Port of Milford Haven 20 Annual Report & Financial Statements 18 Port of Milford Haven Annual Report & Financial Statements 2018

“We are, first and foremost, a port. 2018 Summary In 2018 we celebrated 60 years of expert, dedicated operations helping Trading results for 2018: the nation transport goods quickly Turnover £22.1m and efficiently. Our future will be Operating profit £0.9m built upon these firm foundations as Post-tax loss £(1.0)m we expand into new ventures that 31m tonnes cargo volume Our operational focus is to deliver realise the full potential of our assets, solutions in: Over 2,000 commercial vessels called strengthen our relationships and at the Port Transportation Energy, Renewables and Engineering create new opportunities.” 0 Lost Time Incidents Port Marine Safety Code retained Retail, Leisure and Tourism Investors in People retained Fishing, Fish Processing and Aquaculture Chris Martin, Chair Celebrating our 60th anniversary A new Wellbeing Team champions positive mental and physical health 460,000 sq ft mixed use development, Milford Waterfront, gained resolution to grant outline planning consent

11% increase in ferry freight 13% increase in solar outputs 2.5% sickness absence - now lower than the national average

Contents 2018 Summary 1 Strategic Report Welcome from the Chair 2 Our Vision, Strategy and Values 5 Chief Executive’s Q&A 6 Our People 9 Our Business 10 Principal Risks and Uncertainties 12 Our Operational Divisions 14 Stakeholder Engagement 19 Our Environment 22 Safety & Security 25 Corporate Governance 26 Meet the Board and Senior Management Team 28 Report of the Board 31 Directors’ Responsibilities Statement 35 Independent Auditor’s Report 36 Financial Statements 38 60 years of port operations 66

1 Port of Milford Haven Annual Report & Financial Statements 2018

Welcome from our Chair, Chris Martin

As Chair of the Port, I have great pleasure Marine, as they open up new opportunities to report on our 60th year of operation. in leisure, tourism and renewables. Our It has been a challenging trading year. Cargo focus is on creating the right conditions and volume has fallen to 31m tonnes with lower facilities to attract new businesses to the than expected Liquefied Natural Gas traffic region. As important as both projects are and, while the last few months have seen a to our future, they both have strong links welcome upturn, the performance reinforces to our past. In Milford Waterfront, we are our strategic drive to diversify and expand taking time to embed the rich history of the into new ventures. Last year’s acquisition of town into the development and help Havens Head Retail Park had a negative reinforce Milford Haven’s sense of place. impact on profitability this year but this was With Pembroke Dock Marine we are STRATEGIC REPORT STRATEGIC as a result of an unrealised property continuing the Royal Dockyard’s long revaluation associated with the downturn of tradition of evolving to meet the demands the UK retail sector. We remain confident of industrial growth. This growth is a that the acquisition is an important part of fundamental part of our role as a Trust Port. our long-term growth strategy. Our ongoing The Department for Transport’s “Ports investment into decarbonising our Good Governance Guidance” published in operations has also proved beneficial, both 2018 describes a Trust Port as a valuable financially and environmentally. Looking to asset presently safeguarded by the existing the wider markets, especially for UK trading board whose duty it is to hand it on in the businesses, there is considerable uncertainty same or better condition to succeeding and low national growth forecasts are generations. This remains the ultimate impacting confidence. We recognise the effect responsibility of the Board, and future this will have on us and our customers. We generations remain the ultimate remain committed to our growth strategy stakeholder. It accords with our vision to although we appreciate that a measured build the Haven’s prosperity so it is vital approach must be taken in order to sustain that we ensure the right strategy is in place the business in the long term. and that it is being delivered. In an anniversary year, it is particularly GOVERNANCE CORPORATE important to take stock. Just looking at “The Port of Milford Haven is a Trust Port. progress since our last major milestone in 2008, the Port has seen the construction of We invest to maintain safe navigation on the Europe’s largest and most advanced gas-fired Milford Haven Waterway, to stimulate power station and the arrival of Liquefied Natural Gas which, together, attracted economic growth and help deliver a bright £2.25bn of investment to the Waterway. ” With the new £100m+ investment in outlook for the region. Valero’s combined heat and power co- generating unit, their recent purchase of SEM We are, first and foremost, a port. In 2018 Logistics - now Valero Pembrokeshire Oil we celebrated 60 years of expert, dedicated Terminal, combined with our own focus on operations helping the nation transport creating facilities that are attractive to the goods quickly and efficiently. Our future will emergent marine energy industries, the be built upon these firm foundations as we Milford Haven Waterway remains a powerful FINANCIAL STATEMENTS expand into new ventures that realise the energy hub. As the next decade beckons, we full potential of our assets, strengthen our are not standing still and will invest to deliver relationships and create new opportunities. long-term stable growth. We are excited about our flagship projects, On behalf of the Board and the business, I’d Milford Waterfront and Pembroke Dock like to thank Alec Don who stepped down Chris Martin, Chair 2 3 Port ofMilford Haven &FinancialStatements2018 Annual Report 4 Chris Martin,Chair progress would beimpossible. collective our them, business. Without the to devote all they energy and time the for them thank I The and Board stakeholders. our on having is this impact collaborating positive the and now Port the outside are we much how possible.see as efficientlyalso as I operate we ensuring on intent team, great a see I employees. our all to go words final My and Steve Phillips. Williams Debra Shipperley, Ian Directors Non-Executive new welcomed also We breadth of experience the he brings to the from role. benefit all will WeVice-Chair. to appointment his on Edwards Andrew congratulate and 2018, January in Board to DavenportDavidand the left who Snelson like also I’d years. acknowledge the contributions of both Sue 60 next the in herald will that changes operational some introducing in key be will determination of Interim Chief Executive and his and mantle energy the on taken has Jones Andy wish him the very best in his new ventures. a driving force over the last decade and we year.Executivethis Chief as been has Alec Our Vision, Strategy and Values Our Strategy to a bright, buoyant and prosperous future for the people and businesses of Pembrokeshire. plan, we’ll continue to evolve, deliver value for everyone who depends on us and contribute By keeping our eyes fixed on this exciting vision and our minds focused on our strategy and our communities are stronger. is that careers, rewarding to culturally rich,access has where we community have a the positive where contribution on place our natural a environment creating and where about healthyeconomy,a this.about do just to not able Prosperityis be is to it position instead unique a in are Pembrokeshire,we to Haven’sprosperity. rooted a Trust Port,firmly As MilfordHaven,of Port the At the keybuilding playwe’rerolea in to vision our by fuelled Our Vision: To buildtheHaven’s prosperity 34 12 and intothefuture. now security us give to customers existing with working and retaining our improve earnings while continuing will to focus on that business We’re identifying and developing new apn eas w rcgie we can’t doitalone. recognise plan we because this happen make to organisations income streams long-term, sustainable Targeting securing and er wrig ih other with working We’re partnerships Building strong Safety, Excellence Collaborationand Port ofMilford Haven &FinancialStatements2018 Annual Report Our core values: things thatwe the own. from opportunities economic We’recreatingand after newlooking equipment is ourbusiness. understand their needs. Their business our customers. of To all do that to we need to fully possible service best property, and land our maintaining and Managing We’re aiming to provide the provide to We’re aiming our customers Understanding 5

FINANCIAL STATEMENTS CORPORATE GOVERNANCE STRATEGIC REPORT Port of Milford Haven Annual Report & Financial Statements 2018 Port of Milford Haven Annual Report & Financial Statements 2018

Chief Executive’s Q&A

“It’s been a busy year at the Port. Our How would you summarise the Port’s performance Here in Pembrokeshire, we have world-class natural energy sources, in 2018? a high-skill supply chain, fabrication and deployment spaces with teams, as always, have worked hard to Our turnover fell by 1% to £22.1m, with a fall in operating profit governmental recognition of the value of marine renewables. from £3.0m to £0.9m. This was largely as a result of reduced Alongside industry partners, we have been developing the Pembroke ensure that the people and businesses Liquefied Natural Gas (LNG) and Pembroke Port cargo revenues. Dock Marine project and seek to deliver enhancements that will that depend on us can continue to We recorded a loss of £1.0m after tax, however this was help capture the full market potential - as well as having cross- exceptional and due, in part, to investment property revaluations application for the wider maritime sector. depend on us. We are a small team, and pension service costs. The most significant of these is the retail Pembrokeshire also has a world-renowned reputation for the but we have international reach, park revaluation. This has been caused by a dip in retail market beauty of its natural landscape and the excellence of its outdoor expectations at a national level. Its impact on profit after tax is leisure experiences. Our other flagship project, Milford Waterfront, unrealised. The underlying performance of the business has been complements this proposition by delivering a vibrant destination,

and every single person helps us REPORT STRATEGIC maintain our strong reputation. positive and reinforces the long-term diversification goal to stabilise expanding Pembrokeshire’s ability to reach new audiences. revenue. We also experienced contractor issues on the construction Both are major infrastructure projects. We know from past As Interim Chief Executive, of the Costa site which inflated the associated costs. experience that we need to collaborate more with our We are in the minority of businesses that still operate a defined neighbouring communities, industry and governing authorities. Our I have been particularly proud of benefit pension scheme for current employees. The costs are united expertise will help deliver commercially viable projects that how everybody has come together significant and could impact our ability to operate profitably in the have impact both regionally and nationally. future. We have therefore taken the difficult decision to close this With regards to Brexit’s impact on our business, we have continued to support me as we reposition scheme to new members in order to mitigate the financial risk. It is to monitor developments. Based on our business model, the ” the responsibility of all of us in the business to recognise the crucial anticipated direct impact has been assessed as minimal, though the for the next sixty years. role we all play in achieving our Trust Port obligation to leave the impact of any associated general economic downturn is unknown. Port in the same or better condition for future generations. How is extreme weather affecting the What are the upcoming opportunities for the Port’s operations? port industry? Weather extremes do seem to be playing a more obvious role in Our core operation is focused on accommodating sea all our lives. Issues like extreme rainfall, wind and even temperature transportation - whether cargo vessels, ferry or commercial fishing. cause issues for our business and for our stakeholders. While we Such operations play an unseen role in supporting UK industry as cannot control the weather, we can ensure our infrastructure is

95% of the UK trade is transported by sea. Yet it’s done with such operating correctly. Investment, where necessary, will always be a GOVERNANCE CORPORATE efficiency, such normalcy, that it has taken Brexit for the port sector’s fundamental driver for us. fundamental value to be recognised. We need continued investment in port infrastructure to make the most of trade opportunities. We Why are stakeholder views important to the Port? We are a Trust Port, so we do not have shareholders. Instead, it is our also see a strong case for port environments to expand and act as stakeholders to whom we are accountable and understanding their catalyst locations for the growth of key UK industries. needs and views is what will shape our future. In the long term, the What was your key highlight for 2018? next generation are our stakeholders and all our decisions must bear The Port underwent its three-yearly Port Marine Safety Code them in mind. In the present, we are listening more, through formal and review. Arising from the Sea Empress oil spill in 1996, the Safety informal meetings as well as through our Stakeholder Accountability Code was developed to create a national standard for every aspect Committee. The Committee oversees activity such as the setting of of port marine safety. While it is not mandatory, we fully recognise measureable targets for performance and considers the results of our its value and strive to meet the agreed criteria. We take particular annual Stakeholder Survey. This year, when asked how the Port was pride in the positive feedback gained as part of the 2018 review, and performing against their overall expectations, 85% of stakeholders in being recognised as an important and valued contributor to responded with ‘neutral’, ‘well’ or ‘very well’ which is an increase of 17% upholding and strengthening its values. in the last two years, and a positive indicator of the work we are doing. How is the business changing? We are committed to building the Haven’s prosperity and delivering FINANCIAL STATEMENTS In many ways, it isn’t. We remain focused on delivering excellence vibrant spaces, a robust contribution to the regional economy and in our services and ensuring that we have the right infrastructure life-long career opportunities. and services in place. Our cargo, ferry and marine services remain core to our operations and we will invest to support their needs. However, we also see opportunities for growth in existing and Andy Jones, Interim Chief Executive new ventures. Andy Jones, Interim Chief Executive 6 7 Port of Milford Haven Annual Report & Financial Statements 2018 Port of Milford Haven Annual Report & Financial Statements 2018

Our People

“Our employees come from a diverse set of backgrounds and bring the skills and

enthusiasm that help REPORT STRATEGIC shape our business. Their continued drive and energy will be important as we move into our next 60 years of operations.”

Employee numbers remained stable during While we do have great examples of how 2018 with 176 at year-end. Turnover also we collaborate externally, we can improve.

remained low at 10.6% and voluntary As well as industry and the community, we GOVERNANCE CORPORATE turnover fell to 4.5%. Sickness levels for need to work more with governing 2018 also fell to 2.5% which is now below authorities to have a better chance of the national average. achieving our collective goals. Our Last year was an important year as we employees will continue to shepherd in this retained the Investors in People change for us. accreditation. We recognise the enthusiasm Ensuring our culture is supportive and of everyone in working to ensure we encourages maximum engagement is a key maintain our skill base and striving to build priority. We have traditionally focused on skills for tomorrow’s needs. physical health and safety and we are proud In delivering our collective goals, our to be lost time incident-free for two years operational teams work in close running. However, like many UK collaboration with our support teams. Their organisations, we understand that mental diverse skill sets, from accounting and health, as well as physical health, can have human resources to communications and an impact. We want to ensure that both are engineering, are critical to our overall treated equally and that wellbeing becomes FINANCIAL STATEMENTS success. Effective internal collaboration and an integral part of our employee support appreciation of each other’s contributions structure. We have established an will always be vital. We also recognise a employee-led Wellbeing Team who are need to change how we work with others. working hard to help us achieve this goal.

8 9 Port of Milford Haven Annual Report & Financial Statements 2018

Our Business

Trading Results Business Model Waterway. It also operates port facilities at bank lending. At the Group level, we finished sites in Milford Haven and Pembroke Dock, the year with £12.6m of cash after paying Trading results and key performance indicators for 2018 compared to prior year are Milford Haven Port Authority (the Port) is and has a diverse property portfolio. As a back all outstanding Port loans. In 2018, we summarised below: the statutory harbour authority for the Trust Port, the Port does not have arranged a flexible credit facility which gives 2018 2017 Port of Milford Haven. The Port, along with shareholders. All profit is retained and is access to additional funding if required, hence £’m £’m its subsidiaries, represents the Group. It available for re-investment into the business we are well placed to continue investment operates on a commercial basis, charging TURNOVER 22.1 22.4 in support of its strategy. into our trading base, react to opportunities port fees for providing conservancy and that present themselves and maintain OPERATING PROFIT 0.9 3.0 The Port, as a commercial entity in active pilotage services to the vessels delivering competition with all other ports, is financed business-critical assets as the need arises. (LOSS)/PROFIT AFTER TAXATION (1.0) 1.8 or collecting products at the principal through retained profits and conventional CARGO VOLUME 31.0m tonnes 32.1m tonnes terminals located on the Milford Haven STRATEGIC REPORT STRATEGIC CORPORATE GOVERNANCE CORPORATE FINANCIAL STATEMENTS

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Principal Risks and Uncertainties STRATEGIC REPORT STRATEGIC

