INFORMATION FOR DISCLOSURE
PURSUANT TO SECTION 57T OF THE COMMERCE ACT 1986
Westpower Limited
146 Tainui Street
GREYMOUTH
In accordance with the Electricity (Information Disclosure) Requirements 2004.
Certification of Financial Statements, Performance Measures, and Statistics Disclosed by Line Owners Other Than Transpower for the year ended 31 March 2006.
We, Suzanne Peta Merriman and Hugh Robert Little, Directors of Westpower Limited, certify that, having made all reasonable enquiry, to the best of our knowledge,-
(a) The attached audited financial statements of Westpower Limited, prepared for the purposes of requirement 6 of the Commerce Commission's Electricity Information Disclosure Requirements 2004 comply with those requirements; and
(b) The attached information, being the derivation table, financial performance measures, efficiency performance measures, energy delivery efficiency performance measures, statistics, and reliability performance measures in relation to Westpower Limited, and having been prepared for the purposes of regulations 14, 15, 20, and 21 of the Electricity Information Disclosure Requirements 2004, comply with the requirements of those Requirements.
The valuations on which those financial performance measures are based are as at 31 March 2006.
________________________ ________________________
Suzanne Peta Merriman Hugh Robert Little
Director Director
Date : 17 November 2006
FORM 7
STATUTORY DECLARATION IN RESPECT OF STATEMENTS AND INFORMATION SUPPLIED TO COMMERCE COMMISSION
I, Suzanne Peta Merriman, of Greymouth, being a director of Westpower Limited, solemnly and sincerely declare that having made all reasonable enquiry, to the best of my knowledge, the information attached to this declaration is a true copy of information made available to the public by Westpower Limited under the Commerce Commission's Electricity Information Disclosure Requirements 2004.
And I make this solemn declaration conscientiously believing the same to be true and by virtue of the Oaths and Declarations Act 1957.
S P Merriman
Director
Declared at Greymouth this 17th day of November 2006
Signed in the Presence of:
Neil Alan Ellery
(Name) (Signature)
Just of the Peace
(Title)
Being a Justice of Peace or Solicitor (or other person authorised to take a statutory declaration).
WESTPOWER LIMITED
STATEMENT OF ACCOUNTING POLICIES
For The Year Ended 31 March 2006
The financial statements presented are for the reporting entity Westpower Limited. Westpower Limited is a Lines Company registered under the Companies Act 1993.
The financial statements have been prepared in accordance with the requirements of the Electricity (Information Disclosure) Requirements 2004.
The measurement base adopted is that of historical cost except for the revaluation of certain fixed assets.
(a) Sales
Sales shown in the Statement of Financial Performance comprise the amounts received and receivable by the Group for goods and services supplied to customers in the ordinary course of business.
Lines Charges represent income charged to Energy Retailers based on their meter readings during the period. An allowance is made for unbilled Lines Charges from Energy Retailers to the end of the period.
(b) Investments
The parent company's investment in ElectroNet Services Limited is stated at cost.
Sinking Fund Investments are shown at cost plus accumulated interest.
Other Investments are stated at cost.
Dividend income is accounted for on a cash basis. Interest income is accounted for as earned.
(c) Fixed Assets and Depreciation
(i) Valuation
Fixed Assets comprise:
Distribution System Assets (being the network system consisting of distribution and transmission lines and cables, zone substations, distribution transformers, protection and control equipment, communications equipment and metering).
Other Assets (being land, buildings, plant and equipment, motor vehicles, furniture and fittings).
Distribution System Assets were revalued to Depreciated Replacement Cost which incorporates a valuation based on the engineering optimisation of the system and its components after allowing for depreciation. The valuation was conducted by KPMG in conjunction with Kerslake and Partners, Registered Valuers, as at 31 March 2004.
Land and Buildings were revalued to market value as at 31 March 2004. The valuation was conducted by Coast Valuations Limited, registered valuers.
All other fixed assets are valued at cost less accumulated depreciation where applicable.
Distribution equipment is revalued on a cyclical basis with no individual asset being included at a valuation made more than three years previously.
Additions between revaluations are recorded at cost.
(ii) Depreciation
Distribution Assets are depreciated using the straight line method at rates which amortise the cost or valuation less estimated residual value over their economic lives.
The main basis are periods not exceeding:
Electricity Distribution System 15 - 70 years
Other Assets are depreciated using rates which write off the cost or valuation of the fixed assets over their expected economic lives as below:
Buildings 1% to 2.5% SL
Motor Vehicles 20% to 25% DV
Plant and equipment 10% to 50% DV
Furniture and fittings
including computers 20% to 48% DV
Profits and losses on disposal are calculated as the difference between the carrying amount of the asset at the time of disposal and the proceeds of the disposal. Any depreciation recovered and any loss on sale is included in the operating result of the Group in the year of the disposal.
(d) Inventories
Stocks and work-in-progress are stated at the lower of cost and net realisable value.
The cost of stocks is determined on a weighted average basis.
Some stocks may be subject to retention of title clauses on purchase.
