New Zealand Gazette – 1997 – No. 165

Page 3928

✨ Financial Performance Measures



NEW ZEALAND GAZETTE

No. 165

TRANS POWER NEW ZEALAND LIMITED

REGULATION 13.14 AND PART II OF THE FIRST SCHEDULE OF THE ELECTRICITY (INFORMATION DISCLOSURE) REGULATIONS 1994

12 months 30 June 1997 12 months 30 June 1996 12 months 30 June 1995 15 months 30 June 1994
Financial Performance Measures
a) Accounting return on total assets, being earnings before interest and tax divided by average total funds employed:
Earnings before interest and tax 226,416,000 249,962,000 231,334,000 219,778,000
Average total funds employed 2,794,260,000 2,801,854,500 2,822,542,000 2,841,695,000
Accounting return on total assets 8.1% 8.9% 8.2% 7.7%

In 1994 total funds employed included Works Under Construction, giving an Accounting Return on Total Assets of 7.5%. Works Under Construction is now excluded to align the definition with an economic view of operating capital employed, as interest is capitalised on the Works Under Construction balance.

| b) Accounting return on equity, being net profit after tax, divided by average total shareholders funds: |
| Net profit after tax | 92,896,000 | 96,395,000 | 84,523,000 | 102,017,000 |
| Average total shareholders funds | 1,337,528,000 | 1,302,536,500 | 1,228,540,000 | 1,251,674,000 |
| Accounting return on equity | 6.9% | 7.4% | 6.9% | 8.2% |

| c) Accounting rate of profit, which shall be calculated in accordance with the following formula: |
| (a - b - c + d) / e |
| a | Earnings before interest and tax | 226,416,000 | 249,962,000 | 231,334,000 | 219,778,000 |
| b | Cash tax | 29,435,000 | 32,878,000 | 25,506,000 | 15,890,000 |
| c | Interest tax shield | 36,637,000 | 36,874,570 | 40,690,000 | 35,822,000 |
| d | Revaluations | (12,372,000) | 0 | 0 | 0 |
| e | Average total funds employed, minus half the amount of revaluations | 2,800,446,000 | 2,791,213,500 | 2,792,710,000 | 2,841,695,000 |
| Accounting rate of profit | 5.3% | 7.2% | 8.0% | 5.9% |

As noted under a) above, the definition of total funds employed has been changed. The percentage previously reported for the 12 months ended 30 June 1994 was 5.8%.

Efficiency performance measures

Direct line costs per kilometre, which shall be calculated in accordance with the following formula:

a / b

a is direct expenditure (in dollars); and
b is system length (in kilometres);

12 months 30 June 1997 12 months 30 June 1996 12 months 30 June 1995 15 months 30 June 1994
Direct expenditure 122,388,000 116,444,000 119,878,000 125,613,000
System length (km) 17,693 17,739 17,626 17,629
Direct line costs per kilometre $6,917 $6,564 $6,801 $7,125

In 1994 the infrastructure asset service potential adjustment determined in respect of transmission lines was included within the definition of direct expenditure and direct leases and rental costs were excluded. In addition, in 1994 and 1995 system length was incorrectly defined. System length is now correctly reported as the average total circuit length of electric lines which form part of the system including the HVDC cables. Direct leases and rental costs are now also correctly reported. The direct line costs per kilometre previously reported were $9,521 and $11,007 for 30 June 1995 and 1994 respectively.



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🏭 Notes to the Financial Statements (continued from previous page)

🏭 Trade, Customs & Industry
Financial Instruments, Fair Value, Cross Currency Interest Rate Swaps, Foreign Exchange Forward Contracts, Interest Rate Swaps, Forward Rate Agreements, Interest Rate Options, Foreign Currency Options, Subsidiary Companies, Associate Companies, Transpower New Zealand Limited, Financial Performance Measures, Accounting return on total assets, Earnings before interest and tax, Average total funds employed, Accounting return on equity, Net profit after tax, Average total shareholders funds, Accounting rate of profit, Efficiency performance measures, Direct line costs per kilometre, Direct expenditure, System length