During 2018, we reviewed the way we We seek new opportunities to maximise Risk to Financial Resilience In support of our vision to build the Haven’s To meet these obligations, we have report on our principal risks and the use of our assets. This requires a robust Our financial instruments comprise prosperity, we reinvest our profits into the developed a Governance Manual, established uncertainties. Our aim was to provide a inspection and maintenance regime. We borrowings, cash and various items such as business to secure the future sustainability an Audit Committee and conduct internal more strategic overview, allowing have adopted a risk-based approach, trade debtors and creditors that arise of the Port, which in turn has positive and external audits. We also seek to ensure stakeholders to gain a better appreciation implementing our Asset Management policy directly from our operations. We are not impacts across Pembrokeshire in terms of our employees abide by the highest of the full risk picture. The individual risks and undertaking what is reasonable and generally exposed to movements in job creation and economic growth. standards of governance and integrity while previously reported have not disappeared. practical to ensure assets remain in a exchange rates as we trade in sterling (GBP) focused on achieving our strategy. suitable condition. We also have powers within our Act to They are now included in more appropriate with major customers, and currencies other make investments which are likely to provide Culture, Values and Behaviours Risk categories; terrorism, for example, which is than sterling are only occasionally used. Diversification Programme Risk no less important, now sits as part of an economic, social, cultural or environmental Our core values - Safety, Collaboration and Our policy is to ensure that current cash Securing sustainable diversified income overall risk to operational continuity. benefits to all or some of the population Excellence - are central to the credibility of, reserves are held for future development streams will help us mitigate against the of Pembrokeshire. and confidence in, the Port to deliver safe and The Board reviews the overall Business within Pembrokeshire. We invest our cash significant revenue fluctuations that can Regulation, Governance and superior services. We rely on motivated and Risk Register on an annual basis. Risk balances in UK banks with low-return/low- occur within the oil and gas industry and Compliance Risk high quality employees to perform our appetite has been defined for specific risk risk deposits. We finance our operations remain out of our control. categories and is included in our Risk As a Trust Port, we are governed by an Act functions and we aim to create an with a mixture of retained earnings and The most significant risks in relation to our GOVERNANCE CORPORATE Management policy. The principal risks and of Parliament. In addition, we adopt a best environment where employees are term debt. Loans are at a fixed rate or based diversification programme are the Milford uncertainties facing the business, and practice code of governance using the empowered to the full extent of their abilities. on LIBOR and we have a revolving credit Waterfront and Pembroke Dock Marine actions taken to mitigate them, are: Department for Transport’s guidance It is recognised that we undertake activities facility to support short-term needs and developments. To mitigate these risks, we have document “Ports Good Governance that pose significant safety risks; however, we Risk to Operational Continuity future investments. established appropriate project governance Guidance” to ensure an efficient, adopt a positive safety culture through the The Milford Haven Waterway is considered We do not actively seek high-risk high- and are seeking support and advice, when accountable and competitive Trust Port. proactive reporting of accidents, incidents, a part of the UK critical national return projects and are circumspect in necessary, from external consultants. We have near misses and concerns through our infrastructure. Recognising the potential choosing our trading partners and, where a strong desire to work collaboratively with The obligations on the Port therefore are Assurance Framework. financial and reputational losses associated appropriate, joint venture partners. We our stakeholders, recognising that these (1) first and foremost to comply with its with a business disruption, we maintain and adopt financial controls in line with industry important projects cannot be delivered alone. Acts, and (2) operate so far as reasonably To mitigate behavioural risks, we invest in our exercise a robust set of contingency and best practice and manage costs as we seek Contract risks are being managed through a practicable and relevant to the particular people through training and reward and have emergency plans. This involves working to deliver on our development plans at rigorous procurement process. circumstances of Milford Haven, in established both an Employee Forum and a accordance with the guidance set out in Wellbeing Team. Our leaders work hard to closely with our stakeholders to ensure we Milford Waterfront and Pembroke Dock Risk to Reputation and Influence are prepared should an interruption occur. Marine. This necessitates continual “Ports Good Governance Guidance”. embody our values and vision and cultivate a Our reputation and influence can be affected monitoring and reviewing through vigorous positive culture. We are committed to ensuring effective and by internal failures, by external events

project governance. FINANCIAL STATEMENTS efficient operations and have established a outside our control and through the Safety and Environmental Management Risk to Fit for Purpose Assets management of our stakeholder System (SEMS) to help continually improve We have a wide variety of assets that are expectations. We have established a performance. The system follows the Plan- required to deliver services to our customers. Stakeholder Accountability Committee and Do-Check-Act cycle. We are committed to ensuring adequate have good control over our messaging and stewardship and maintenance, supported by relations with the media through a proactive sustaining a strong balance sheet. PR and Communications department. 12 13 Port of Milford Haven Annual Report & Financial Statements 2018 Port of Milford Haven Annual Report & Financial Statements 2018

Our Operational Divisions

Energy, Renewables and Engineering We are the UK’s largest energy port. In 2018 we continued to ensure the best service framework is in place for our core energy customers along the Waterway, as well as working to create new infrastructure appropriate to the needs of STRATEGIC REPORT STRATEGIC emergent energy industries. Renewable marine sourced energy is at the Transportation Transportation remains at the core of our Trade Assurance Scheme for Combinable heart of our flagship project, Pembroke operations and includes safe waterway Crops during the year, demonstrating “As the UK’s largest energy port, we are Dock Marine. This will create a new industry, navigation, cargo handling and ferry services. responsible onsite handling. We also support economic growth and create jobs, conducted a review of Pembroke Port’s focused on creating the right conditions while directly contributing to the growth of “We are responsible for ensuring that the market proposition to identify new for growth in traditional and renewable decarbonised energy. Without doubt, this is opportunities. This includes a revised approach ” the right place for a marine energy and Waterway is used safely, whether the user is to the storage of Refuse Derived Fuel (RDF) energy sectors. engineering delivery hub; Pembrokeshire has in a dinghy or an LNG tanker.” which we recognise as having the potential to world-class natural energy, the right skill make a positive contribution to the region’s base and practical experience. Funding will economy. We also joined the SNAP network play a vital role in short-term success, Over 2,000 commercial vessels used the Port (a collective of lorry parks for hauliers and helping to kick-start a nascent industry. It will in 2018, transporting over 31m tonnes of truckers) to make good use of our asset base be critical in achieving the earliest possible liquid, dry, break and project cargoes. and provide additional facilities for our clients. impact and maximising the economic Liquefied Natural Gas (LNG) performance Two key operational goals were achieved this potential of an industry projected to be remained subdued, though we have seen year. We successfully undertook an upgrade worth €653bn by 2050*. This isn’t just about CORPORATE GOVERNANCE CORPORATE some uplift in the first few months of 2019. of our Vessel Traffic Services (VTS) our business, such investment is critical to At Pembroke Port, our south shore equipment to maintain continued growing the Welsh and UK economies. In operational hub, the transportation of the operational excellence. The upgrade also the absence of third-party funding, we decommissioned Murco refinery to Pakistan enabled us to carry out a successful live, maintain our commitment but recognise continued. This has been a significant heavy extended trial of our back-up facility which that delivery scope and timescales will be lift operation and it will continue into 2019. is an important part of our commitment to significantly impacted. This operation was always going to be tinged safe navigation on the waterway. Our We maintained our strategy of investing in with regret as the refinery’s closure impacted incident response exercises are also an our own energy infrastructure. A new so many local people and businesses. It’s been important part of that commitment, and the renewable heat system, e-bikes and an an important driver for the development key agencies work closely together to expansion of the LED lighting network are work we are doing with Milford Waterfront ensure that any incident is quickly contained helping us increase efficiency across the and Pembroke Dock Marine in reducing and concluded successfully. business. Our major investment in the solar over-reliance on one industry. It is vital that we ensure a safe working farm at Liddeston, and the network of There has been significant focus on maintaining environment for all our employees while building-mounted solar panels, performed the best conditions for existing customers, maintaining expected service levels for our well with a 13% increase in solar outputs. while also developing the right facilities, spaces Waterway customers. Following two Together, these investments are driving FINANCIAL STATEMENTS and contract terms to attract new business. incidents involving our pilot boats, we have down operational costs and decreasing our Our ferry operations ran smoothly with an appointed independent experts to carry carbon footprint. 11% uplift in ferry freight traffic. The impact of out a scientific investigation to help us fully * Carbon Trust, Accelerating Marine Energy weather delays was mitigated by the fast understand the issue and explore solutions. response of our employees. We attained the

14 15 Port of Milford Haven Annual Report & Financial Statements 2018 Port of Milford Haven Annual Report & Financial Statements 2018 STRATEGIC REPORT STRATEGIC

Retail, Leisure The Milford Waterfront development The feedback has been great, with people Fishing, Fish Our focus in 2018 has been to ensure we achieved a significant goal last year. Having enjoying the Waterway’s history, wildlife and are delivering the right services and facilities and Tourism gained outline planning consent in 2015, we stunning views. With support from a Coastal Processing and for the fishing industry. Communities Fund grant, our Floatel Cabins recognised that the high street model was Milford Haven is an important hub. It is arrived towards the end of 2018 and are Aquaculture experiencing unprecedented volatility so Wales’ largest fishing dock, landing both fish being fitted out ready for the 2019 season. we adjusted our approach. This gave us an and shellfish. Our view is that critical mass Facilities were upgraded in the 4 gold opportunity to re-focus on what is unique will help deliver long-term operational anchor Milford Marina. This has proved about Milford Haven, and play to our viability for us and our customers. We are valuable to existing berth holders and will strengths of doorstep access to marine therefore creating the spaces and be important in attracting new visitors and leisure opportunities, beaches and other opportunities to bring together commercial berth holders. We have also invested outdoor pursuits. The revised plan brings fishing, fish processing and aquaculture. leisure and tourism to the forefront in this significantly in our assorted digital networks. 460,000 sq ft mixed use development for Our cruise season was busy with over “ In terms of facilities, we’ve secured a grant which we regained a resolution to grant Milford Fish Docks is Wales’ largest 4,100 passengers from nine calls. From the from the European Maritime Fisheries Fund outline planning consent during the year. exclusive Sea Cloud II to the grand fishing docks, where fish and shellfish can (EMFF) which is helping us to enhance the GOVERNANCE CORPORATE We see true value here for Milford Haven Albatross and Prinsendam, visitors are fishing docks' proposition. This includes the “Milford Waterfront and Pembrokeshire as we expand the year- be landed, processed and shipped to the coming to the Milford Haven Waterway provision of a new Hiab crane that will help round proposition. ” is a 460,000 sq ft from around the world. It’s a perfect launch markets quickly and efficiently. fishermen land their catch more safely and Our aim is to ensure Milford Waterfront pad to explore Pembrokeshire’s incredible efficiently. Separately, we’ve completed lock mixed used brings out the features that makes Milford landscapes. We offer two call sites, alongside During 2018, we’ve contributed to gate refinements which means our fishing development set on Haven such a unique destination. All our at Pembroke Port and anchored at Milford governmental investigation into the sector customers can get to sea faster with the activities complemented this goal, from the Haven, which offers maximum flexibility. looking at how, together, we might re- lock gates operating 24/7 with the tide. The the doorstep of a Ambassador training programme to our However, we do recognise the limitations energise fisheries. We are also continuing to expansion of our fuel services is also collaboration with the Royal Navy Museum. on Milford Haven in the absence of a world-renowned work with the aquaculture sector and are proving valuable to our customers. Our vibrant ‘What’s On’ programme, which dedicated cruise berth and the impact this exploring the needs of this industry and the Importantly, we continue to offer our own natural environment.” included the Welsh Street Food Awards and has on our other operations. economic contribution it can deliver fund, the Fishermen’s Safety Fund. This a wedding fayre, was built upon these Building on from last year’s major alongside our existing fishing client base. dovetails with the EMFF fund to tackle the foundations bringing new events and acquisition of Havens Head Retail Park, we issue of safety at sea. Once beyond the visitors to the town. have extended the base offer to include a docks, we want to remain supportive of

In terms of moving the leisure proposition hospitality outlet with the addition of a fishermen and help them stay safe. FINANCIAL STATEMENTS forward, we launched the Discover Coast & Drive-Thru Costa. This expands Milford Cleddau Boat Trips during the summer. This Haven’s national brand proposition as we is opening up the Waterway for more strive to help deliver the needs of this exploration by visitors and residents. busy town.

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Stakeholder Engagement STRATEGIC REPORT STRATEGIC

As a Trust Port, we are committed to Our communications last year recognised reinvesting our profits into the business for the different needs of our broad the Port’s future sustainability, which in turn stakeholder audience in sharing information has positive impacts across Pembrokeshire in and gathering feedback. In addition to terms of job creation and economic growth. formal stakeholder meetings, our website In the absence of shareholders, we are and social media channels were kept up to accountable to a wide range of stakeholders date with news and information, as well as from statutory bodies to local residents. We issuing the biannual community newsletter, have established a number of mechanisms to OnBoard, to the 30,000 homes and ensure those stakeholders understand the businesses along the Milford Haven role of the Port, and equally to ensure that Waterway. Feedback from our 2018 we understand their views on key issues. stakeholder survey told us that almost 50% of stakeholders felt that OnBoard has “ increased their awareness and When asked how the Port was performing understanding of the Port and its activities against their overall expectations, 85% of and therefore we will continue to provide GOVERNANCE CORPORATE information in this way. stakeholders responded with ‘neutral’, ‘well’ We also hosted the annual stakeholder or ‘very well’ which is an increase of 17% in meeting in July to which all members of the public and business community were invited. the last two years, and a positive indicator of As well as being an open floor for questions ” from our stakeholders, this provided us with the work we are doing. a great opportunity to share some important updates such as new To complement the work of the existing appointments to the Board, results from our Port Advisory Committee, we formed a annual stakeholder survey and strategic Stakeholder Accountability Committee in issues. We also updated stakeholders on the 2015 and appointed a Non-Executive progress of our two flagship projects, Milford Director with particular responsibility for Waterfront and Pembroke Dock Marine. ensuring stakeholder views are heard at To measure and benchmark our Board level. We are pleased to see that the community benefit, we subscribe to FINANCIAL STATEMENTS Department for Transport has recognised London Benchmarking Group (LBG) which this development and recommended it as is the global standard for measuring best industry practice in the 2018 “Ports corporate community investment. LBG has Good Governance Guidance”. confirmed that the Port of Milford Haven continues to stand out for the amount it

18 19 Port of Milford Haven Annual Report & Financial Statements 2018 Port of Milford Haven Annual Report & Financial Statements 2018 STRATEGIC REPORT STRATEGIC

gives to the community as a percentage of Scholarship Scheme operating profit. In 2018, the majority of Our annual Scholarship Scheme started Our Charitable Cause for 2018 “Alongside direct financial support, our staff investment was focused on projects in 2003 and has supported over 60 Each year staff at the Port vote for a relating to skill, education and improving students. In 2018, Pembrokeshire students charitable cause they feel passionate organised events and activities to raise funds access to arts and culture. Katrin Watkin-Rees, Jannah Kehoe, Isobel about. The winning charity benefits in support of Mind Pembrokeshire, our Coombe and Matthew Dawes all from a year of dedicated fundraising by 7% Community Benefit successfully secured a three-week work our team. In 2018, Mind Charitable Cause of the Year for 2018.” 20% Our core focus is the sustained re- placement at the Port in 2019, and £1,500 Pembrokeshire was chosen and 14% investment of profit to build the to support their studies. alongside financial support from the Duke of Edinburgh Haven’s prosperity. However, like Port, it benefitted from fundraising wellbeing and an active lifestyle through Anti-tombstoning Initiatives As a bronze sponsor of the Duke of any major business whose events such as a charity fun run, book art, media and dance. The project also We partnered with Milford Youth 6% addresses community safety by engaging Edinburgh’s Award, we worked with Focus of Community activities and operations play an sales, cycle to work day and Christmas Matters, Dyfed-Powys Police and Mid Pembrokeshire’s Department of 1% integral role in the local jumper day. We even purchased young people in diversionary activities Benefit 2018 and West Wales Fire and Rescue Service Education team to give more local 2% community we also, when ukuleles for Mind’s Ukulele Group. which promote a positive profile of 2% to deliver WAVE - a project to warn business performance allows, young people in Milford Haven. Under school children the opportunity to young people about the dangers of share a proportion of our profits the Bridge attracted over 118 individuals develop their skills and achieve their GOVERNANCE CORPORATE tombstoning (jumping into the sea from with local charities and community in 2018. In addition, one young person goals. A particular highlight was seeing height) and to introduce them to safe 48% organisations. Last year’s support was recorded over 20 hours of volunteering thirteen pupils from Milford Haven ways to enjoy the water. It was an broken into two distinct areas: hours within his community and went School achieve their bronze award. extremely successful event with 89% of 1. Charitable Gifts on to secure employment as a seasonal attendees saying they learnt something events assistant. Charitable gifts are processed through Health new, 96% saying they would tell others our Community Fund Committee, which about the dangers of tombstoning and Social Welfare comprises a number of staff from across 100% saying they had a better Education the business. The Committee is allocated understanding of the dangers. an annual budget and community groups Environment and charitable organisations are invited Having won an award from Arts and Economic Development to apply for funding via our website. Business Cymru in 2017 for the anti- tombstoning play, 'Would you Jump?', we Emergency Relief During 2018 over 90 community groups have benefitted from this funding, with further developed this initiative in 2018 Other clear focus on projects which aimed to to involve pupils from years 7 and 8 who collaborated with a professional writer Arts & Culture improve skills, education and access to FINANCIAL STATEMENTS arts and culture. and director to create their own 2. Community Investment storylines as a sequel to the original play. The initiatives that we have supported Under the Bridge in 2018 address issues raised, and Under the Bridge aims to address suggestions made, in our stakeholder elements of deprivation by providing survey. These include: accessible opportunities to promote 20 21 Port of Milford Haven Annual Report & Financial Statements 2018

Our Environment

“Our focus is to manage and reduce Oil spill training our operational impact on the and live incident There were nine recorded oil pollution Milford Haven Waterway and to incidents reported during the course of make a positive contribution to 2018. Three were reports of minor, non- attributable blooms which we were able to global decarbonisation efforts.” break-up with the prop wash of the boat we sent to investigate; one was the remobilisation of historical ground

contamination at Llanreath, two were REPORT STRATEGIC foundered small vessels, and three were caused by equipment failure or damage at Environmental Surveillance Group: Celebrating 25 years terminal jetties. Of these nine, the only one One of our most long-running and successful collaborations is the Milford Haven involving sustained clean-up effort was a spill Waterway Environmental Surveillance Group (MHWESG), a scientific research of an unconfirmed quantity of heavy fuel oil collective of which we are a proud and active member. This summer, it reached its 25- during December. We provided on-water year anniversary of tackling environmental management and the environmental tracking and clean-up, and participated fully changes brought about by climate change. in the multi-agency response to the incident. This organisation brings together statutory bodies and industry, all of whom contribute The ability to respond swiftly, efficiently and financially to commission scientific survey work in the Waterway to our mutual benefit. effectively to any pollution incident is a priority This activity makes the Milford Haven Waterway one of the best-studied estuaries in for us and we train and exercise accordingly. Europe, and provides a robust, scientific basis for planning, decision-making and Clean seas pledge environmentally sound operation within the Waterway. Of particular value are some long-term studies the Group has been able to accomplish, providing deep understanding of the fates and long-term behaviours of hydrocarbon and metal pollutants in the estuary system, and the pressures faced by the ecosystem through the indicator species shelduck.