The cost of work-in-progress includes materials, and a portion of direct labour and production overhead appropriate to the stage of completion attained.
(e) Debtors
Debtors are stated at estimated realisable value after providing for debts where collection is doubtful.
(f) Taxation
The taxation charge against the profit for the year is the estimated liability in respect of that profit and is calculated after allowance for permanent differences and timing differences not expected to reverse in future periods. This is the partial basis for the calculation of deferred taxation.
The Company follows the liability method of accounting for deferred taxation. Future taxation benefits attributable to losses carried forward or timing differences are recognised in the financial statements only where there is virtual certainty of realisation.
(g) Goods and Services Tax
All items in the financial statements are net of Goods and Services Tax except for Debtors and Creditors which are shown in the Statement of Financial Position inclusive of GST.
(h) Financial Instruments
Westpower and its subsidiaries are party to financial instrument arrangements as part of everyday operations. These instruments include bank accounts, debtors, creditors, borrowings and interest rate swaps.
Revenues and expenses in relation to all financial instruments are recognised in the Statement of Financial Performance.
Unrealised revenue and expenses associated with electricity hedges are not recognised in the financial statements. Realised revenue and expenses are recognised in the Statement of Financial Performance on maturity of the hedging contracts and are incorporated as part of the cost of electricity.
All financial instruments are recognised in the Statement of Financial Position, with the exceptions of contingent liabilities and interest rate swaps which are disclosed by way of a note to the financial statements.
(i) Changes in Accounting Policies
There have been no changes in accounting policies. All other policies have been applied on a basis consistent with the previous year.
WESTPOWER LIMITED - LINES BUSINESS
STATEMENT OF FINANCIAL PERFORMANCE
FOR THE YEAR ENDED 31 MARCH 2006
Note 2006 2005
$000's $000's
Revenue 1 14,130 13,729
Total Expenses 2 9,321 9,277
Net Surplus before Interest and Tax 4,809 4,452
Interest 612 257
Net Surplus before Income Tax 4,197 4,195
Less Taxation Expense 3 927 1,223
NET SURPLUS AFTER TAX 3,270 2,972
STATEMENT OF MOVEMENTS IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2006
Equity as at 1 April 2005 63,484 60,668
Net Surplus for Year 3,270 2,972
Revaluation of Assets - -
Total Recognised Revenue and Expenses 3,270 2,972
Dividend Paid (156) (156)
Equity as at 31 March 2006 66,598 63,484
The accompanying notes and policies form part of these financial statements
WESTPOWER LIMITED - LINES BUSINESS
STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2006
Note 2006 2005
$000's $000's
EQUITY
Share Capital 30,300 30,300
Reserves 22,381 22,381
Retained Earnings 13,917 10,803
TOTAL EQUITY 7 66,598 63,484
Represented By:
CURRENT ASSETS
Cash and Bank 714 167
Sundry Debtors 4 1,817 1,740
Tax refund due 338 87
Other Current Assets - -
2,869 1,994
NON CURRENT ASSETS
Fixed Assets 5 76,216 67,823
Investments 1,280 1,244
77,496 69,067
TOTAL ASSETS 80,365 71,061
CURRENT LIABILITIES
Sundry Creditors 2,108 2,879
Accrued Interest 185 46
Provision for dividend - -
2,293 2,925
NON CURRENT LIABILITIES
Employee Entitlements - -
Long - term Debt 6 11,474 4,652
11,474 4,652
TOTAL LIABILITIES 13,767 7,577
NET ASSETS 66,598 63,484
The accompanying notes and policies form part of these financial statements
WESTPOWER LIMITED - LINES BUSINESS
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2006
Note 2006 2005
$000's $000's
CASH FLOWS FROM OPERATING ACTIVITIES
Cash was provided from:
Receipts from customers 12,956 12,744
Interest received 43 53
Dividend Received 9 12
13,008 12,809
Cash was applied to:
Payments to suppliers & employees 6,079 7,455
Interest paid 473 225
Taxes paid 1,178 1,001
Net GST 103 (128)
7,833 8,553
Net cash flows from operating activities 11 5,175 4,256
CASH FLOWS FROM INVESTING ACTIVITIES
Cash was provided from:
Proceeds from sale of assets 29 -
Loan payment received - -
29
Cash was applied to:
Purchase of fixed assets 11,365 6,013
Purchase of investments 36 32
11,401 6,045
Net cash flows from investing activities (11,372) (6,045)
CASH FLOWS FROM FINANCING ACTIVITIES
Cash was provided from:
Term Loan 11,250 2,150
Contributions from Owners - -
11,250 2,150
Cash was applied to:
Repayment of Term Loan 4,428 400
Dividends paid 78 156
4,506 556
Net cash flows from financing activities 6,744 1,594
Net increase (decrease) in cash held 547 (195)
Add opening cash brought forward 167 362
Transfer of Cash from "Other Business"
Ending cash carried forward 714 167
