was a major Nambawan Super investee company, CPL Group, which suffered significant damage and losses amounting to millions of Kina. Even though this event occurred at the beginning of the year, it will certainly affect Nambawan Super's final year results and returns to Members. The destruction and loss of business will lead to lower revenue, increased costs, and will also extend to other businesses and individuals in the value chain network. There is no doubt that affected businesses have had to pass on the costs of losses and recovery to the end consumer.
Overall, the Fund's financial performance is sound and performing better than the same period last year. These half-year results, however, do not include the revaluation of the Fund’s property and private equity investments. This valuation is expected to be concluded in the final quarter of the year, at which point the final Financial Performance results for 2024 will be finalised. The Fund's total expenses are within budget, reflecting prudent management of operational costs.
Investment Highlights – Moki Business Park Launched
On Tuesday, 2 July 2024, Nambawan Super announced the opening of Moki Business Park, which is conveniently located in Waigani’s Business and Government district.
The opening of this investment property symbolizes more than just a new commercial building; it represents another successful PNG-owned investment. The completion of this project demonstrates Papua New Guinean ingenuity, investment capability, and commitment to delivering international standard projects locally, with the aim of furthering the country’s economic growth by injecting investment capital into the economy and creating jobs that keep Papua New Guineans employed and able to provide for their families.
With strong leasing uptake in the property, we expect to generate significant revenue that will benefit the Fund’s 228,319 Members through stronger returns over the long term. This investment aligns with Nambawan Super’s commitment to serve, protect, and grow Members’ savings, while contributing to and strengthening the country’s economic development.
9-Mile, Bushwara Property
Nambawan Super is mandated to protect and serve the interests of its Members. This fiduciary duty requires NSL to safeguard its assets and uphold its legal rights, even when it involves difficult decisions such as evictions. Obtaining the Vacant Possession of NSL’s 9-Mile Lands has been one of two long outstanding matters that has been determined to resolve.
During the first half of 2024, the Fund focused on meeting all legal requirements in order to secure Vacant Possession of its Land Portions, 2156, 2157, 2158, and 2159. The Fund also ensured illegal squatters were kept well informed of the progress of these matters, and their outcome.
The 9-Mile, Bushwara Eviction Exercise, which began on Tuesday, 9 July 2024, was the country’s largest recorded eviction exercise. As a testament to the thorough and careful planning, as well as the cooperation and commitment of all parties involved, the exercise was conducted peacefully with no major incidents reported.
Nambawan Super would like to acknowledge and extend its sincerest appreciation to all stakeholders, especially the Royal Papua New Guinea Police Constabulary (RPNGC), the Sheriff's Office, Government Ministries and Departments, and the general public, whose support and cooperation were instrumental in ensuring the smooth and peaceful execution of this eviction exercise.
9-Mile, Next Steps and Plans
Nambawan Super’s intention for the site remains consistent with those from our early thoughts, and that is to develop new mixed-suburbs, with housing, industrial, and commercial allotments, and deliver infrastructure improvements that come with it, creating thousands of jobs and injecting much-needed capital into the economy.
Outline Master Plan
Previously, NSL developed a preliminary ‘Outline Master Plan’ for the four Land Portions. To develop the ‘Final Master Plan’, full access to the entire site is needed so as to conduct various checks and tests.
With Vacant Possession now secured, Nambawan Super is actively working to fence the land and secure the property. Following this crucial step, the next tasks such as soil testing and hydrology analysis will be carried out to inform and develop the ‘Final Master Plan’.
NSL’s development plans are designed to align with the National Capital District Commission’s (NCDC) urban development goals for Port Moresby, to ensure a well-organised city expansion plan.
Development projects, particularly those of significant scale, require careful planning, collaboration and time. The process involves multiple steps and the coordination of various stakeholders, meaning that progress doesn’t happen overnight and it’s important to understand that each phase is critical to achieving the best possible outcome.
Return on Investment
Nambawan Super’s primary goal is to generate strong returns for NSL Members through calculated and careful investment decisions. The final development plan will be made with all 228,319 Members best interests at heart, ensuring strong long-term returns that will benefit all our Members nationwide, not just those based in Port Moresby.
Outstanding Matter: China Railway Construction Engineering (PNG) Limited (CRCE)
Nambawan Super has also been pursuing another long drawn out dispute in Court regarding the construction of the OPH Precinct in downtown Port Moresby. This matter involves China Railway Construction Engineering (PNG) Limited (CRCE) and an up to K120 million claim which has yet to be determined by the Courts.
As a Trustee, NSL’s first and foremost responsibility and obligation is to the Members and their Fund, and have therefore every intention of protecting and growing Members’ assets for their collective benefit.
2024 Outlook
As we look ahead, there is potential for economic growth and employment in the mining and resource sector. However, Nambawan Super will remain cautiously optimistic and vigilant due to the volatility of both the local and global environments in which we operate.
Our primary goal is to protect and grow our Members' retirement savings. We will do this while also supporting PNG’s economy, by seeking investment opportunities within the country. This is exemplified by our successful delivery of Rangeview Precinct, Moki Business Park, and the ongoing development of our 9-Mile Lands.
Throughout these efforts, we remain focused on improving our service levels and enhancing our Members' experience across all touchpoints of the organisation nationwide.