2018 saw a major increase in activity in GOVERNANCE CORPORATE Wales to grapple with the problem of For more information on the MHWESG, please see the Group’s own Annual Report. plastic pollution, systemic in the global The member organisations are: Port of Milford Haven, Valero Pembroke Refinery, economy and environment. We are a South Hook LNG, Dragon LNG, Valero Pembrokeshire Oil Terminal, RWE Power, member of the Wales Clean Seas Puma, Natural Resources Wales, Pembrokeshire County Council and Pembrokeshire Partnership which will implement the first Coast National Park Authority. Marine Litter Action Plan for Wales. Our Decarbonisation commitment to reduce the plastic waste We fully recognise the contribution made by anthropogenic greenhouse gas emissions reaching the sea was encapsulated by to global climate change. As such, we seek to reduce our emissions and respond to signing the Wales Clean Seas Pledge in early Atrina fragilis the need to decarbonise the economy. It is why we invested heavily in renewable summer 2018. A notable occurrence in 2018 was the shell means it is susceptible to physical energy generation on our estate. We remain committed to waste reduction rediscovery in the Waterway of a species damage as well as to pollution. The 2018 photovoltaic generation totals: and reduction in plastic use, but also to which had not been observed here for individual was discovered during Natural • Building mounted solar panels: increase of 11% to 772 MWh recovery of marine litter where possible. more than 40 years. The fan mussel, Atrina Resources Wales’ routine and regular dive • Liddeston Ridge solar array: increase of 13% to 5,187 MWh From the pilot launches removing items of fragilis, is one of Britain’s largest and most survey work to assess the health of the

flotsam from the Waterway, to the threatened molluscs, growing up to 48cm seagrass beds within the Waterway, and the FINANCIAL STATEMENTS This green energy generation supplied to business and the grid is equivalent to provision of free disposal facilities for long, and dwelling partially buried in soft presence of Atrina fragilis after such a long 1,686.81 tonnes of CO2, 3.93 tonnes of methane and 9.12 tonnes of nitrogen dioxide marine litter picked up by leisure and fishing sediment. As the name implies, its delicate period unrecorded is encouraging. for the same amount of energy generated using fossil fuels. This CO2e is offset against vessels, we do what we can to tackle part our emissions that include fuel and energy use and is calculated to total 6,182tCO2. of the wider issue of plastic pollution.

22 23 Port of Milford Haven Annual Report & Financial Statements 2018

Safety & Security

Port Marine Safety Code The Port Marine Safety Code sets out a national standard for every aspect of port marine safety. Its aim is to enhance safety for everyone who uses or works in the UK port marine environment. As the duty holder under the Code, the Board is fully committed to providing a safe environment for any person within

the Port of Milford Haven limits. Our REPORT STRATEGIC Safety and Environmental Management System embraces the concepts and standards of the Code and its best Port Safety practice guide, and is subject to both The Port’s continued investment in health and dock personnel, modelled on a ground- internal and external audit. and safety measures, recording systems and breaking system integrated into the RNLI, As part of our commitment, we training has delivered steady improvements. and long reach rescue pole training. We annually agree a safety plan and are This is the second year with zero Lost have also introduced a Wellbeing Team, required to report on success in Time Incidents, and the Non-Lost Time acknowledging the importance of positive achieving objectives. 70 actions were Incident Frequency Rate was the lowest mental health. identified in 2018 for the marine score in recorded history, something we We are a mixed operation business and division, with a 96% completion target see as great progress. As proud as we are working with the public remains a core aspect rate achieved. in achieving this goal, we do not rest on our for many of our operations, including cruise The Port of Milford Haven’s Board laurels and will continue to maintain a safe calls and large-scale events. All were delivered formally declared its compliance to the working environment. without any reported incidents. Port Marine Safety Code in 2018 (this While we already meet strict international is conducted every three years so is and national health and safety standards, we Port Security

next due in 2021). We gained particular GOVERNANCE CORPORATE are committed to continual improvement There were no reported security incidents recognition for our dedication to in order to make sure the Port of Milford in 2018. ensuring the highest standards, and Haven meets or exceeds benchmarks set In managing our responsibilities, we being a strong voice for enhancing and by the UK’s port industry. Examples of new recognise the continued need to follow the strengthening the Code. initiatives include the introduction of International Ship and Port Facility Security Saviour Medical training to our boat crews Code. This provides a framework for “ evaluating risk which has been adopted We take pride in achieving zero Lost Time within our operations. Incidents and zero security incidents but will We have continued to work with UK Border Force and Security Services to keep not cease in our efforts to ensure that the the Waterway secure. Port remains a safe and secure environment.”

The Strategic Report has been approved by the Board of Directors and signed on behalf of the Board. FINANCIAL STATEMENTS

Chris Martin, Chair 8th April 2019

24 25 Port of Milford Haven Annual Report & Financial Statements 2018 Port of Milford Haven Annual Report & Financial Statements 2018

Corporate Governance

The Port of Milford Haven is a Trust Port, a on the Port within the defined port limits, In addition to the Acts, the Department for The obligations on the Port therefore are statutory entity that was brought into for example in relation to setting the rules Transport has over the years developed a (1) first and foremost to comply with the existence by a specific Act of Parliament - for navigation and the power for directing body of guidance for Trust Ports, the most Acts as a fundamental legal requirement The Milford Haven Conservancy Act 1958. vessels. It also confers obligations, such as recent iteration of which is entitled “Ports and (2) operate so far as reasonably This and subsequent Acts can be found the obligation to maintain, improve, protect Good Governance Guidance". This practicable and relevant to the particular online via the Corporate Governance pages and regulate navigation, and rights, such as guidance, which does not have any legal circumstances of Milford Haven, in on our website. the right to levy charges. Our profits must force, nonetheless authoritatively sets out accordance with the guidance set out in The Acts form our constitution, defining be reinvested in the business to ensure it principles of openness, accountability and “Ports Good Governance Guidance”. what we may or may not do, and how we remains viable for future generations. fitness for purpose in managing harbours in We meet these obligations and are noted are governed. They confer certain powers The Port of Milford Haven is an the broad public interest. It covers for having leading processes. independent statutory undertaking. We do corporate governance, stakeholder STRATEGIC REPORT STRATEGIC not pay out any dividends to shareholders, engagement, provision of information, safety and nor do we receive direct budgetary and a number of other topics. support from government. CORPORATE GOVERNANCE CORPORATE FINANCIAL STATEMENTS

26 27 Port of Milford Haven Annual Report & Financial Statements 2018 Port of Milford Haven Annual Report & Financial Statements 2018

In Numbers: 7 Non-Executive Directors

Meet the Port of Milford Haven’s Board 2011: 1

2012: 3

2015: 1 The Board is instrumental in shaping our strategic and operational developments. With the addition of Ian Shipperley, Debra Williams and Steve Phillips in 2018, complementing the 2018: 3 existing Non-Executive Directors, the Board is well-positioned to drive our diversification Gender Diversity: 5:2 Length of Service strategy as well as maintaining our core operations. Non-Executive Directors

Chair Non-Executive Director R Chris Martin N Ian Shipperley As Chair, Chris is passionate about creating the right culture in the Port; his aim is to With a 40 year career in the Royal Navy, Ian is the Board’s key strategic advisor for N ensure our employees thrive and play an active role in delivering to their full potential marine operations and risk. His enviable track record incorporates project delivery, and, in turn, driving the success of the organisation. Chris’ extensive industry experience strategic transformational change and management of risk and safety at senior leadership is proving invaluable in ensuring the Port’s strategy and activities harmonise, and that level. Ian has been instrumental in advancing the Port’s risk profile and advising on marine

Safety, Excellence and Collaboration remain core values. As well as holding a range of operations. His experience in leading a major capital infrastructure optimisation REPORT STRATEGIC private and public sector advisory and board roles, Chris has an SME owner business programme is of additional value as we seek to maximise the best use of our asset base. background so recognises the importance of strong relationships between large and Non-Executive Director small businesses. Born and bred in Pembrokeshire, Chris has an innate understanding A Debra Williams of the issues the county faces and is clear about its strengths and weaknesses. He is Debra will be focused on marketing and consumer relations within the Port, bringing R proud to support our vision to build the Haven’s prosperity and to deliver a bright and extensive experience in commercial operations, e-commerce, innovation and buoyant future for the region. leadership. As the former Managing Director of Confused.com, Debra is well placed to guide the business as we continue to develop new ventures in the consumer arena.

N Andrew Edwards Vice-Chair With the Port’s focus on championing innovation, Debra, who was Welsh Woman of Andrew is an important advocate for managing and maintaining strong stakeholder the Year for Innovation in 2006, is ideally positioned to advise. She was also recognised S relationships, both internally and externally. He chairs the Stakeholder Accountability as one of the UK’s top 200 business women by the Queen in February 2007. Committee, guiding on issues that impact the Port’s wide-ranging stakeholder base. Non-Executive Director He has particular focus on Critical Incident Management, applying skills developed A Steve Phillips Steve brings significant financial and commercial experience to the Port, not only from during a long career covering both operational and strategic policing roles. As a Welsh S speaker, Andrew advises on how the Port can balance the demands of its international his current role as Group Finance Director for the Welsh Rugby Union, but from his audience with its increasing home audience profile. previous experience with the regional airport owners TBI. He has an extensive risk management background which, together with his mergers and acquisitions experience, will help guide the Port through its ambitious diversification strategy. Also, his experience A Rick Squires Non-Executive Director in overseeing major capital expenditure projects will be crucial in helping the Port deliver GOVERNANCE CORPORATE Rick’s energy focus is an invaluable contribution to the Port’s strategy. He brings a on its exciting expansion programmes for Milford Waterfront. clear understanding of traditional and developing energy markets having spent 28 years with Royal Dutch Shell Group, both in the UK and overseas, and as non-executive in Executive Directors numerous other energy-related businesses. He brings all-round commercial acumen Executive Director & Interim Chief Executive to his role as Non-Executive Director and has been an important voice in championing N Andy Jones energy developments within the Port. In 2018, Andy took on the mantle of Interim Chief Executive. He is charged S with advancing the Port’s strategy at a key time. Working closely with the rest

R Anne Jessopp Non-Executive Director of the Board and the Port’s executive and operational teams, Andy has been Anne’s primary area of expertise is in Human Relations. She has worked extensively on focusing on consolidating the business operations and creating the right culture change and her experience will be invaluable in supporting the Chair and the conditions for future growth. Since joining the Port in 2011, Andy has managed Senior Management Team as the Port looks to reanimate its culture. Anne brings key strategic investments and has particularly championed the Port’s flagship commercial, manufacturing and consumer experience with a range of blue chip projects, Milford Waterfront and Pembroke Dock Marine, which are breaking organisations looking at strategic diversification which is bringing important insight to new ground for us. Like Chris, the company’s culture is a high priority for Andy. the Port’s diversification strategy. Anne has the honour of being the Royal Mint’s first Executive Director & Engineering Director female Chief Executive and is championing equitable access to opportunities at the Port. S Tim Bownes

Tim’s extensive background in delivering high-profile engineering projects FINANCIAL STATEMENTS makes him a key asset to the Board and the business. He has a wide range of experience covering major port infrastructure developments in the UK and overseas, which has included work in environmentally sensitive areas. His focus R Remuneration Committee A Audit Committee is advising on planning and delivery of the Port’s capital infrastructure projects. N Nominations Committee S Stakeholder Accountability Committee

28 29 Port of Milford Haven Annual Report & Financial Statements 2018 Port of Milford Haven Annual Report & Financial Statements 2018

…and our Senior Management Team Report of the Board

The Directors present their Annual Report policies, the delivery of port and harbour regulation to the highest standards of safety for the year ended 31 December 2018. services, and to provide proper oversight and with appropriate financial prudence. Certain information regarding principal and direction in relation to the safety of The Board operates a number of risks and future prospects has been operations and the financial performance of committees to support its functions. These included within the Strategic Report. all business activities. are described below: The Port of Milford Haven Board Selection and appointment of Non- Audit Committee - - Chair, Chris Martin Executive Directors should be based on Chair, Steve Phillips Andy Jones Interim Chief Executive Tim Bownes Engineering Director each non-executive bringing a particular (see page 29) (see page 29) The Milford Haven Port Authority Act 2002, This Committee’s terms of reference allow skill set or specialisation to the Board to as amended by the Milford Haven Port it to consider any matter relating to the Authority Harbour Revision Order 2012, cover the following headings: Vidette Swales Human Resources Director financial affairs of the Port and include the

specifies that the Board shall comprise the • Chair REPORT STRATEGIC Vidette’s clear focus is on developing our most important asset, our people. Her career monitoring of financial reporting, accounting Chair, the Chief Executive, between six and • Marine has encompassed both the public and private sectors and she is a Fellow of the policies, matters relating to the auditors, the eight other Non-Executive Directors and Chartered Institute of Personnel and Development. She was instrumental in retaining • Energy adequacy of the Port’s internal financial up to three other Executive Directors. the Investors in People award in 2018 and will continue to work closely with the • Finance controls and, at the request of the Board, to Board and the business to ensure our employees are equipped to deliver our long- The Chair is appointed by the Secretary of • HR review and monitor the Port’s risk term strategic goals. State for Transport through an open • Stakeholders management systems. The Audit Committee competitive selection process. All other has primary responsibility for the • Commercial Harbourmaster and Marine Director Non-Executive Directors are appointed by appointment, reappointment and removal of Mike Ryan These skill sets may be amended from time- the Board itself through a similarly open external auditors and safeguards the Responsible for the safe use of the Waterway by all users, Mike works with the Board to-time to reflect the changing business process. For any board position, including auditor’s independence. The chair of this and the operational business units to ensure our marine operations work effectively, interests of the Port. the Chair, the position is advertised and an Committee is the Non-Executive Director and that we maintain the level of service our customers expect from us. Gained during independently-led appointment panel is The Board meets regularly, at least six times with the appropriate finance and accounting a long Naval career, Mike brings extensive experience in managing complex operational formed to shortlist and interview a year. A Vice Chair is appointed from background. The Audit Committee situations. His focus is on delivering strategic and operational goals, and on maximising candidates. In every case the appointment amongst the Non-Executive Directors and in comprises three Non-Executive Directors efficiencies and best practice in a safe working environment. panel recommends its preferred candidate such capacity serves as the Senior with the Chief Executive and the Chief for appointment. Each appointment is for a Independent Director. The Non-Executive Financial Officer also in attendance. Neil Jenkins Development Director three-year term. This is in line with Directors meet on a regular (but not Neil’s primary focus is on delivering the Milford Waterfront development. With a Brief summary of activity for 2018: government policy - “Ports Good frequent) basis without the Executive background in property development in London, Wales and the Channel Islands, Neil’s During the year, the Committee appointed GOVERNANCE CORPORATE Governance Guidance”. Directors, and on occasion without the Chair, unique experience covers independent and corporate developments. His drive is to a new Chair and also appointed a new to review general workings of the Board. ensure the development creates a balance of opportunities for local businesses and The means of selection of Directors is in Non-Executive Director. Furthermore, the A register of Directors’ interests is nationally recognised brands, while ensuring leisure and tourism is at the heart of accordance with guidelines laid down by Committee reviewed and recommended to maintained which includes landholdings, Milford Waterfront. the Government for all Trust Ports and the Board the approval of the Annual follows what are commonly termed ‘Nolan shareholdings and other responsibilities and Report 2017 after consulting with and principles’. All Directors must adhere to the appointments, together with the Mark O’Connor Interim Chief Financial Officer receiving the relevant reports from the requirement to identify any issues that Mark is working with the Board and the Senior Management Team to ensure our following guiding principles of conduct: auditors. On a similar theme, the could be perceived as a conflict of interest. financial structure is performing to the best of its abilities, and advising on the need • Independence Committee met with auditors in advance The Port also maintains a hospitality for relevant adjustments. His long experience with a diverse set of businesses will • Accountability of the planning of the audit for the Annual register for all Directors and managers. bring crucial insight. • Openness Report 2018. In addition, the Committee The determination and implementation of met with the Internal Audit advisers which • Selflessness the Group’s strategy is the key remit of the helped guide their planning on the • Integrity For more information on our Board members and Senior Management Team, please visit Board. In addition, the Board is ultimately significant risks faced by the Port. the Strategy & Governance section of our website. • Objectivity responsible for the operational performance, Remuneration Committee – • Honesty including safety performance, of the Group.