CASH BALANCES IN THE STATEMENT OF
FINANCIAL POSITION
Cash and Bank 714 167
The accompanying notes and policies form part of these financial statements
WESTPOWER LIMITED - LINES BUSINESS
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2006
2006 2005
$000's $000's
Note 1. Revenue
Line Charges 12,643 12,263
Special Discount on Line Charges (981) 0
Interest 43 53
AC loss-rental rebates 321 174
Sundry Income 2,104 1,239
14,130 13,729
Note 2. Expenses
Audit fees for Companies financial statements 38 40
Other services provided by Auditors
Directors' Fees 51 58
Depreciation 2,117 1,953
Loan Interest 612 257
Bad debts written off
Increase (decrease) in estimated doubtful debts
Loss (Profit) on Sale of Fixed Assets 323 552
Write Down in Valuation of Buildings and Land
Note 3. Taxation
Net Surplus before taxation 4,197 4,195
Prima facie taxation at 33% 1,385 1,384
Plus Tax effect of permanent differences
Imputation Credits (5) (6)
Taxation adjustment previous year 0 105
Tax effect of Permanent Differences and Timing differences not Recognised (453) (260)
Total Taxation Expense 927 1,223
The Taxation charge comprises
- current taxation 927 1,118
- prior period adjustments 105
927 1,223
The company has not recognised a deferred taxation liability of $8,700,000 (2005 $7,749,000)
2006 2005
$000's $000's
Note 4. Sundry Debtors
Line Charge & Sundry Debtors 1,817 1,740
1,817 1,740
Note 5. Fixed Assets
Cost/ Accumulated Book Value Book Value
Valuation Depreciation 2006 2005
$000's $000's $000's $000's
At Cost:
Distribution System 17,620 186 17,434 8,482
Land and Buildings 1,537 6 1,531 104
Other 736 202 534 275
Capital Work In Progress
19,893 394 19,499 8,861
At Valuation:
Distribution System 58,911 3,734 55,177 57,340
Land and Buildings 1,599 59 1,540 1,622
Total 80,403 4,187 76,216 67,823
The fair value of land and buildings is equilivant to the net book value as at 31 March 2006. Carrying value is considered an accurate reflection of fair value.
Note 6. Borrowings
2006 2005
$000's $000's
Term Liabilities - Repayable 1-2 years 11,072 4,250
- Repayable 2-5 years 402 402
- Repayable later than 5 years 0 0
11,474 4,652
Loans are secured as follows:
Short Term Advance Facility $15,000,000 * 11,072 4,250
Various (No Security) 402 402
11,474 4,652
* The National Bank Short Term Advance facility is due to roll over for one year on 31 July 2006. The roll over of this facility is at the discretion of the bank. The Company expects that this loan will be rolled over for at least another year.
The interest rates payable on these loans are:
Floating Rate - based on 90 day bill rate
Fixed Rates 7.14% - 10.5%
2006 2005
$000's $000's
Note 7. Share Capital
Share Capital (issued and fully paid)
- 25,000,000 ordinary shares 25,000 25,000
- 300,000 7.25% Redeemable Preference Shares 300 300
- 5,000,000 Preference Shares 5,000 5,000
Capital Reserve 102 102
Transition Reserve 418 418
Asset Revaluation Reserve 21,861 21,861
Retained Earnings 13,917 10,803
66,598 63,484
Note 8. Financial Instruments
Credit Risk
Financial instruments which potentially subject the Company to credit risk principally
consist of bank accounts, accounts receivable and investments.
The Company places its cash with high quality financial institutions and limits the amount of exposure
to any one financial institution. There is a high concentration of credit risk to Trustpower.
The maximum exposure to credit risk at balance date is the fair value of the instruments as
stated in the Statement of Financial Position.
Fair Values
For all financial instruments other than the interest rate swaps and the shareholding in
International Panel and Lumber (West Coast) Limited the fair value is equivalent to the
carrying amount as stated in the Statement of Financial Position. Borrowings are planned
to be run to maturity. The fair value of the interest rate swaps at 31 March 2006
is $0 (2005 $0).
The fair value of the shares in International Panel and Lumber (West Coast) Limited is $95,400
(2005 $95,400). This represents the value of the 30,000 shares based on the value of net assets
as at 31 January 2005.
Currency Risk
The Company has minimal currency risk given that financial instruments are principally transacted in
New Zealand dollars. Forward exchange contracts may be employed by the Company to manage
exposure to currency fluctuations.
Interest Rate Risk
Interest rate risk is low as borrowings have fixed interest rates except for the Short Term
Advance Facility for $15,000,000 (2005 $7,000,000) .
The contract amount of interest rates swaps held at 31 March 2006 is $0 (2005 $0).
Note 9. Contingent Liabilities and Capital Commitments
Capital Commitments
2006 2005
$000's $000's
The total amount committed at balance date was 2,670 555
Operating Lease Commitments
These are long-term operating leases relating to land occupied by the Company.