Chair, Anne Jessopp FINANCIAL STATEMENTS • Leadership It is therefore part of the Board’s role to The primary duties of the Remuneration The duties of a Director are akin to those monitor the performance of the Committee are to determine the broad of a director of a company. In particular, to management and satisfy itself, through review framework for the Port’s Remuneration be accountable for the proper exercise of of the risk register and other reporting policy, determine remuneration and the Port’s statutory functions, the systems and procedures, that the Port employment conditions of the senior identification and setting of business operates in compliance with the law and managers and to make recommendations 30 31 Port of Milford Haven Annual Report & Financial Statements 2018 Port of Milford Haven Annual Report & Financial Statements 2018 STRATEGIC REPORT STRATEGIC to the Board as to the fees and emoluments recommending appointments to the Board. a Trust Port, holds itself properly Board level. A key topic of discussion during Committee is supported by a secure, The Directors have reviewed the of Non-Executive Directors in relation to In particular, this Committee must assess accountable to its stakeholders. This entails the year was the review of Key Performance interactive website that facilitates the effectiveness of the system of internal any activities undertaken on behalf of the time commitments of Board posts and ensuring that the Port correctly obtains and Indicators and the Committee is currently exchange of views between committee control in accordance with the principles Milford Haven Port Authority. This ensure that the individual has sufficient understands the needs and views of its making further recommendations for more members and the Port, and allows included in the UK Corporate Governance Committee is also charged with available time to undertake them. It will stakeholders and, in the context of the strategic KPIs in addition to the existing those views to be fed into the Port’s Code and other relevant guidance. determining bonus structures for senior meet as appropriate to consider whether or Port’s statutes and relevant public guidance operational KPIs. The Committee also decision-making. Investment Policy and policy, sets an appropriate strategy and endorsed the Port’s strategic proposals to managers and staff and advising on not Non-Executive Directors coming to the Corporate Governance Our policy is to ensure that investments employee benefit structures. It also ensures end of their term of office should be put direction for the business. This Committee explore the concept of Free Port status, to The Directors are committed to high achieve long-term commercial viability and that levels of Board remuneration and forward for reappointment. Membership of has particular oversight of the setting of pursue the Swansea Bay City Deal, and to standards of corporate governance and sustainability for the Port, its users, its expenses claimed are detailed in the Annual this Committee is determined by the Board measurable targets for the performance of advocate for extending the boundary of the have implemented systems of corporate employees and stakeholders. Accounts. It consists of not less than three but will be made up of at least four the Port and acts as an appeals committee Milford Haven Waterway Enterprise Zone to governance compliant with the principles of The primary objective of the Port of Non-Executive Directors including the members including the Chair or Vice Chair to which stakeholders should direct include all Milford Waterfront areas. the "Ports Good Governance Guidance" Milford Haven is to generate commercial Chair. The HR Director acts as Secretary to and the Chief Executive. concerns in the first instance. It The Board is also directly accountable for: and the relevant sections of the UK rates of returns on its investments, while the Committee (in a non-voting capacity). Brief summary of activity for 2018: corresponds directly with stakeholders and Executive Corporate Governance Code. maintaining security of assets. Brief summary of activity for 2018: reports on its proceedings to the Board. The Committee met twice during the year Internal Control and Details of the primary 2018 capital Membership of this Committee comprises The Chief Executive and Senior GOVERNANCE CORPORATE In 2018, the Committee reviewed the and was pleased to receive a report on the two Non-Executive and two Executive Management Team (SMT) are accountable Risk Management investments are provided within the bonus scheme provision for employees successful conclusion of three new Directors and four external stakeholder to the Board for the implementation of The Directors are responsible for the Strategic Report. which has led to an amended structure for specialist Non-Executive Director members appointed by the Board. Board policy, the management of the Port’s system of internal control. Such a Going Concern 2019. To increase the link with individual appointments for onward recommendation business and affairs of the Port. The SMT system provides reasonable but not The financial statements have been performance, a separate bonus for to the Board. Three other Non-Executive Brief summary of activity for 2018: meets regularly as a group. absolute assurance against material loss prepared on the going concern basis. After exceptional performance which is not Directors, following a successful appraisal During the year the Committee oversaw the or misstatement. making due enquiries, the Directors have a dependent on the main bonus scheme process, had been recommended for Stakeholder Survey and was particularly Port Advisory Committee Key procedures that have been established reasonable expectation that the Group has triggering has been introduced. A separate reappointment for a further term. This was pleased to see a 70% increase in the number In accordance with its Act of Parliament 1983, include an organisational structure with adequate resources to continue in safety bonus continues to be a feature. The undertaken to provide for an overall of people taking part compared to 2016. 85% the Port meets twice a year with clear operating procedures, lines of operational existence for the foreseeable Committee also undertook a review of the smoother sequential Non-Executive of stakeholders also said the Port was representatives from groups of major responsibility and delegated authority. In future. Accordingly, they continue to adopt performance, succession planning and Director appointment process and better performing ‘neutrally’ ‘well’ or ‘very well’ stakeholders. Representatives sit on the Port particular, there are defined procedures for: the going concern basis in preparing the future capability of the senior team. align the consultative appointment process against their expectations. In accordance Advisory Committee and the meetings • capital investment covering appraisal financial statements. Nominations Committee - with Pembrokeshire County Council at the with the recommendations made in the provide a forum for confidential discussion and authorisation Directors Chair, Chris Martin end of 2020. Following the departure of the Department for Transport’s "Ports Good and interaction between the Port and these Port’s Chief Executive, a process to recruit Governance Guidance", the Committee also stakeholders. The objectives of this •financial reporting within a The Directors who served during the year The Nominations Committee undertakes a a replacement has started and new approved a new complaints policy. The Board Committee are to enable relevant statutory comprehensive financial planning and are disclosed on pages 38 to 39. FINANCIAL STATEMENTS formal process of reviewing the balance and membership of committees agreed. was also able to confirm adherence with the authorities and users of the Port and the accounting framework effectiveness of the Board, identifying the Directors’ Indemnities Guidance’s recommendation on setting up a Waterway to meet and interact with each • internal audit to monitor the system of skills and job descriptions required for Stakeholder Accountability During the year the Port has made Stakeholder Accountability Committee and other and the Port, with the particular internal control individual Board positions, including Committee - Chair, Andrew Edwards qualifying third party indemnity provisions the appointment of a Non-Executive objective of focusing on the work of the Port • risk management, and executive members. It is also tasked with The Stakeholder Accountability Committee for the benefit of its Directors which Director to represent stakeholder views at and the operation of the Waterway. • the procurement of goods and services managing the recruitment process and is responsible for ensuring that the Port, as remains in force at the date of this report. To promote further engagement, this 32 33 Port of Milford Haven Annual Report & Financial Statements 2018 Port of Milford Haven Annual Report & Financial Statements 2018

Directors’ Responsibilities Statement

Disclosure of Information to of any relevant audit information and to the Auditor establish that the Port’s auditor is aware Each Director at the date of approval of this of that information. report confirms that: This confirmation is given and should be (1)so far as the Director is aware, there is interpreted in accordance with the provisions no relevant audit information of which of S418 of the Companies Act 2006. the Port’s auditor is unaware; and A resolution to reappoint Deloitte LLP as (2)the Director has taken all the steps that the Port’s auditor will be proposed at the he/she ought to have taken as a Director forthcoming Board Meeting. in order to make himself/herself aware STRATEGIC REPORT STRATEGIC

Attendance at Board meetings in 2018 Board Audit Remuneration Nominations Stakeholder Committee Committee Committee Accountability The Port’s Directors are responsible for The Directors are responsible for keeping Committee preparing the Annual Report and the adequate accounting records that are Total number of meetings 7 2 6 2 2 financial statements in accordance with sufficient to show and explain the Group Board Members applicable law and regulations. and the Port’s transactions and disclose Tim Bownes 7 Company law requires the Directors to with reasonable accuracy at any time the Sue Davenport (Resigned 31 January 2018) 1 1 prepare financial statements for each financial position of the Port and enable them to ensure that the financial Alec Don (Resigned 17 October 2018) 5 1 5 1 2 financial year. Under that law the Directors have elected to prepare the financial statements comply with the United Andrew Edwards 6 2 1 statements in accordance with United Kingdom Harbours Act 1964, as amended Anne Jessopp 6 6 Kingdom Generally Accepted Accounting by the United Kingdom Transport Act 1981. Andy Jones (Appointed Interim Chief Executive 17 October 2018) 7 2 1 1 2 Practice (United Kingdom Accounting They are also responsible for safeguarding the assets of the Group and the Port and Chris Martin 7 6 1 Standards and applicable law), including FRS hence for taking reasonable steps for the Steve Phillips (Appointed 1 March 2018) 5 2 1 102 “The Financial Reporting Standard applicable in the UK and Republic of prevention and detection of fraud and Ian Shipperley (Appointed 26 January 2018) 6 1 (observer) 1 Ireland”. Under company law the Directors other irregularities. CORPORATE GOVERNANCE CORPORATE David Snelson (Resigned 31 January 2018) 1 1 1 must not approve the financial statements The Directors are responsible for the Rick Squires 6 2 unless they are satisfied that they give a true maintenance and integrity of the corporate Debra Williams (Appointed 1 March 2018) 6 1 5 and fair view of the state of affairs of the and financial information included on the Group and the Port and of the profit or loss Port’s website. Legislation in the United External Members of the Group and the Port for that period. Kingdom governing the preparation and Ed Tomp, Valero 2 In preparing these financial statements, the dissemination of financial statements may Ian Westley, Pembrokeshire County Council (PCC) 2* Directors are required to: differ from legislation in other jurisdictions. David Jones, Marine Energy Wales 2 • select suitable accounting policies and Stan McIlvenny, Haven Waterway Enterprise Zone 1 then apply them consistently; * PCC sent a nominee to attend one meeting • make judgements and accounting estimates that are reasonable and prudent; • state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and

explained in the financial statements; and FINANCIAL STATEMENTS Approved by the Board of Directors and signed on behalf of the Board. • prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Port will continue in business. Chris Martin, Chair 8th April 2019 Gorsewood Drive, Milford Haven, Pembrokeshire, SA73 3EP

34 35 Port of Milford Haven Annual Report & Financial Statements 2018 Port of Milford Haven Annual Report & Financial Statements 2018 Independent Auditor’s Report to the Directors of the Port

Report on the audit of further described in the auditor's In connection with our audit of the Auditor’s responsibilities for the Matters on which we are required the financial statements responsibilities for the audit of the financial financial statements, our responsibility is audit of the financial statements to report by exception statements section of our report. to read the other information and, in doing Our objectives are to obtain reasonable We have nothing to report in respect of the Opinion We are independent of the Group and the so, consider whether the other assurance about whether the financial following matters where we are required In our opinion the financial statements: Port in accordance with the ethical information is materially inconsistent with statements as a whole are free from material to report to you if, in our opinion: the financial statements or our knowledge • give a true and fair view of the state of requirements that are relevant to our audit misstatement, whether due to fraud or error, • adequate accounting records have not obtained in the audit or otherwise appears the Group’s and of the Port’s affairs as at of the financial statements in the UK, and to issue an auditor's report that includes been kept by the Port, or returns adequate to be materially misstated. If we identify 31 December 2018 and of the Group’s including the Financial Reporting Council’s our opinion. Reasonable assurance is a high for our audit have not been received from such material inconsistencies or apparent loss for the year then ended; (the ‘FRC’s’) Ethical Standard, and we have level of assurance, but is not a guarantee that branches not visited by us; or fulfilled our other ethical responsibilities in material misstatements, we are required to an audit conducted in accordance with ISAs • have been properly prepared in • the Port’s financial statements are not in accordance with these requirements. We determine whether there is a material (UK) will always detect a material accordance with United Kingdom agreement with the accounting records REPORT STRATEGIC believe that the audit evidence we have misstatement in the financial statements misstatement when it exists. Misstatements Generally Accepted Accounting Practice, and returns; or or a material misstatement of the other including Financial Reporting Standard obtained is sufficient and appropriate to can arise from fraud or error and are information. If, based on the work we have • certain disclosures of Directors’ 102 “The Financial Reporting Standard provide a basis for our opinion. considered material if, individually or in the performed, we conclude that there is a aggregate, they could reasonably be remuneration specified by law are not applicable in the UK and Republic of Conclusions relating to material misstatement of this other expected to influence the economic made; or Ireland”; and going concern information, we are required to report decisions of users taken on the basis of these • we have not received all the information • have been prepared in accordance with We are required by ISAs (UK) to report in that fact. financial statements. and explanations we require for our audit. the requirements of the United Kingdom respect of the following matters where: Harbours Act 1964 as amended by the We have nothing to report in respect of A further description of our We have nothing to report in respect of • the Directors’ use of the going concern United Kingdom Transport Act 1981. these matters. responsibilities for the audit of the financial these matters. basis of accounting in preparation of the statements is located on the FRC’s website We have audited the financial statements of financial statements is not appropriate; or Responsibilities of Directors Use of our report the Port and the Group which comprise: As explained more fully in the Directors’ at: www.frc.org.uk/auditorsresponsibilities. • the Directors have not disclosed in the This report is made solely to the Directors, Responsibilities Statement, the Directors This description forms part of our • the consolidated and Port profit and loss financial statements any identified as a body, in accordance with the United are responsible for the preparation of the auditor’s report. account; material uncertainties that may cast Kingdom Harbours Act 1964, as amended financial statements and for being satisfied • the consolidated and Port statement of significant doubt about the Group’s or Report on other legal by the United Kingdom Transport Act 1981. that they give a true and fair view, and for comprehensive income; the Port’s ability to continue to adopt the Our audit work has been undertaken so such internal control as the Directors and regulatory • the consolidated and Port balance sheets; going concern basis of accounting for a that we might state to the Directors those determine is necessary to enable the requirements matters we are required to state to them • the consolidated and Port statements of period of at least twelve months from GOVERNANCE CORPORATE preparation of financial statements that are in an auditor’s report and for no other changes in equity; the date when the financial statements Opinions on other matters free from material misstatement, whether purpose. To the fullest extent permitted by • the consolidated cash flow statement; and are authorised for issue. In our opinion, based on the work due to fraud or error. law, we do not accept or assume • the related notes 1 to 28. We have nothing to report in respect of undertaken in the course of the audit: In preparing the financial statements, the responsibility to anyone other than the these matters. • the information given in the strategic The financial reporting framework that has Directors are responsible for assessing the Port and its Directors as a body, for our report and the report of the board for been applied in their preparation is Other information Group’s and the Port’s ability to continue audit work, for this report, or for the the financial year for which the financial applicable law and United Kingdom The Directors are responsible for the other as a going concern, disclosing, as applicable, opinions we have formed. statements are prepared is consistent Accounting Standards, including Financial information. The other information matters related to going concern and using with the financial statements; and Reporting Standard 102 “The Financial comprises the information included in the the going concern basis of accounting Reporting Standard applicable in the UK annual report, other than the financial unless the Directors either intend to • the strategic report and the report of the and Republic of Ireland” (United Kingdom statements and our auditor’s report liquidate the Group or the Port or to cease board have been prepared in accordance Generally Accepted Accounting Practice). thereon. Our opinion on the financial operations, or have no realistic alternative with applicable legal requirements. David Hedditch FCA (Senior Basis for opinion statements does not cover the other but to do so. In the light of the knowledge and Statutory Auditor) We conducted our audit in accordance information and, except to the extent understanding of the Group and of the Port for and on behalf of Deloitte LLP with International Standards on Auditing otherwise explicitly stated in our report, and their environment obtained in the Statutory Auditor FINANCIAL STATEMENTS (UK) (ISAs (UK)) and applicable law. Our we do not express any form of assurance course of the audit, we have not identified Cardiff, United Kingdom responsibilities under those standards are conclusion thereon. any material misstatements in the strategic 8th April 2019 report or the report of the board.

36 37 Port of Milford Haven Annual Report & Financial Statements 2018

Financial Statements

Officers and Professional Advisers Directors Chief Executive Registered Office T Bownes A M Jones (Appointed Interim Chief Executive 17 October 2018) Gorsewood Drive, Milford Haven, Pembrokeshire SA73 3EP Chair C Martin S Davenport (Resigned 31 January 2018) A J W D Don (Resigned 17 October 2018) Banker A J W D Don (Resigned 17 October 2018) Barclays Bank plc Vice Chair Harbourmaster A Jessopp A Edwards (Appointed Vice Chair 23 March 2018) M Ryan A M Jones Solicitors D Snelson (Resigned 31 January 2018) Blake Morgan LLP S Phillips (Appointed 1 March 2018) I Shipperley (Appointed 26 January 2018) Auditor R Squires Deloitte LLP, Cardiff, United Kingdom D Williams (Appointed 1 March 2018) STRATEGIC REPORT STRATEGIC CORPORATE GOVERNANCE CORPORATE FINANCIAL STATEMENTS

38 39 Port of Milford Haven Annual Report & Financial Statements 2018 Port of Milford Haven Annual Report & Financial Statements 2018

PROFIT AND LOSS ACCOUNT BALANCE SHEET Year ended 31 December 2018 At 31 December 2018

Group Port Group Port Note 2018 2017 2018 2017 Note 2018 2017 2018 2017 £’m £’m £’m £’m Restated Restated TURNOVER 3 22.1 22.4 20.4 21.4 £’m £’m £’m £’m Cost of sales (12.9) (12.7) (12.9) (12.6) FIXED ASSETS Tangible assets 10 84.3 86.2 65.4 66.1 GROSS PROFIT 9.2 9.7 7.5 8.8 Investments 11 - - 21.4 21.4 Operating expenses (7.9) (6.7) (7.6) (6.4) Impairment of fixed assets 10 (0.4) - (0.4) - 84.3 86.2 86.8 87.5

OPERATING PROFIT/(LOSS) 0.9 3.0 (0.5) 2.4 CURRENT ASSETS STRATEGIC REPORT STRATEGIC Stocks 12 0.3 0.2 0.3 0.2 (Loss)/gain on revaluation of fixed assets 10 (1.0) 0.5 - 0.5 Debtors Write-off acquisition costs of subsidiary 11 - (0.3) - - -due within one year 13 5.7 7.0 5.7 6.8 -due after one year 13 1.1 - 1.2 0.1 (LOSS)/PROFIT BEFORE INTEREST (0.1) 3.2 (0.5) 2.9 Cash at bank and in hand 12.6 16.0 10.9 15.2 Net finance costs 4 (0.5) (0.6) (0.2) (0.3) 19.7 23.2 18.1 22.3 (LOSS)/PROFIT BEFORE TAXATION 5 (0.6) 2.6 (0.7) 2.6 CREDITORS: AMOUNTS FALLING DUE Tax on (loss)/profit on ordinary activities 9 (0.4) (0.8) (0.2) (0.8) WITHIN ONE YEAR 14 (4.9) (10.8) (4.1) (9.8)

(LOSS)/PROFIT FOR THE NET CURRENT ASSETS 14.8 12.4 14.0 12.5 FINANCIAL YEAR (1.0) 1.8 (0.9) 1.8 TOTAL ASSETS LESS CURRENT LIABILITIES 99.1 98.6 100.8 100.0 All results derive from continuing operations. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR 15 (11.0) (9.4) (19.6) (18.2) CORPORATE GOVERNANCE CORPORATE STATEMENT OF COMPREHENSIVE INCOME Year ended 31 December 2018 PENSION LIABILITY 19 (14.9) (17.5) (6.5) (8.6)

Group Port NET ASSETS 73.2 71.7 74.7 73.2 Note 2018 2017 2018 2017 £’m £’m £’m £’m RESERVES Revaluation reserve 24 25.1 26.1 26.0 26.0 (Loss)/profit for the financial year (1.0) 1.8 (0.9) 1.8 Profit and loss account 24 48.0 45.5 48.7 47.2 Actuarial gain on pension schemes: - Actuarial gain on present value of scheme liabilities 5.9 3.2 5.9 3.2 73.1 71.6 74.7 73.2 Minority interest (non-controlling interest) 25 0.1 - - Actuarial (loss)/gain on scheme assets (2.8) 2.5 (2.9) 2.7 0.1 - 3.1 5.7 3.0 5.9 73.2 71.7 74.7 73.2 Movement on deferred tax relating to pension liability 17 (1.1) (1.1) (0.6) (0.6) FINANCIAL STATEMENTS The financial statements of the Group were approved by the Directors and authorised for issue on 8th April 2019 Total comprehensive income 1.5 6.4 1.5 6.6 Signed on behalf of the Board by:

Chair Interim Chief Executive

40 C Martin A M Jones 41 42 Port ofMilford Haven &FinancialStatements2018 Annual Report srpre t1Jnay21 4. 56 4. 25.5 42.2 25.6 40.7 2017 at1January As reported Transfer inrelationto torevaluationreserve - 6.6 - 6.4 Total comprehensive income - (1.1) - (1.1) Movement taxonpension(note17) indeferred - 5.9 - 5.7 gainonpensionschemes(note19) Actuarial - 1.8 - 1.8 Profit for thefinancial year 25.5 41.1 25.6 39.6 2017 Restated asat1January - (1.1) - (1.1) adjustment period Prior At 31December2018 STATEMENT OFCHANGESINEQUITY t3 eebr21 80 2. 87 26.0 48.7 25.1 48.0 At 31December2018 - - (1.0) 1.0 revaluation offixed assets Transfer inrelationto torevaluationreserve - 1.5 - 1.5 Total comprehensive income - (0.6) - (0.6) Movement taxonpension(note17) indeferred - 3.0 - 3.1 gainonpension schemes(note19) Actuarial - (0.9) - (1.0) Loss for thefinancial year 26.0 47.2 26.1 45.5 2018(Restated) At 1January 0.5 (0.5) 0.5 revaluation offixed (0.5) assets Group Port Group Profit and Revaluation Profit and Revaluation Profit and Revaluation Profit and £’m £’m £’m £’m £’m £’m £’m osacut rsre osacut reserve lossaccount reserve lossaccount Net decrease cashequivalents incashand Interest received 0.1 Interest received investmentWrite-off fees onacquisition - Acquisition ofsubsidiary (3.2) Purchase offixed assets - Proceeds fromsaleoffixed assets Cash flows from investing activities Net cashinflow from operating activities ahadcs qiaet Cash andcashequivalents Cash atbankandinhand inhand: Reconciliation and tocashatbank 16.0 12.6 year cashequivalentsatendof Cash and year cashequivalentsatbeginningof Cash and Net cash(outflow)/inflow from activities financing - New bankloanraised Repayment ofbankloans Interest paid (0.2) Cash flows from activities financing Net cashoutflow from investing activities 0.3 received Grants Year ended31December2018 CONSOLIDATED CASHFLOW STATEMENT 2018 2017 2018 Note

1 2.5 21 (3.4) (2.8) (3.1) Port ofMilford Haven &FinancialStatements2018 Annual Report 16.0 £m £’m £’m 12.6 12.6 (2.9) - (0.3) (14.2) 0.1 8.4 7.6 0.1 17.8 - 16.0 16.0 (1.8) (0.7) (2.7) (0.1) 7.6 (17.0) 43

FINANCIAL STATEMENTS CORPORATE GOVERNANCE STRATEGIC REPORT 44 Port ofMilford Haven &FinancialStatements2018 Annual Report and loss account and are transferred to the Revaluation reserve. in fair value of investment will property pass through the profit professional valuers if the by Directors and year deem each necessary. undertaken appraisals by All changesevidence market on based be will value fair the so value, construction fair from materially before differ not value must amount carrying carrying revalued commenced. The at included is land which underlying of exception the with value other fair determine and interest to possible is it include as time such outgoings, until net will appropriate which cost, at measured cannotbemeasured reliably without construction undue cost oreffort, itis of course the in property investment of value fair the that considered cost.is at it recognition Whereinitial after value fair at measured is nature.Investmentproperty in thatmaterialare services byprovidesuchto operationalport investment if property it is not occupied by the Group or used classifieddevelopment)as foris held (includingland Property Investment properties thefinancial statements.preparing in basis concern going the adopt to continue Directors the facilities. current its of level the Accordingly,within operate to possible reasonably able is Group the that of showperformance, trading in changes account taking years, the five next for the existence operational adequate in foreseeable future. has The Group’s continue forecasts and projections over Group to the resources that expectation reasonable a basis.going have concern enquiries,Directors due the making After the on prepared been have statements financial The Going concern income andexpensesareeliminatedonconsolidation. 2018 as listed in note 11. All intra-group transactions, balances, joint ventures and associates for the year ended 31 December companies, subsidiary its and Port the of statements financial The consolidated financial statements of the Group include the consolidation Basis of flow statement and remuneration of key management personnel.takenrelationin financialto instruments, presentation cashaof been havestatements.Exemptions financial consolidated the of its separate financial statements, taken therefore which has are advantagepresented and of the disclosure 102alongside exemptions FRS available under to it entityin respect qualifying a Pembrokeshire SA73 3EP. The company meets the definitionplace. of Theregistered office is: Gorsewood Drive, Milford Haven, isinGBP and rounding isto the nearest million toone decimal current and prior year, are described below. Reporting currency policies,whichhaveconsistentadoptedbeen a theonbasis in Financial with 102).(FRSStandard102 Reporting accordanceaccounting particular The in and value fair at items certain the revaluation of investment properties and modified to includeare prepared under the historical cost convention as modifiedUnitedKingdom accounting by standards. financialThe statements applicable with accordance in legislation, subsequentand and the Harbours Act 1964, as amended by the Transport Act 1981 The financial statements have been prepared in accordance with accounting Basis of 1. AccountingPolicies Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS rpry(xldn netetpoet) (excludinginvestment property) Property ofdepreciationareasfollows: The rates annual instalments over the estimated useful lives of the assets. any provision for impairment. Depreciation is provided in equal Tangible fixed assets are stated at cost, net of depreciation and Tangible fixed assets Depreciation is not provided on investment properties. more tax in the future or a right to pay less tax in the future the in tax less pay to right a or future the in tax more where transactions or events that result in an obligation to pay that have originated but not reversed at the balance sheet date differences timing all of respect in recognised is tax Deferred enacted by thebalancesheetdate. the tax rates and laws that have been enacted or substantively provided at amounts expected to be paid (or recovered) tax,is using foreign and tax corporation UK tax,including Current Taxation Turnover inwhichitis earned. isrecognisedintheperiod property. investment and operational both of rents from and customers. This comprises revenue from charges to users port derived from the provision of goods and services to third party Turnover represents the amounts (excluding value added tax) Turnover for obsolete, slow-movingmade ordefective itemswhere appropriate. is Provision sell. and complete to costs less price selling estimated and cost of lower the at stated are Stocks Stocks is capitalised and written off over its useful economic life. in the consolidated balance sheet. Goodwill arising on theacquisition Group’s share of the respective assets and loss liabilities is and shownaccountincludesGroup’stheprofits losses, ofshareless profit while consolidated method.The equity the using Investmentsjointventuresinassociates and accounted are for Joint ventures associates and lower ofcostandnetrealisable value. impairment.for the at stated are assets current as held Those Investments held as fixed assets are stated at cost less provision Investments specific totheasset. money andtherisks of value time the of assessments market current reflects that are flows cash discounted to their present future value using a pre-tax discount rate estimated the use, in value assessing used.is belongs asset the which to unit cash-generating the In unless that asset does not generate cash inflows, in which case asset individual an for use. in determined value is its This and sell to costs less value fair unit’s cash-generating or asset’s an reduced.been of higher the is asset’srecoverableamount An initial after occurred has asset the of that value recoverable estimated recognition,the events more or one of result a An asset is impaired where there is objective evidence that, as assets Non-financial is loss below.recognised inprofit orlossasdescribed impairment an impairment, of evidence objective is for indicators of impairment at each balance sheet date. If there assessed are value, fair at measured those than Assets,other assets of Impairment Capital dredging 3-50years Plant andequipment assets 2 -125years Specialised marine 10-50years 20 years in theprofit and loss account. foreign in date.that at ruling differences with dealt are translation These denominated liabilities currencies at the and balance sheet date are translated at the rates assets Monetary into at sterling at the ruling the rates dates of the transactions. Transactions denominated are in translated foreign currencies Foreign exchange or prepaymentsaccruals inthebalance sheet. either as shown are paid actually contributions and year the in payable contributions between Differences post-retirement benefits is the contribution payable in the year. other and costs pension of respect in account loss and profit For defined schemes,contribution the to amount the charged after other net assets on the face of the balance sheet. resulting defineddate. benefitThe sheet asset or balance liability each is presented at separately updated are and triennially bond.least corporate at obtained are valuations actuarial rate The discount a using basis equivalent to the current ofrate return on a high quality (AA) actuarial an on measured are trustee-administered funds. Pension scheme assets and liabilities Group,theseparate ofin those fromseparately held scheme the of assets the with funded, are schemes benefit Defined immediately in the statement of comprehensive income. recognised are losses interest.and gainsto adjacentActuarial assets are shown as a net amount of otheruntil finance vesting costsoccurs. or creditsThe interest cost and thenot vestedexpected immediately,return on the costs are recognised andoverloss account ifthethe benefits periodhave vested. Ifthe benefits have costs. Past service costs are recognised immediately in the profit settlements on curtailments.and losses and staff gainsof Theyincludedare part as and costs service current the are profit Fordefined benefit schemes the amounts charged to operating Employee benefits are expectedtobesettledorrecovered. assets or liabilities tax deferred of amounts in significant which period future each in simultaneously, liabilities the settle tax current settle to basis,net a on assets and liabilities and assets the realise to or either intend which entities taxable taxation authority on either the same taxable entity or different deferred tax liabilities relate to income taxes levied byassets the same tax current against current tax off liabilities; set and b) the to deferred tax assets and right enforceable legally a has Deferred tax assets and liabilities are offset only if: a) the Group and settletheliabilitysimultaneously. asset the realise to or basis net a on settle to either intends a legally enforceable right to set off the amounts and the is Groupthere when only offset are liabilities and assets tax Current and allowances thatapply tosaleoftheasset. model and investment property is measured to using the tax rates relating tax property, Deferred plant and equipment measured difference. using the revaluation timing the of reversal the to apply to expected are that date sheet balance the by rates and laws that the have been enacted in tax or the substantively using enacted recognised measured is tax are Deferred statements. they financial which in those periods from in assessments different tax in losses and gains of inclusion results as stated in the financial from statements the that arise its and profits taxable Group’s the between differences are differences Timing date. sheet balance the at occurred have regarding investment properties isinnote10. regarding investment properties to the support determination of fair value. information Further require, Directors the as valuations full or desktop undertake consider and Directors will,turn, who in valuer independent an from received advice market The to value. reference by fair value fair at determine included and definition 102 FRS the of basis the on classified are properties Investment assets Revaluation of scheme where appropriate. See note 19 for further Directors.information. Theassumptions reflect the unique properties ofactuary each for each scheme based onassumptions agreed with the Fund. schemeliabilitiesvalueofThe prepared been hastheby some operational pilots are membersTheGroup operates oftwodefined thebenefit pensionPilots schemes and National PensionEmployee benefits 31 at as project December 2018are£2.3m(2017: this £1.1m). for loss costs and profit accumulated the The to account. off written be to need would costs cash-generating asset. a It is recognised become that, will should the project project not crystallise, the this that judgement in respect of the Milford Waterfront project. It is the Directors’ Included within fixed assets, are capitalised development costs development costs of Capitalisation be relevant. Actual results may differ from these estimates.on historical experience and other factors that are consideredother to sources. The estimates carrying andamounts associated the makeof assets about to and assumptions liabilities assumptions required thatare and are arebased estimatesnot Directors judgements, readily theapparent 1,from note in described applicationtheIn Group’stheof accounting policies, whichare Sources Estimation Uncertainty Of 2. Critical AndKey AccountingJudgements extent the that to they instrument are the not of settledamount in the carrying periodthe in to whichadded theyare arise. andeffectivemethodinterestthe using account loss orprofit directissue costs, are accounted for onanaccruals basis inthe includingpremiumspayable settlementredemption onor and charges, Finance costs. issue direct of received,net proceeds the Interest-bearingbank loans andoverdrafts which arerecorded asthe to year borrowingsBank the in account expenditure relates. loss and profit the to credited are expenditure revenue to relating grants Other related conditionshave beenmet. performance- when account loss and profit the to released and income deferred as treated are grants performance whereby the model adopted has Group the 102, FRS Under Grants the leases. and loss account in equal annual amounts over of the periods in lease profit the the to charged are leases operating under costs Rental of period the over tothecapitalelementoutstanding. proportion allocated finance are The lives. charges useful estimated their over depreciated purchase hire and and acquisition on value fair their leases at capitalised are contracts finance under obtained Assets Leases Port ofMilford Haven &FinancialStatements2018 Annual Report 45