Period 2006 2005
$000's $000's
Not later than 1 year 21 21
1 - 2 years 21 21
2 - 5 years 63 63
Later than 5 years 0 21
105 126
Contingent Liabilities
There are no contingent liabilities at 31 March 2006
Note 10. Related Parties
At balance date the West Coast Electric Power Trust held 100 per cent of the
shares in Westpower Limited.
All related party transactions of Westpower Limited have been conducted
on a commercial arms length basis.
The Contracting and Management Subsidiary of Westpower Limited, ElectroNet Services,
has provided the following services for the period 1 April 2005 to 31 March 2006.
2006 2005
$000's $000's
Construction of subtransmission assets 1,670 1,810
Construction of zone substations 5,231 2,460
Construction of distribution lines and cables 835 1,478
Construction of medium voltage switchgear 509 726
Construction of distribution transformers 354 462
Construction of substations 83 162
Construction of low voltage lines and cables 283 223
Construction of other fixed assets 970 434
Maintenance of assets 2,517 2,493
Consumer connections and reconnections
Asset Management Service 588 543
Other Services 398 791
Services provided to ElectroNet Services Ltd 75 122
Amounts receivable from ElectroNet Services Ltd 7 0
At year end there was an outstanding balance of $1,484,923 (2005 $2,510,813) for such services.
No related party debts have been written off or forgiven during the year.
Other Related Parties
West Coast Electric Power Trust
The Trust holds 100% of the shares in Westpower. 2006 2005
The following transactions occurred between Westpower $000's $000's
and the Trust:
Amounts recievable from WCEPT 0 0
Dividends paid to the Trust 156 156
Directors Interests 2006 2005
$000's $000's
"Hugh Little - Operations Manager - Westland Milk Products Ltd
- Owner/Director - Stations Restaurant, Bar &
Accommodation "
Services received from the group. 590 266
Services provided to the group. 0 0
Sue Merriman - Managing Director - Marshall and Heaphy Ltd
Services received from the group. 7 12
Services provided to the group. 0 0
Richard Cornelius - Director - CMP Kokri Ltd
Services received from the group. 25 0
Services provided to the group. 0 0
No related party debts have been written off or forgiven during the year.
Note 11. Cash Flows
Reconciliation of Net Cash Flows from Operating Activities
2006 2005
$000's $000's
Net surplus After Income Tax 3,270 2,972
Plus Non Cash Items:
Depreciation 2,117 1,953
Vested Assets (1,054) (664)
1,063 1,289
Movements in Working Capital:
Increase in Debtors (77) (288)
Decrease in Creditors, Accrued Interest 847 (491)
Working Capital Transferred from Other Business 0 0
Increase in Income Tax Refund (251) 222
519 (557)
Other
Decrease in Gratuities Provision
(Gain) Loss on Disposal of Assets 323 552
323 552
Operating Cashflow 5,175 4,256
Note 12. ODV Reconciliation Report
2006 2005
$000's $000's
System fixed assets at ODV at beginning of year 69,770 63,643
Add system fixed assets acquired during the year at ODV 9,393 8,577
Less system fixed assets disposed of during the year at ODV (299) (552)
Less depreciation system fixed assets at ODV (2,056) (1,898)
Add revaluations of system fixed assets 0 0
System fixed assets at ODV at end of year 76,808 69,77WESTPOWER LIMITED - LINES BUSINESS
Disclosure of Information to be Disclosed in Financial Statements under requirement 6 of the
Electricity (Information Disclosure) Requirements 2004 Schedule 1 Part 2.
2006 2005
$ '000 $ '000
Statement of Financial Position Disclosure (Schedule 1, Part 2)
1 Current Assets
(a) Cash and Bank Balances 714 167
(b) Short-term Investments
(c) Inventories
(d) Accounts receivable 1,817 1,740
(e) Other current assets not listed in (a) to (d) 338 87
(f) Total current assets 2,869 1,994
2 Fixed Assets
(a) System fixed assets 72,611 65,822
(b) Consumer billing and information system assets
(c) Motor Vehicles
(d) Office Equipment 534 275
(e) Land & Buildings 3,071 1,726
(f) Capital works under construction
(g) Other fixed assets not listed in (a) to (f)
(h) Total fixed assets 76,216 67,823
3 Other tangible assets not listed above 1,280 1,244
4 Total tangible assets 80,365 71,061
5 Intangible assets
(a) Goodwill
(b) Other intangible not listed in (a)
(c) Total intangible assets
6 Total Assets 80,365 71,061
7 Current Liabilities
(a) Bank Overdraft
(b) Short-term borrowings
(c) Payables and accruals 2,293 2,925
(d) Provision for dividends payable
(e) Provision for income tax
(f) Other Current Liabilities not listed in (a) to (e)
(g) Total Current Liabilities 2,293 2,925
8 Non-current Liabilities
(a) Payables and accruals
(b) Borrowings 11,474 4,652
(c) Deferred tax
(d) Other Non-current Liabilities not listed in (a) to (c)
(e) Total Non-current Liabilities 11,474 4,652
2006 2005
$ '000 $ '000
9 Equity
(a) Shareholders equity
(i) Share Capital 30,300 30,300
(ii) Retained Earnings 13,917 10,803
(iii) Reserves 22,381 22,381
(iv) Total Shareholders equity 66,598 63,484
(b) Minority interests in subsidiaries
(c) Total Equity 66,598 63,484
(d) Capital notes;
(e) Total capital funds 66,598 63,484
10 Total equity and liabilities 80,365 71,061
Statement of Financial Performance Disclosure (Schedule 1, Part 2)
11 Operating Revenue
(a) Revenue from line/access charges 11,662 12,263
(b) Revenue from "Other" business (transfer payment) 75
(c) Interest on cash, bank balances and short-term investments 43 53
(d) AC loss-rental rebates 321 174
(e) Other operating revenue not listed in (a) to (d) 2,029 1,239
(f) Total operating revenue 14,130 13,729
12 Operating expenditure
(a) payment for transmission charges 2,327 2,242
(b) Transfer payments to the "Other" business for -
(i) Asset maintenance 2,517 2,493
(ii) Consumer disconnections and reconnections
(iii) Meter data
(iv) Consumer-based load control
(v) Royalty and patent expenses
(vi) Avoided transmission charges on account of own generation
(vii) Other goods & services not listed in (i) to (vi) above 542 543
(viii) Total transfer payment to the "Other" business 3,059 3,036
(c) Payments to non-related entities
(i) Asset maintenance 63 60
(ii) Consumer disconnection/reconnection services
(iii) Meter data
(iv) Consumer-based load control
(v) Royalty and patent expenses
(vi) Total of specified expenses to non-related parties 63 60
(d) Employee salaries, wages and redundancies
(e) Consumer billing and information system expense
(f) Depreciation on
(i) System fixed assets 2,056 1,882
(ii) Other assets not listed in (i) 61 71
(iii) Total depreciation expense 2,117 1,953
(g) Amortisation of
(i) Goodwill
(ii) Other intangibles
(iii) Total amortisation of intangibles
2006 2005
$ '000 $ '000
(h) Corporate and administration 657 726
(i) Human resource expenses
(j) Marketing/advertising
(k) Merger and acquisition expenses
(l) Takeover defence expenses
(m) Research and development expenses
(n) Consultancy and legal expenses 309 381
(o) Donations
(p) Directors fees 51 58
(q) Audit fees
(i) Audit fees paid to principal auditors 38 40
(ii) Audit fees paid to other auditors
(iii) Fees paid for other services provided by auditors
(iv) Total auditors fees 38 40
(r) Costs of offering credit
(i) Bad debts written off
(ii) Increase in estimated doubtful debts
(iii) Total costs of offering credit
(s) Local authority rates 56 55
(t) AC loss-rental (distribution of) expense 321 174
(u) Rebates to Consumers due to ownership interest
(v) Subvention payments
(w) Unusual expenses
(x) Other expenditure not listed in (a) to (w) 323 552
13 Total operating expenditure 9,321 9,277
14 Operating surplus before interest and income tax 4,809 4,452
15 Interest
(a) Interest expense on borrowings 612 257
(b) Financing charges related to finance leases
(c) Other interest expense
(d) Total interest expense 612 257
16 Operating surplus before income tax 4,197 4,195
17 Income Tax 927 1,223
18 Net Surplus after tax 3,270 2,972
PERFORMANCE MEASURES
Disclosure of financial performance measures and efficiency performance measures under
Requirement 14 of the Electricity (Information Disclosure) Requirements 2004 Schedule 1 Part 3.
2006 2005 2004 2003
1 Financial performance measures
(a) Return on funds 6.41% 6.51% 6.34% 13.02%
(b) Return on equity 4.81% 4.54% 4.47% 10.31%
(c) Return on investment 4.91% 4.59% 16.36% 8.76%
2 Efficiency performance measures: 2006 2005 2004 2003
(a) Direct lines costs per kilometre $1,581.81 $1,555.77 $1,681.46 $1,232.30
Direct Expenditure 3,196,830 3,114,661 3,325,936 2,441,192
System Length 2,021 2,002 1,978 1,981
(b) Indirect lines costs per electricity Consumer * $113.00 $106.75 $104.77 $100.79
Indirect Expenditure 1,357,170 1,284,339 1,250,064 1,217,210
Total consumers * 12,010 12,031 11,931 12,077
* Number of consumers based on ICP connections
Disclosure of energy delivery efficiency performance measures under requirement 20
of the Electricity (Information Disclosure) Requirements 2004 Schedule 1 Part 4.