FINANCIAL STATEMENTS CORPORATE GOVERNANCE STRATEGIC REPORT 46 Port ofMilford Haven &FinancialStatements2018 Annual Report oa noe 0.9 Solar income Analysis ofturnover by classofbusiness isstatedbelow: 3. TURNOVER Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS Total netfinance 0.5 costs 0.4 Net interestondefined benefit pensionliability Interest payable and similar expenses 0.2 Interest payable andsimilarexpenses 7.7 Ship, passengerandgoodsdues .NTFNNECSS4. NETFINANCE COSTS is turnover tax. activitiesoftheGroupandaroseinUnitedKingdom. attributable totheprincipal All added value of net stated provided services and sold goods of amount invoiced the Turnover represents es neetrcial Less: interestreceivable 5.5 services Marine Pilotage services (note 8) 5.0 (note8) Pilotage services iclaeu noe 0.1 Miscellaneous income 2.9 Rents 22.1 2018 2017 2018 2017 2018 Group Port Group Port ’ £’m £’m £’m £’m

(0.1) 0.8 0.3 0.8 0.6 0.2 0.6 0.2 0.6 0.1 0.1 0.1 7.7 8.5 5.4 5.5 5.4 5.2 5.0 5.2 0.2 0.1 0.2 2.3 22.4 20.4 22.4 01 (0.1) (0.1) £m £’m £’m £’m £’m 2018 2017 2018 2017 2018 1.8 21.4 0.3 0.3 0.1 0.3 8.5 5.4 1.8 5.2 0.2 (0.1) 6. REMUNERATION OFKEYPERSONNEL rfto aeo ie ses - Profit onsaleoffixed assets 0.1 leasingcharges Hire andoperating The number of Directors to whom retirement benefits are accruing underdefined benefit towhomretirementbenefits schemesistwo areaccruing The number (2017: ofDirectors two). The average monthly number of Directors during theyear wasasfollows: during The average monthly number ofDirectors figurethe remuneration above at£183k(2017: £nil). yearforthe paid (2017: above.costs pension in included is and £29k) in officepaymentsincluded of Compensation forare loss was £24k of allowance pension a and Director this for accruing benefits retirement (2017:£nil).longer £nil no was are There MHPARBSthe under Director paid highest 2018 the of 31 December pension definedat benefitscheme pension accrued The ofthehighestpaidDirector Remuneration Senior Management Team Key personnel includes Executive and Non-Executive Directors and the Senior Management Team. (Loss)/profit on ordinary activitiesbefore taxationisstatedaftercharging/(crediting): (Loss)/profit onordinary 5. (LOSS)/PROFIT ON ORDINARY ACTIVITIES BEFORETAXATION Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS During the year the following services were obtainedfromtheGroup’s theyear thefollowingDuring auditor: services Cost ofstock (note18) amortisation Grant Depreciation oftangible assets(note10) 11.7 Staff costs(note7) eso ot xctv ietr Pension costs-Executive Directors 650 Aggregate emoluments(excludingdefined benefit -Executive pensioncontributions) Directors 134 Fees -Non-Executive Directors N. No. No. Group and Port 08 2017 2018 2017 2018 Group Port Group Port

’ £’m £’m 2018 £’000 £’000 £’000 10 £’000 £’000 £’000

u iiec naqiiino usday - Duediligenceonacquisitionofsubsidiary - Tax services advisory - Tax 13 complianceservices - 17 Audit ofpension schemes - Audit of Group accounts 49 - Audit ofGroup accounts

(0.4) 0.2 3.7 Port ofMilford Haven &FinancialStatements2018 Annual Report (0.1) (0.1) 1 - 0.2 0.1 0.2 03 0.3 3.5 3.7 1. 11.7 10.9 2018 2017 2018 13 13 2 - 25 1 17 16 16 51 51 (0.2) (0.4) (0.2) 2018 2017 2018 2017 2018 £m £’m £’m £’000 £’000 £’000 1,205 385 354 0.2 - 10 17 49 67 (0.1) 445 143 0.3 0.2 3.5 2017 10.9 1,080 9 25 17 16 51 10 61 251 431 (0.2) 47

FINANCIAL STATEMENTS CORPORATE GOVERNANCE STRATEGIC REPORT rvdn,mitiigadoeaigpltbas 1.6 Providing, pilotboats maintainingandoperating Providing services of a pilot ofapilot Providing services Expenditure 48 Port ofMilford Haven &FinancialStatements2018 Annual Report The average monthly number ofemployees, excludingNon-Executive Directors, theyear wasasfollows: during Pension costs. costsincludeonly thoseitemsincludedwithinoperating asdisclosedinnote 6.The above includesamountspaidtoDirectors prtoa tf staff Operational The revenueasfollows: andexpenditurerelatingtopilotagecanbesummarised 8. PILOTAGE Pension costs (note 19) 2.3 Pension costs(note19) 7. STAFF COSTS Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS Administration and other costs andothercosts Administration 0.2 Issue anduseofpilotageexemption certificates Office staff Providing pilotage services 4.8 Providing pilotageservices Turnover 0.9 costs Social security Wages andsalaries 6.5 5.0 ’ £’m £’m £’m £’m N. No. No.

Group and Port Group and Port 2018 185

2018 2017 2018 2017 2018 11.7 107 8.5 3.0 1.9 78 110 2017 2.3 0.9 7.7 2.7 1.6 1.9 5.2 0.2 6.2 5.0 10.9 71 181 duteti epc fpeiu er Adjustment inrespectofpreviousyears The Group is not aware of any factors that will materially affect the future tax charge. The Group is aware that the phased the that aware is Group charge. The tax taxto17%in2020hasbeenannouncedandenacted. ofcorporation future reduction intherate the affect materially will that factors any of aware not is Group The future taxcharges(c) Factors thatmayaffect Current taxcharge fortheyear Tax changes rate (0.1) Income nottaxable Expenses notdeductible (0.1) the applicable rate activitiesmultiplied by (Loss)/profit onordinary activitiesbefore tax (Loss)/profit onordinary comprehensive income Deferred taxperstatementof Tax perprofit loss and account (0.1) Total taxcredit deferred Total taxcharge current 9. TAX ON (LOSS)/PROFIT ON ORDINARY ACTIVITIES Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS The tax charge for the current and previous period differs from the applicable rate of corporation tax rate of 19.00% (2017: 19.00% of 19.25%). rate tax The differencescorporation areexplainedbelow: of rate applicable the from differs period previous and current the for charge tax The taxcharge fortheyear (b) Factors affecting charge fortheyear (a) Analysisof 08 2017 2018 2017 2018 Group Port Group Port ’ £’m £’m £’m £’m

0.6 0.4 0.4 (0.1) (0.6) 0.7 0.5 - Port ofMilford Haven &FinancialStatements2018 Annual Report (0.1) (0.1) 0.6 0.5 0.6 0.6 1.1 0.2 0.8 0.3 0.9 0.8 0.2 0.8 - (0.1) - 02 (0.1) (0.2) (0.1) (0.1) 05 (0.1) 0.5 (0.7) 2.6

2018 2017 2018 2017 2018 £m £’m £’m £’m £’m - (0.1) 0.5 1.1 0.8 0.9 0.8 - (0.1) (0.1) 0.5 2.6 49

FINANCIAL STATEMENTS CORPORATE GOVERNANCE STRATEGIC REPORT 50 Port ofMilford Haven &FinancialStatements2018 Annual Report Cost orvaluation Cost orvaluation t3 eebr21 78 39 11 63 70 - 66.1 - 17.0 16.3 1.1 3.9 27.8 At 31December2017 65.4 - 17.2 16.3 2.3 3.8 25.8 At 31December2018 Net bookvalue 25.2 2.0 11.6 - 0.4 0.8 10.4 At 31December2018 - - - 0.4 - - Impairment (0.6) - (0.6) - - - - Disposals 3.5 - 1.3 - - 0.2 2.0 for theyear Charge 21.9 2.0 10.9 - - 0.6 8.4 2018 At 1January Accumulated depreciation 90.6 2.0 28.8 16.3 2.7 4.6 36.2 At 31December2018 - - - (0.1) - 0.1 - Transfers 86.2 - 21.7 31.7 1.1 3.9 27.8 At 31December2017 84.3 - 21.7 30.7 2.3 3.8 25.8 At 31December2018 Net bookvalue 26.2 2.0 12.6 - 0.4 0.8 10.4 At 31December2018 0.4 - - - 0.4 - - Impairment (0.6) - (0.6) - - - - Disposals 3.7 - 1.5 - - 0.2 2.0 for theyear Charge 22.7 2.0 11.7 - - 0.6 8.4 2018 At 1January Accumulated depreciation 2.0 34.3 30.7 2.7 4.6 36.2 At 31December2018 (1.0) - - (1.0) - - - Revaluation - - - (0.1) - 0.1 - Transfers (0.6) - (0.6) - - - - Disposals 3.2 - 1.5 0.1 1.6 - - Additions 2.0 33.4 31.7 1.1 4.5 36.2 2018 At 1January 10. TANGIBLE FIXEDASSETS Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS ipsl - 06 - (0.6) - (0.6) - - - - Disposals 3.2 - 1.5 0.1 1.6 - - Additions 88.0 2.0 27.9 16.3 1.1 4.5 36.2 2018 At 1January ’ £m ’ £m £m £m £’m £’m £’m £’m £’m £’m £’m rpry property aieast ln n ot rpry eupet works equipment property costs landand assets marine

Port Group

pcaie reod eeomn Ivsmn Patad rdig Total Dredging Plantand Development Investment Freehold Specialised 0.4 110.5 108.9 MHPA PFP Limited Partnership arenotrequiredtobe,MHPAof andhave accounts not been, PFPLimitedPartnership the filed atCompaniesHouse. but House Companies with separately filed are Limited Partner) (General MHPAPFP for accounts Separate accounts. these to partnerships qualifying these of accounts the appended not therefore has and 2008 Partnerships Regulations (Accounts) the of 7 regulation by conferred exemption the of advantage taken has accounts. Group Group The these into The Group has an interest in a limited partnership registered in Scotland, MHPA PFP Limited Partnership, Glasgow,which is fully Scotland, inScotland. G21QQandwereconsolidated incorporated Square, House,George Lomond 9 at registered are MHPAand Partnership Limited Limited PFP MHPAPartner) (General PFP All oftheabove inEnglandand companieswere incorporated Wales. Pembrokeshire, SA733EP. Drive,Havens LimitedisregisteredatGorsewood Hakin, HeadRetailPark Milford Haven, MHPA RBS Trustee Drive, Company LimitedisregisteredatGorsewood Milford Haven, Pembrokeshire, SA733ER. Drive, LimitedisregisteredatGorsewood Milford Haven,Milford Haven Properties Pembrokeshire, SA733EP. Milford DocksCompany isregisteredat The OldSailLoft, Milford Docks, Milford Haven, Pembrokeshire, SA733AF. have andallofitssubsidiaries 31Decemberyear-ends.The Port 100% £1Ordinary RetailPark Havens Limited HeadRetailPark MHPA RBS 100% Trustee Pension Company £1Ordinary Limited Trustee Company 100% £1Ordinary Pension LimitedPartner MHPA PFPLimitedPartnership 100% £1Ordinary Pension FundPartner MHPA Limited Partner) PFP(General 100% £1Ordinary SolarPark Limited Milford Haven Properties 98.2% £1 Ordinary Dockoperator Milford DocksCompany Group investments 11. FIXEDASSETINVESTMENTS at fairvalueis£32.3m(2017: £32.2m). (2017:£30.7m to amounted Group the for£31.7m). held Group’sthe of investmentcost properties historical depreciated The and value letting value, market as occupancy terms, such which, bases for the of Port, amounted to £16.3m variety (2017: a £16.3m), using of value,which £1.0m is long leasehold fair (2017: of £1.0m), assessment and the confirmed 2018.valuation Their focusing desktop as valuation at of on and 31 all anymarkets December investment significant properties changes to properties a assets,Group’scompleted the of knowledge historical detailed with & Cushman Wakefield,valuers external qualifiedsuitably 10. TANGIBLE FIXEDASSETS(continued) Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS Subsidiaries Nature of business Class of share held Proportion ofnominalvalueheld Proportion Class ofshareheld Natureofbusiness Subsidiaries Port ofMilford Haven &FinancialStatements2018 Annual Report 51

FINANCIAL STATEMENTS CORPORATE GOVERNANCE STRATEGIC REPORT 12. STOCKS the acquisition date. since Limited Park Retail Head Havens of respect in account loss and profit Group the in included was £0.3m of profit a A full-year consolidation has been included in the Group for 2018. In the year ended 31 December 2017, turnover of £0.4m and Handelsbanken AB of£8.2m. The acquisitioncostsof£0.3mhave offtotheprofit andlossaccountoftheGroup. beenwritten Svenskawith sheet.loan balance a Port’s has the Limited in HavensPark Retail Head undertakings Group to due amount an as the shares of Havens Head Retail Park Limited, the Port borrowed £8.3m from Havens Head Retail Park Limited, which is shown £1.0m.of purchase consideration to £15.5m, order was deferred In and £0.3m of consideration costs cash acquisition including On 3 August 2017, the Group acquired 100% of the share capital of Havens Head Limited.Retail Park The fair value of the total mut u rmGopudraig - Amounts duefromGroupundertakings Amounts fallingdueaftermorethanoneyear: 52 Port ofMilford Haven &FinancialStatements2018 Annual Report Other debtors 0.9 Other debtors - taxasset(note17) Deferred Carrying valueat31December Carrying - Addition undertakings Subsidiary 11. FIXEDASSETINVESTMENTS(continued) Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS Deferred tax asset (note 17) taxasset(note17) Deferred 1.5 income Prepayments andaccrued 13. DEBTORS Stock offuelandparts rd etr 3.3 Trade debtors Amounts fallingduewithinoneyear: 21.4 Cost at1January ’ £’m £’m £’m £’m Group and Port 08 2017 2018 Group Port ’ £’m £’m Port