1 Energy Delivery efficiency performance measures:
(a) Load factor (a/b*c*100) 65.0% 64.2% 65.6% 63.1%
a = kWh of electricity entering system 223,809,000 209,115,825 207,165,465 211,261,285
b = Maximum demand 39,292 37,172 36,024 38,232
c= Total number of hours in year 8,760 8,760 8,760 8,760
(b) Loss ratio (=a/b*100) 5.7% 5.9% 7.0% 4.5%
a = losses in electricity in kWh 12,825,000 12,298,050 14,434,000 9,603,837
b = kWh of electricity entering system 223,809,000 209,115,825 207,165,465 211,261,285
(c) Capacity utilisation (=a/b*100) 31% 31% 31% 35%
a = Maximum demand 39,292 37,172 36,024 38,232
b = Transformer Capacity 127,000 119,309 116,726 109,003
2 Statistics
(a) System Length
Circuit Kilometres 66kV 60 60 60 56
Circuit Kilometres 33kV 246 246 246 230
Circuit Kilometres 11kV 1,459 1,440 1,416 1,492
Circuit Kilometres 230/400V 256 256 256 203
Total 2,021 2,002 1,978 1,981
(b) System Length - Overhead
Circuit Kilometres 66kV 60 60 60 56
Circuit Kilometres 33kV 244 244 244 230
Circuit Kilometres 11kV 1419 1403 1383 1,458
Circuit Kilometres 230/400V 169 169 169 142
Total Overhead 1892 1876 1856 1,886
(c) System Length - Underground 2006 2005 2004 2003
Circuit Kilometres 66kV 0 0 0 0
Circuit Kilometres 33kV 2 2 2 0
Circuit Kilometres 11kV 40 37 33 34
Circuit Kilometres 230/400V 87 87 87 61
Total Underground 129 126 122 95
(d) Transformer Capacity (In Kilovolt Amperes)
District (zone) Substations 151,000 107,000 107,000 96,000
Distribution Substations 127,000 119,309 116,726 109,003
Total Substations 278,000 226,309 223,726 205,003
(e) Maximum Demand 39,292 37,172 36,024 38,232
(f) Total electricity supplied from the system 223,809,000 209,115,825 207,165,465 211,261,285
before losses (in Kilowatt Hours)
(g) Electricity conveyed for each retailer after losses
Retailer 1 - - - -
Retailer 2 14,576,000 3,153,752 - -
Retailer 3 2,750,000 3,887,007 9,791,672 8,631,685
Retailer 4 16,651,000 15,742,067 14,192,942 25,028,359
Retailer 5 23,734,000 12,988,446 9,920,251 9,053,917
Retailer 6 153,273,000 161,046,503 158,826,600 158,943,487
Retailer 7
210,984,000 196,817,775 192,731,465 201,657,448
(h) Total Consumers * 12,010 12,031 11,931 12,077
* Number of consumers based on ICP connections
Disclosure of reliability performance measures under requirement 21 of the Electricity (Information Disclosure) Requirements 2004
Schedule 1 Part 5.
1 Total number of interruptions
Class A - Planned - by Transpower 0 2 4 0
Class B - Planned - by Line Owners 63 140 50 63
Class C - Unplanned - by Line Owners 122 136 171 57
Class D - Unplanned - by Transpower 2 6 1 0
Class E - Unplanned - by ECNZ 0 0 0 0
Class F - Unplanned - by other generation 0 0 0 0
Class G - Unplanned - by other line owner 0 0 0 0
Class H - Planned - by other line owner 0 0 0 0
Class I - Any other loss of supply 0 0 0 0
Total 187 284 226 120
2 Interruption targets for 2006/2007
Class B - Planned - by Line Owners 60
Class C - Unplanned - by Line Owners 60
3 Average interruption targets for 2006/2007 to 2009/2010 years
Class B - Planned - by Line Owners 60
Class C - Unplanned - by Line Owners 60
4 Proportion of Class C interruptions not restored within: (=a/b*100)
3 Hours 13.9%
a = number of interruptions not restored within 3 hours 17
b = total number of Class C interruptions 122
24 Hours 0.0%
a = number of interruptions not restored within 24 hours 0
b = total number of Class C interruptions 122
2006 2005 2004 2003
5 (a) The total number of faults per 100 circuit kilometres of prescribed voltage
electric line
66kV - - - 2
33kV 1 7 10 3
11kV 6 17 13 8
Total 4.8 12.9 11 6
(b) Target for 2006/2007 year
66kV 1
33kV 3
11kV 7
Total 5.3
(c) Average Target for 2005/2006 to 2009/2010 years
66kV 1
33kV 3
11kV 7
Total 5.3
6 The total number of faults per 100 circuit kilometres of underground prescribed
voltage electric line
33kV 50 50 50 0
11kV 13 14 39 9
Total 5 5 9 9
7 The total number faults per 100 circuit kilometres of overhead prescribed
voltage electric line
66kV 0 0 0 2
33kV 1 7 9 2
11kV 6 17 12 8
Total 5 13 10 6
8 The SAIDI for the total number of interruption 151.12 372.06 205.49 122.02
9 SAIDI targets for 2006/2007
Class B - Planned - by Line Owners 40
Class C - Unplanned - by Line Owners 70
10 Average SAIDI target for 2006/2007 to 2009/2010 years
Class B - Planned - by Line Owners 40
Class C - Unplanned - by Line Owners 70
11 The SAIDI for the total number of interruptions within each interruption class
2006 2005 2004 2003
Class A - Planned - by Transpower 0 3.07 5.47 0
Class B - Planned - by Line Owners 76.39 71.31 42.11 66.76
Class C - Unplanned - by Line Owners 69.49 188.54 145.64 55.26
Class D - Unplanned - by Transpower 5.24 109.14 12.27 0
Class E - Unplanned - by ECNZ 0 0 0 0
Class F - Unplanned - by other generation 0 0 0 0
Class G - Any other loss of supply 0 0 0 0
151.12 372.06 205.49 122.02
12 The SAIFI for the total number of interruption 2.04 4.23 2.40 1.16
13 SAIFI target for 2006/2007
Class B - Planned - by Line Owners 0.25
Class C - Unplanned - by Line Owners 1
14 Average SAIFI target for 2006/2007 to 2009/2010 years
Class B - Planned - by Line Owners 0.25
Class C - Unplanned - by Line Owners 1
15 The SAIFI for the total number of interruptions within each interruption class
Class A - Planned - by Transpower 0.00 0.01 0.02 0
Class B - Planned - by Line Owners 0.28 0.34 0.19 0.27
Class C - Unplanned - by Line Owners 1.10 2.89 2.02 0.89
Class D - Unplanned - by Transpower 0.66 0.99 0.17 0
Class E - Unplanned - by ECNZ 0 0 0 0
Class F - Unplanned - by other generation 0 0 0 0
Class G - Any other loss of supply 0 0 0 0
2.04 4.23 2.4 1.16
16 The CAIDI for the total number of interruption 73.90 88.03 85.62 105
17 CAIDI targets for 2006/2007
Class B - Planned - by Line Owners 160
Class C - Unplanned - by Line Owners 70
18 Average CAIDI target for 2006/2007 to 2009/2010 years
Class B - Planned - by Line Owners 160
Class C - Unplanned - by Line Owners 70
2006 2005 2004 2003
19 The CAIDI for the total number of interruptions within each interruption class
Class A - Planned - by Transpower 0.00 477.79 274 0
Class B - Planned - by Line Owners 272.82 207.00 221 247
Class C - Unplanned - by Line Owners 63.17 65.00 72 62
Class D - Unplanned - by Transpower 7.94 110.61 72 0
Class E - Unplanned - by ECNZ 0 0 0 0
Class F - Unplanned - by other generation 0 0 0 0
Class G - Any other loss of supply 0 0 0 0
73.90 88.03 85.62 105
0
WESTPOWER LIMITED - LINES BUSINESS
SCHEDULE 1 - PART 7
FORM FOR THE DERIVATION OF FINANCIAL PERFORMANCE MEASURES FROM FINANCIAL STATEMENTS
Derivation Table Input and Calculations Symbol in ROF ROE ROI
formula
Operating surplus before interest and income tax from
financial statements 4,809
Operating surplus before interest and income tax
adjusted pursuant to requirement 18 (OSBIT) 4,809
Interest on cash, bank balances, and short-tem
investments (ISTI) 43
OSBIT minus ISTI 4,766 a 4,766 4,766
Net Surplus after tax from financial statements 3,270
Net surplus after tax adjusted pursuant to requirement 18
(NSAT) 3,270 n 3,270
Amortisation of goodwill and amortisation of other
intangibles g add - add - add -
Subvention payment s add - add - add -
Depreciation of SFA at BV (x) 2,056
Depreciation of SFA at ODV (y) 2,056
ODV depreciation adjustment d add add add
Subention payment tax adjustment - s*t deduct - deduct -
Interest tax shield 188 q deduct 188
Revaluations r add
Income tax 927 p deduct 927
Numerator 4,766 3,270 3,651
OSBITTADJ=a+g+s+d NSATADJ=n+g+s-s*t+d BIITADJ=a+g-q+r+s+d-p-s*t
Fixed asset at end of previous year (FA0) 67,823
Fixed assets at end of current financial year (FA1) 76,216
Adjusted net working capital at end of previous
financial year (ANWC0) (1,098)
Adjusted net working capital at end of current financial
year (ANWC1) (138)
Average total funds employed (ATFE) 71,402 c 71,402 71,402
Total equity at end of previous financial year (TE0) 63,484
Total equity at end of current financial year (TE1) 66,598
Average total equity 65,041 k 65,041
WUC at end of previous financial year (WUC0)
WUC at end of current financial year (WUC1)
Average total works under construction e deduct deduct deduct
Revaluations r
Half of revaluations r/2 deduct
Intangible assets at end of previous financial year
(IA0) -
Intangible assets of end of current financial year
(IA1) -
Average total intangible asset - m deduct -
Subvention payment at end of previous financial
year (S0) -
Subvention payment at end of current financial year
(S1) -
Subvention payment tax adjustment at end of previous
financial year -
Subvention payment tax adjustment at end of current
financial year -
Average subvention payment and related tax adjustment - v add -
System fixed assets at end of previous year at
book value (SFABV0) 66,793
System fixed assets at end of current financial year
at book value (SFAbv1) 73,830
Average value of system fixed assets at book value 70,312 f deduct 70,312 deduct 70,312 deduct 70,312
System fixed assets at year beginning at ODV value
(SFAodv0) 69,770
System fixed assets at end of current financial year
at ODV value (SFAodv1) 76,808
Average value of system fixed assets at ODV value 73,289 h add 73,289 add 73,289 add 73,289
Denominator 74,379 68,018 74,379
ATFEADJ=c-e-f+h AveTEADJ=k-e-m+v-f+h ATFEADJ=c-e-1/2r-f+h
Financial performance measure 6.41% 4.81% 4.91%
ROF=OSBIITADJ/ATFRADJ x 100 ROE=NSATADJ/ATEADJ x 100 ROI=OSBIITADJ/ATFEADJ x 100
t = maximum statutory income tax rate applying to corporate entities, bv = book value, ave = average, odv = optimised deprival valuation, subscript '0' = end of previous financial year