Restated 6.8 1.1 5.7 21.4 1.1 - - . - 1.5 0.8 0.9 0.8 1.6 1.6 1.6 7.0 6.9 7.0 5.7 7.0 3.1 3.2 3.1 2018 2017 2018 2017 2018 - 1.2 - - 1.1 - 2018 2017 2018

£m £’m £’m 0.3 0.1 15.5 1.4 0.2 5.9 - 21.4 0.9 1.5 6.9 0.1 6.8 0.1 3.0 Restated 14. CREDITORS: AMOUNTSFALLING DUEWITHINONE YEAR Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS eerdicm nt 8 - income(note 18) Deferred 0.2 income(note18) Deferred Deferred tax (note 17) 1.9 tax(note17) Deferred 8.0 - between two andfive years 0.1 - between oneandtwo years Bank loans: Other creditors - Amounts owed toGroupundertakings Trade 1.1 creditors 0.1 Bank loans 15. CREDITORS: AMOUNTSFALLING DUEAFTERMORETHANONE YEAR oilscrt n te aain 0.3 andothertaxation Social security 0.3 Pension contributions oprto a 0.2 tax Corporation cras 2.6 Accruals Other creditors eerdtxlaiiy(oe1) - taxliability(note17) Deferred 08 2017 2018 2017 2018 Group Port Group Port ’ £’m £’m £’m £’m 4.9 11.0 0.1 1.0 Port ofMilford Haven &FinancialStatements2018 Annual Report . - 1.8 - - 0.2 0.2 0.1 0.2 0.1 1.1 1.1 1.1 - 2.9 0.3 0.3 0.3 - 0.3 0.5 0.1 0.5 3.7 2.3 3.7 0.1 0.1 10.8 4.1 10.8 - 1.8 - . 19.6 9.4 8.1 8.1 0.1 1.0 1.0 2018 2017 2018 2017 2018 £m £’m £’m £’m £’m 16.8 - - - - 2.8 1.6 - - 0.2 - 9.8 0.1 1.1 0.3 0.5 3.4 - 1.0 18.2 17.0 53

FINANCIAL STATEMENTS CORPORATE GOVERNANCE STRATEGIC REPORT 54 Port ofMilford Haven &FinancialStatements2018 Annual Report Due aftermorethanoneyear 8.1 8.2 Bank loans 16. BORROWINGS Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS Total 8.2 8.2 Svenska (c) Handelsbanken AB acasBn L b - (b) Barclays BankPLC - (a) Clydesdale Note Due to: u ihnoeya 0.1 Due withinoneyear loanrepayments: bank Analysis of The bankloansincludedabove thefollowing: comprise sumsnotexceeding£50million.to borrow to the Milford HavenPursuant Port Harbour Revision Order Authority 2000, as at was 31 authorised December the 2018 Port Milford DocksCompany atthediscretionofDirectors. the by cancelled and purchased be can stock debenture 3.5% 1972, Docks the Act of Milford 3 The section with accordance a) The Clydesdale Bank loan above was repayable in monthly instalments at £0.3m per annum (including interest) and was fully was and interest) a) (including annum per £0.3m at aboverepayableinstalments monthlyloan was in Bank Clydesdale The b) The Barclays Bank PLC loan above was repayable in quarterly capital instalments of £0.1m plus interest payments variable in paymentsvariable interest plus £0.1m of instalments capital aboveloan repayablePLC Barclayswas Bank The quarterly in b) c) During the prior year, the Group acquired Havens Head Retail Park Limited and this company entered into a five-yeara bank into entered company this and Limited year, Park prior Retail the HavensHead acquired During Group the c) 08 2017 2018 2017 2018 Group Port Group Port ’ £’m £’m £’m £’m 8.2 8.2 A 3.5% debenture loan is secured on the undertakings of the Milford Docks Company and is not subject to repayment. In repayment. to subject not is and Company Docks Milford the of undertakings the on secured is loan debenture 3.5% A repaid in the year ended 31 December 2018. The loan was secured on the property known as Pembroke Port Gate 4 in 4 Gate PembrokePort as known property the on secured 2018.was December loan 31 The ended year the in repaid Pembroke Dock. Barclays, which expired with in facility Julycredit revolving 2018.million £10 a into During entered the also year, Port 2014,1.75%.the In of margin a the plus Port enteredrates LIBOR into with an line agreement with HSBC for a £20 million revolving repayable by quarterly capital payments at £0.1m per annum on £0.7m of the loan.to the is of £7.7m £0.7m of on element annuminterest-only per An £0.1m at payments capital repayablequarterly by loan agreement with Svenska Handelsbanken AB for a new loan of £8.4m. At the year-end, £8.2m remains outstanding and is credit facilityfor five years. atthebalancesheetdate above. This facilityisnotdrawn Under the Milford Docks Act 1981, the Milford Docks Company is empowered to raise finance by the creation and issue of issue and Docks Milfordcreation financethe bythe 1981,Under Act empoweredraise Companyis to Docks Milford the be repaidinfullafterfive years. share capital, of or the byundertaking, or loans byor mortgage the creation and issue of debenture stock, or wholly or partly under theseprovisions was £1.5m(2017: £1.5m). by one or more of those modes up to a maximum of £20 million. The amount byraised that company at 31 December 2018 25 - 2.5 - 0.3 82 - 8.2 29 - 2.9 1. - 11.1 - 11.1 1. - 11.1 1. - 11.1 . - 8.3 2018 2017 2018 2017 2018 £m £’m £’m £’m £’m 2.5 0.3 2.8 - - 2.8 2.8 2.8 2.8 the costs of the Port. The Port also received four grants from the Ports Development Fund, and a grant from the Rural the from grant a and Fund, Development Ports the from grants four totalling£0.2m. Development Programme received also Port Port. The the of costs the within included is which expenditure for Fund Communities Coastal from £0.1m of grant year,a the received During Port the - - ofwhichduetobereleasedafteroneyear 0.2 - ofwhichduetobereleasedinoneyear - - ofwhichduetobepayable inoneyear 1.9 capitalallowances Accelerated 17. DEFERREDTAXATION Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS 18. ACCRUALS ANDDEFERREDINCOME 1.9 - ofwhichduetobepayable afteroneyear At 31December Released toprofit andlossaccount (1.1) - ofwhichrecoverable afteroneyear - ofwhichduetoberecoverable inone year taxliability Deferred inrelationtoretirementbenefit taxarising Deferred 0.8 taxliabilityat31December Deferred 0.6 tostatementofcomprehensive income Charge (0.1) Credit toprofit andlossaccount 0.3 taxliability/(asset)restatedasat1January Deferred (0.2) adjustment period Prior diin Additions 0.3 At 1January Deferred grants: capital Deferred tax liability/(asset) as reported at 1 January 0.5 at1January taxliability/(asset)asreported Deferred ’ £’m £’m Group and Port 08 2017 2018 Group Port ’ £’m £’m

0.2 (1.1) 0.8 - Port ofMilford Haven &FinancialStatements2018 Annual Report 1.8 1.8 (1.5) - (1.5) - 1.8 - (.) 0.2 (0.7) (.) 0.4 (0.5) 1.8 0.3 1.1 0.3 2018 2017 2018 (0.1) (0.1) (0.1) (0.2) (0.2) (1.5) (1.1) (1.5) - (1.1) - 2018 2017 2018 £m £’m £’m (0.4) 1.8 0.7 0.6 0.7 0.3 - 0.2 (1.4) 1.6 0.1 0.3 0.5 - (0.8) (0.6) 1.6 0.2 1.1 0.2 - - (0.1) (0.2) (1.4) (0.2) 55

FINANCIAL STATEMENTS CORPORATE GOVERNANCE STRATEGIC REPORT 56 Port ofMilford Haven &FinancialStatements2018 Annual Report (d) In addition to the above schemes, some operational pilots are members of the Pilots’ National Pension Fund (PNPF). Fund Pension National Pilots’ the of members are pilots operational some schemes, above the to addition In (d) Milford Haven Port Retirement Authority Benefits Scheme (MHPARBS),(c) a defined benefit pension scheme providing benefits final on based benefits providing scheme benefit defined(MDCSBS), a PensionScheme Staff Company Docks Milford The (b) The Milford Docks Company Defined Scheme,Contribution a defined scheme contribution where the assets of the scheme (a) anumber ofschemesprovidingThe Groupoperates benefits for itsemployees asfollows: 19. EMPLOYEE BENEFITS Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS current 16-year deficitcurrent plan. the year, the Port paid deficit contributions of £0.5m (2017: £0.5m) and will continue to pay for the remaining 10 years of the invoicedare they bythe as made paymentsare and 102 FRS definedunder with benefitaccounting scheme Trustee.During PNPF.paymentsthe plan to authorities,recovery making is line in recognised and deficitcalculated the is of Port’s share The Contributions payable to the PNPF amounted to £0.1m (2017: £0.1m). The Port, in common with other competent harbour £nil) have toaNESTprovision untiladefined sectionofthepensionschemeisinoperation. beentransferred contribution (2017: £6k joiners.of new MHPARBS contributions employerfor within The section contribution defined a be to is There December 2019. 119% of the value of the liabilities of the scheme. The expects Port to contribute £1.0m to to amounted this scheme’s assets scheme the during the yearof to value 31 the that showed and 2018 January 1 at was valuation actuarial recent most The fund attheendofyear (2017: £nil). the to payable contributions (2017:outstanding £1.0m).£1.0m no werewas yearThere the for contribution pension The valuations. onthebasisoftriennial actuary spread the cost of pensions over the employees’ lives working with the Port. The byare contributions determined a qualified finalwereon 2009 based pensionable pay. to as so profitaccount the loss to and charged is scheme the of cost service The pay.pensionablefinal or 31 December to Earnings Career up Revalued providedAverageeither Benefits on based benefits for the Port’s staff. During 2009, the Port made the decision to change this scheme with effect from 1 2010 January to provide active no has members,it arepayable nocontributions tothefund. Since due. fall they as scheme the of liabilities the of value the of 141% to amounted assets scheme’s the wouldthe on based be PA90and tables.A67/70 mortality of rate the and RPI mortality showedvaluation that actuarial The by increase to assumed are 5% at capped RPI at payment in once increase annum,that per pensions 5% be would returns relating to the return on investment, the ratevaluation, those the wereof of increaseresults the on in effect significantsalaries most the and valuation,had the which actuarial ratethe in of assumptions mortality.The It was assumed that the investment pensionable pay for some of the Port’s full-time staff. The most recent valuation actuarial of this scheme was as at 1 July 2017. no members, active no has it arepayablecontributions tothisScheme. Since fund. administered independently an in Group the of those from separately held are The mortality assumptionsusedwere asfollows: The mortality n/a n/a 3.3% revaluation CARE pensions andinpayment Rate ofincreasefor deferred Rate ofincreaseinsalaries 2.9% 2.7% 2.9% for schemeliabilities Discount rate Inflation rate The mainassumptionsusedtocalculateschemeliabilitiesunderFRS102are: FRS102 Employee Benefits 19. EMPLOYEE BENEFITS(continued) Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS of theinvestment. the Port,investmentbyMHPARBS held the asset,scheme a represents basis. For accordingly,and cash value a current the deficitreflects pension position the on accounts Group these in contributions pension as reflected be MHPARBSwill to SLP from MHPARBS.by held SLP Distributions in investment the of value current the reflect not does statements financial Group these MHPARBS.in by presented held Accordingly, position and MHPARBS’sdeficit SLP by issued instruments financial transferable Group’sthe accounts.of consolidated purposes the for asset plan anynon- excluding assets plan definitionof the to due is This Under FRS 102, the investments held by MHPARBS in SLP, an entity included within the consolidated results, do not represent a SLP, MHPARBS isentitledtoanannual couponontheshareofprofits ofSLPeachyear in for 20years. partner a retains controlover andassuch, thispartnership, isfully consolidatedwithintheseGroupfinancial statements. As Group,the of Limited, £13.0m. of value a loan with wholly-ownedbyHaven Milforda subsidiary issued notes Properties hold to Group The Group the by established was partner.SLP limited a as (SLP) Partnership Limited MHPAPFP in £8.5m invested On 10 December 2013, the Group made a contribution to the MHPARBS of £8.5m. On the same day, the Trustee of Pensionthis FundingPartnershipscheme 25.0 - 22.4 25.0 Women - Men for futurepensioners: atage65 Longevity inyears 23.5 - 21.7 23.4 Women - Men pensioners: for current atage65 Longevity inyears

er er Years Years Years Years Years Years

MHPARBS MDCSBS PNPF MDCSBS MHPARBS PNPF MDCSBS MHPARBS 2.3% 2.4% 2.2% 2.4% 2.3% 3.2% 3.4% 3.3% 29 79 22.9 17.9 22.9 21.6 17.3 21.5 n/a n/a 3.2% n/a n/a 2018 2018 2017 2017 Port ofMilford Haven &FinancialStatements2018 Annual Report .% na n/a n/a 3.2% 25.1 22.4 25.1 25.1 22.4 23.1 23.1 17.9 23.6 23.6 21.7 21.7 21.7 17.3 2.6% 2.4% 2.4% 2.4% 2.6% 2.2% 2.3% 2.1% 2.3% 2.2% 3.1% 3.3% 3.2% n/a n/a 3.1% n/a n/a MHPARBS MDCSBS PNPF MDCSBS MHPARBS PNPF MDCSBS MHPARBS 57

FINANCIAL STATEMENTS CORPORATE GOVERNANCE STRATEGIC REPORT Other finance charges/(income) Other finance charges/(income) 58 Port ofMilford Haven &FinancialStatements2018 Annual Report prtn xess expenses - Operating costs Service prtn xess expenses - Operating costs service Current Administration costs - costs Administration - cost Past service - - Amounts recognisedintheprofit andlossaccountinrespectofthesedefined benefit schemesareasfollows: 19. EMPLOYEE BENEFITS(continued) Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS . - 0.4 - 2.6 income Recognised inothercomprehensive 0.4 - 2.1 Total - costs Administration - 0.4 - 2.7 income Total - netinterestcost atsriecs - cost Past service - Recognised inothercomprehensive

. - 0.3 - 2.0 2.0 - 0.3 - 2.0

. - 0.1 - 0.1 - netinterestcost Port Group

HAB DSS PNPF MDCSBS MHPARBS PNPF MDCSBS MHPARBS ’ ’ £’m £’m £’m £’m £’m £’m . - 0.1 - 2.0 . - 0.1 - 2.0 0.4 - 2.3 0.1 - 0.3 At 31December2018 At 31December2018 0.1 0.1 0.1 0.1 At31December2017 At31December2017 2.1 - 0.2 - 2.1 2.1 - 0.2 - 2.1 0.1 - 0.2 - 0.1 2.1 - 0.1 - 2.1 4.8 - 1.1 - 4.8 0.4 - 2.2 1.1 - 4.6 21 0.1 - 2.1 0.4 - 2.5 0.2 - 0.4 ’ ’ £’m £’m £’m £’m £’m £’m - - 0.1 ------0.1 - - - - - MHPARBS MDCSBS PNPF MHPARBS MDCSBS PNPF MHPARBS MDCSBS qiisEquities Equities e eso laiiy/se (.) 02 (4.5) 0.2 (1.0) Net pension(liability)/asset 1.0 - 0.2 tax Related deferred (5.5) 0.2 (1.2) Pension (liability)/asset Present valueofschemeliabilities 10.5 4.2 51.9 Total value ofassets market - - 8.4 Investment inSLP Property Annuity contracts 4.8 0.1 29.7 0.8 - 0.7 Cash 4.9 0.6 6.4 Bonds (4.5) 0.2 (9.4) Net pension(liability)/asset 1.0 - 0.2 tax Related deferred (6.1) (11.6) 0.2 (5.5) 0.2 (9.6) Pension (liability)/asset Present valueofschemeliabilities 10.5 4.2 43.5 Total valueofassets market Property - 3.5 0.1 Annuity contracts 4.8 0.1 29.7 Cash 4.9 0.6 6.4 Bonds The analysis oftheassetsinschemeswas: 19. EMPLOYEE BENEFITS(continued) Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS Restated Restated

Port Group

HAB DSS PNPF MDCSBS MHPARBS PNPF MDCSBS MHPARBS 5.) (.) (16.0) (4.0) (53.1) (16.0) (4.0) (53.1) ’ ’ £’m £’m £’m £’m £’m £’m 6.6 - - - 6.6 - 3.5 0.1 - - 6.6 0.8 - 0.7 At 31December2018 At 31December2018 Port ofMilford Haven &FinancialStatements2018 Annual Report 89 - - 8.9 - - 6.4 - 3.7 0.1 - - 6.4 - 3.7 0.1 At31December2017 At31December2017 0.4 - 1.0 - 0.4 0.2 - 0.4 5.5 0.6 6.6 1.0 - 0.4 5.5 0.6 6.6 0.4 - 0.2 - 0.4 06 01 5.7 0.1 30.6 5.7 0.1 30.6 ’ ’ £’m £’m £’m £’m £’m £’m 5. . 11.4 4.4 53.0 11.4 4.4 44.1 (.) 02 (5.1) 0.2 (2.3) (12 02 (5.1) (11.2) 0.2 (57 (.) (17.5) (4.2) (55.7) HAB MCB PNPF MHPARBS MDCSBS PNPF MHPARBS MDCSBS (55.7) (4.2) (17.5) (4.2) (55.7) 27 . (6.1) 0.2 (2.7) 59

FINANCIAL STATEMENTS CORPORATE GOVERNANCE STRATEGIC REPORT xesspi Expenses paid 0.1 - 0.3 Members’ contribution (1.1) (0.2) (1.6) Benefits paid (0.6) (0.1) (2.1) gains/(losses) Actuarial 0.2 0.1 1.3 Interest income 60 Port ofMilford Haven &FinancialStatements2018 Annual Report At 1 January At 1January At 1 January At 1January . 0.6 - paidby 1.5 Contributions employer Movement inthefairvalueofschemeassetswas: 19. EMPLOYEE BENEFITS(continued) Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS 08 / (0.3) n/a (0.8) onplanassets Actual return 10.5 4.2 51.9 At 31December 0.6 - paidby 1.0 Contributions employer Expenses paid 0.1 - 0.3 Members’ contribution Benefits paid (0.6) (0.1) (2.2) gains/(losses) Actuarial 0.2 0.1 1.4 Interest income (0.3) n/a (0.9) onplan assets Actual return At 31December

Port Group

.

53.0 4.4 11.4 4.4 53.0 35 42 10.5 4.2 43.5 HAB DSS PNPF MDCSBS MHPARBS PNPF MDCSBS MHPARBS 41 44 11.4 4.4 44.1 20 (.) (1.1) (0.2) (2.0) (1.1) (0.2) (1.6) ’ ’ £’m £’m £’m £’m £’m £’m - - - - At 31December2018 At 31December2018 (0.1) (0.1) At31December2017 At31December2017 0.2 - 0.1 - 0.2 0.2 0.1 1.2 1.5 - 0.6 - 1.5 1.0 - 0.6 - 1.0 0.1 - 0.3 0.2 0.1 1.3 ’ ’ £’m £’m £’m £’m £’m £’m 4. 46 11.2 4.6 41.1 53.0 4.4 11.4 4.4 53.0 11.2 4.6 50.1 11.4 4.4 44.1 (0.1) - - - - (0.1) - - (2.0) (0.2) (1.1) (0.2) (2.0) 2.1 (0.1) 0.5 (0.1) 2.1 3.7 n/a 0.7 n/a 3.7 0.5 (0.1) 2.3 0.7 n/a 3.3 MHPARBS MDCSBS PNPF MHPARBS MDCSBS PNPF MHPARBS MDCSBS eie eei biain Defined benefit obligations t1JnayAt 1January h ttmn fcmrhnieicm the statementofcomprehensive income Total gainsandlossesrecognisedin actuarial (6.5) Net liabilityrecognisedinbalancesheet Plan assets the statementofcomprehensive income Net liabilityrecognisedinbalancesheet Plan assets Amounts forcurrent previous year and four years asrestated forMHPARBS, PNPF: MDCSBSand equivalentis£5.1m(2017:The Port £8.1m). The cumulative amount of actuarial losses recognised in the Group statement of comprehensive income is £6.3m (2017: £9.4m). lossesActuarial and gains At 31December (1.0) (0.1) (4.8) (gain)/loss Actuarial Benefits paid 0.4 0.1 1.5 0.4 0.1 1.4 Interest cost Members’ contribution 0.1 - 2.0 cost Service Reconciliation ofpresentvalueschemeliabilities: 19. EMPLOYEE BENEFITS(continued) Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS Defined benefit obligations Total gainsandlossesrecognisedin actuarial

Restated

’ ’ ’ £’m £’m £’m £’m £’m

Port Group Group Port and

57 42 17.5 4.2 55.7

31 40 16.0 4.0 53.1 . 0.1 - 0.3

HAB DSS PNPF MDCSBS MHPARBS (1.5) (0.2) (1.1) (0.2) (1.5) ’ ’ £’m £’m £’m 2017 2016 2015 2014 2015 2016 2017 2018 (73.1) 66.6 58.2 At 31December2018 (73.1) 1.) 2.) 1.) (15.3) (12.3) (22.4) (17.5) (14.9) 3.0 3.1 5.7 (10.2) 3.0 1.0 (10.2) 3.0 5.7 59 (.) 25 1.4 2.5 (9.1) 5.9 68.8 65.9 59.3 58.6 59.3 65.9 68.8 49.7 51.2 56.9 59.9 86 1.) (.) (6.4) (4.2) (13.4) (8.6) 7.) 7.) 6.) (65.0) (63.5) (79.3) (77.4) 7.) 7.) 6.) (65.0) (63.5) (79.3) (77.4) Port ofMilford Haven &FinancialStatements2018 Annual Report At31December2017 2.1 - 0.2 - 2.1 0.3 - 0.1 - 0.3 56.3 4.4 18.5 4.4 56.3 55.7 4.2 17.5 4.2 55.7 ’ ’ £’m £’m £’m 20 (.) (1.1) (0.2) (2.0) 25 (.) (0.6) (0.1) (2.5) HAB MCB PNPF MHPARBS MDCSBS 61

FINANCIAL STATEMENTS CORPORATE GOVERNANCE STRATEGIC REPORT 62 Port ofMilford Haven &FinancialStatements2018 Annual Report Difference between pension charge and cash contributions (note 19) (note19) Difference andcashcontributions between pensioncharge (1.0) (Decrease)/increase increditors (0.3) Increase indebtors Increase instocks cashflow before movementOperating capital inworking released) 3.3 (netofgrants Depreciation charges 21. RECONCILIATION OFOPERATING PROFITTO CASHGENERATED BYOPERATIONS intheyear. transactions There arenorelatedparty 20. TRANSACTIONS WITHRELATED PARTIES Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS - afterfive years Total futureaggregateminimum rentalsreceivable leasesareasfollows: undernon-cancellable operating 23. OPERATING LEASES 0.3 for but notprovidedContracted inthefinancial statements 22. CAPITAL COMMITMENTS Cash generated by operations Tax paid ewe n n ieyas 5.1 - between oneandfive years 2.0 - withinoneyear Gain onsaleoffixed assets offixed Impairment assets 0.4 0.9 profit Operating amounted to £25.1m (2017: £26.1m). Asdate, balancesheetdepreciatedand, property,Groupthereplacement otherrevaluations thecost atexplained of equipment in and plant in (ii),of excess any (ii) and itinvestmentproperties for cost includes historicdepreciatedover value fair of excess historical(i) anyrecords reserve This valuations of specialised marine assets up to 31 DecemberRevaluation Reserve 24. RESERVES This recordscumulative profit andloss. Profit loss and account 2015 when deemed cost at the last formal valuation at 31 December 2013 was adopted and will remain an unrealised reserve. ’ £’m £’m £’m £’m 08 2017 2018 Group Port ’ £’m £’m 8.7

2.5

1.6 2.2 6.5 2.1 10.8 2018 2017 2018 2017 2018 0.7 2018 2017 2018 £m £’m £’m (0.1) (0.8) 2.0 1.0 3.7 0.1 4.6 - (0.1) 1.1 2.7 1.0 4.8 - 0.3 6.4 3.5 0.1 7.6 3.0 (1.0) (0.7) - 2.6

(for openingliabilitiesand pensiondeficit). The correction has also been made to Note 17 Deferred tax (for opening deferred tax position) and Note 19 Employee benefits Opening balance restated Opening balancerestated 45.5 (1.1) Restated amount Opening balance previously stated 24 46.6 24 Opening balancepreviously stated at1January Profit andlossaccountreserve Balance Sheetextract: The tables below show the2017financial statementsandtherestatedamounts: (2017)andrestatedamountsshown inthefinancial period statementsandallrelatednotes. prior the of liabilities account.and loss assets reserves,However,and opening profit the 2017 to and made been has adjustment the It is not practicable to quantify the amount of the forcorrection each and period prior therefore there is no impact on the 2018 year adjustment,as aprior taxassetof£0.2m. togetherwithanassociateddeferred these defects valued between £0.7m and £1.3m. The Directors have used a best estimate of potential additional liability 2018,effectiveDecember an 31 of with of date 2016, December 31 and £1.3m2017 December 31 addressing of impact the quantifying recognised.be to needing liability pension additional an in resulted has this have Port’sThe actuaries costings provided actuarial and 2010 January 1 at as Career a to (CARE) AverageEarnings Revalued Salary benefitFinal the from when changed was basis MHPAthe RBS of amendment Trustthe Deed to relating advice legal followingidentified been has adjustment period prior A 27. PRIORYEARADJUSTMENT possibility ofany reimbursement. the and effects,financialtiming estimated their the to relation in disclosures additional any make to impracticable currently is It financial statements. these in included been has claims necessary.these Consequently,is for provision provision no no received,that believeadvice The Group is dealing with a small number of legal claims. The haveDirectors reviewed all of these claims and, on the basis of legal 26. CONTINGENT LIABILITY 31December and At 1January 5 IOIYITRS 25. MINORITYINTEREST Year ended31December2018 NOTES TO THEFINANCIAL STATEMENTS Statement ofChangesinEquityextract: 48.3 47.2 46.6 45.5 24 Profit andlossaccount (7.3) (8.6) (16.2) (17.5) 19 Pension liability 6.6 6.8 6.8 7.0 13 -duewithinoneyear Debtors £’m 08 2017 2018 Group Port Group Port ettd Restated Restated

Note £’m £’m £’m £’m £’m £’m £’m Note 2017 2017 2017 2017 2017 2017 2017

Group

Note £’m £’m £’m Port ofMilford Haven &FinancialStatements2018 Annual Report 96 47.2 39.6 07 48.3 40.7 2018 (1.1) (1.1) (1.1) ’ £’m £’m 2018 2017 2018 41.1 42.2 (1.1) 0.1 63

FINANCIAL STATEMENTS CORPORATE GOVERNANCE STRATEGIC REPORT Port of Milford Haven Annual Report & Financial Statements 2018

NOTES TO THE FINANCIAL STATEMENTS The Port of Milford Haven’s businesses Year ended 31 December 2018

28. POST BALANCE SHEET EVENT Following the UK referendum on 23 June 2016 and subsequent decision to leave the EU, the Port has kept abreast of Brexit developments. The Port’s exposure to Brexit-related risk is limited. There are very few transactions with EU-based customers and Northside suppliers and the degree to which any general economic downturn might impact demand for Port services, while still unclear, has Headquarters been assessed as minimal. FX exposure is negligible and there are no foreseen going concern issues arising from Brexit. Marine Operations Pilotage Conservancy VTS Navigation simulator Water Ranger Milford Marina Leisure boat berthing Boat storage Milford Fish Docks Fish landings Fish processing Aquaculture Milford Waterfront Retail, leisure and tourism development Havens Head Retail Park Quayside Properties Retail, leisure, office, light industrial Cruise Southside Pembroke Port Breakbulk, dry bulk and project cargo handling Marine renewables development and fabrication hub Layover service hub Laydown and storage Pembroke Dock Ferry Terminal Passengers and cars Accompanied and unaccompanied freight Quayside Properties Heavy industrial, light industrial, warehousing, office

Gorsewood Drive, Milford Haven, Pembrokeshire SA73 3EP Tel: +44 (0)1646 696100 | [email protected] | www.mhpa.co.uk

Milford Waterfront Milford Marina Milford Fish Docks Pembroke Port Quayside Properties Milford Haven Cleddau House, Milford Haven Cleddau House, Milford Haven Port Office, The Dockyard Suite 5, Cedar Court Pembrokeshire SA73 3AF Pembrokeshire SA73 3AF Pembrokeshire SA73 3AF Pembroke Dock Milford Haven Tel: +44 (0)1646 696360 Tel: +44 (0)1646 696312 Tel: +44 (0)1646 696300 Pembrokeshire SA72 6TD Pembrokeshire SA73 3LS [email protected] [email protected] [email protected] Tel: +44 (0)1646 696631 Tel: +44 (0)1646 696380 www.milfordwaterfront.co.uk www.milfordmarina.com www.milfordfishdocks.com [email protected] [email protected] 64 www.pembrokeport.com www.quayside.properties 1958 to 2018 - 60 years of port operations

k Break, dry and project cargoes k are all handled at Pembroke Port The acquisition of Havens Head Retail Park is contributing to the Port’s k HRH Princess Marina, Duchess of Kent, diversification strategy opens the Port’s new headquarters

m The Port welcomes the British Admiral

The B&I Line’s MV m The £6m lock gates have delivered enhanced Connacht arrived accessibility to Milford Marina and Milford Fish Docks Milford Haven First 100,000-ton The Port receives 59m tonnes of cargo at the Port’s new Conservancy Board vessel, the British the Esso Scotia, the passes through the £8m terminal on Irish Ferries starts Pembroke Port was created by an Annual tonnage Admiral, arrives at first 250,000-ton Port making it her inaugural sail running the Gate 1 was acquired RWE Pembroke Act of Parliament on entering Milford the Port on her vessel ever to call at Britain’s largest port from Cork on Pembroke to and expands cargo Pembroke Port Power Station New lock gates Havens Head Retail the 30th April 1958 Haven passes 10m maiden voyage a British port in terms of tonnage 23rd May 1979 Rosslare service handling capacity Gate 4 was acquired begins generating installed Park acquired 1958 1962 1965 1969 1974 1979 1992 1998 2008 2012 2015 2017

1960 1964 1968 1973 1977 1991 1996 2004 2009 2014 2016 2018 Esso Refinery was Texaco (Pembroke) Gulf Refinery comes Amoco Refinery Land acquired for Milford Marina opens Oil tanker ‘Sea A candidate site since ‘Tembek’ is the first Liddeston Ridge solar Marine simulator opened by HRH Refinery comes on-stream comes on-stream Pembroke Dock Empress’ runs aground 1997, the Milford Liquefied Natural array is completed suite opened Duke of Edinburgh on-stream Ferry Terminal at the entrance to Haven Waterway Gas carrier to enter the Haven. This becomes an official the Port tragedy was a Special Area of watershed moment Conservation for the shipping and (Pembrokeshire port industries Marine SAC) resulting in UK-wide changes to port operations and an international impact on the way these vessels are designed

m Since opening in 1991, Milford Marina has welcomed guests from around the world all keen to explore the incredible Pembrokeshire coast and Waterway m With a 315m length overall and 50m beam, the Tembek was the largest vessel to call at the Port at this point m The Navigation Simulator was an important investment in safe Waterway operations

66 67 Published by the Port of Milford Haven and produced in Pembrokeshire with the dedicated assistance of our staff.

Photography: Owen Howells, Derek Phillips Photography Design: rockpooldesign.co.uk Print: Forrest Print This publication is printed on paper from sustainable forests using vegetable based inks