subscript '1' = end of current financial year ROF = return on funds ROE = return on equity ROI = return on investment
AUDIT NEW ZEALAND
REPORT OF THE AUDITOR-GENERAL
TO THE READERS OF THE FINANCIAL STATEMENTS OF WESTPOWER LIMITED FOR THE YEAR ENDED 31 MARCH 2006
We have audited the financial statements of Westpower Limited on pages 1 to 16. The financial statements provide information about the past financial performance of Westpower Limited and its financial position as at 31 March 2006. This information is stated in accordance with the accounting policies set out on pages 1 to 4.
Directors' responsibilities
The Commerce Commission's Electricity Information Disclosure Requirements 2004 made under section 57T of the Commerce Act 1986 require the Directors to prepare financial statements which give a true and fair view of the financial position of Westpower Limited as at 31 March 2006, and the results of its operations and cash flows for the year ended on that date.
Auditor's responsibilities
Section 15 of the Public Audit Act 2001 and Requirement 30 of the Electricity Information Disclosure Requirements 2004 require the Auditor-General to audit the financial statements. It is the responsibility of the Auditor-General to express an independent opinion on the financial statements and report that opinion to you.
The Auditor-General has appointed Tony Uttley of Audit New Zealand to undertake the audit.
Basis of opinion
An audit includes examining, on a test basis, evidence relevant to the amounts and disclosures in the financial statements. It also includes assessing:
§ the significant estimates and judgements made by the Directors in the preparation of the financial statements; and
§ whether the accounting policies are appropriate to Westpower Limited's circumstances, consistently applied and adequately disclosed.
We conducted the audit in accordance with the Auditing Standards published by the Auditor General, which incorporate the Auditing Standards issued by the Institute of Chartered Accountants of New Zealand. We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to obtain reasonable assurance that the financial statements are free from material misstatements, whether caused by fraud or error. In forming our opinion, we also evaluated the overall adequacy of the presentation of information in the financial statements.
Other than in our capacity as auditor acting on behalf of the Auditor-General, we have no relationship with or interests in Westpower Limited1.
Unqualified opinion
We have obtained all the information and explanations we have required.
In our opinion:
§ proper accounting records have been maintained by Westpower Limited as far as appears from our examination of those records; and
§ the financial statements of Westpower Limited on pages 1 to 16:
(a) comply with generally accepted accounting practice in New Zealand; and
(b) give a true and fair view of Westpower Limited's financial position as at 31 March 2006 and the results of its operations and cash flows for the year ended on that date; and
(c) comply with the Electricity Information Disclosure Requirements 2004.
Our audit was completed on 17 November 2006 and our unqualified opinion is expressed as at that date.
Tony Uttley
Audit New Zealand
On behalf of the Auditor-General
Christchurch, New Zealand
1In addition to issuing audit certificates pursuant to the Electricity Information Disclosure Requirements 2004 we had carried out other audit assignments for Westpower Limited. This involved issuing an audit opinion on the annual financial statements for the year ended 31 March 2006. These assignments are compatible with those independence requirements. Other than this assignment we have no relationship with or interest in Westpower Limited.
AUDIT NEW ZEALAND
AUDITOR-GENERAL'S OPINION ON THE PERFORMANCE MEASURES OF WESTPOWER LIMITED
We have examined the information on pages 13, 16, 17, 22 and 23 being -
(a) the derivation table in requirement 15;
(b) the annual ODV reconciliation report in requirement 16;
(c) the financial performance measures in clause 1 of Part 3 of Schedule 1; and
(d) the financial components of the efficiency performance measures in clause 2 of Part 3 of Schedule 1, -
that were prepared by Westpower Limited and dated 17 November 2006 for the purposes of the Commerce Commission's Electricity Information Disclosure Requirements 2004.
In our opinion, having made all reasonable enquiry, and to the best of our knowledge, that information has been prepared in accordance with those Electricity Information Disclosure Requirements 2004.
Tony Uttley
Audit New Zealand
On behalf of the Auditor-General
Christchurch, New Zealand
17 November 2006