✨ Financial Statements
2828 No. 115
NEW ZEALAND GAZETTE
WEL ENERGY GROUP LIMITED
7 Investments in associates
At 31 March 1998 the Group owned a 25.1% shareholding in Salamanca Holdings Limited. Salamanca Holdings Limited is an investment company whose principal investment is shares in Pacific Energy Limited and has a balance date of 31 March.
The Directors believe net asset backing is the best estimate of fair value, accordingly the investment has been written down by $971,000 (1997 nil) to reflect the latest asset backing.
| Line Business | Energy Business | ||
|---|---|---|---|
| 1998 | 1997 | 1998 | 1997 |
| ($000s) | ($000s) | ($000s) | ($000s) |
| ------------------------ | --------------- | ------------------------- | --------------- |
8 Current liabilities
| | 1998 | 1997 | 1998 | 1997 |
|-------------------------|---------------|-------------------------|---------------|
| | ($000s) | ($000s) | ($000s) | ($000s) |
| Trade creditors | 4,999 | 2,842 | 4,094 | 3,769 |
| Customer deposits | 331 | 306 | 331 | 306 |
| Provision for annual and long service leave | 380 | 361 | 128 | 93 |
| Provision for dividend | 4,420 | - | 634 | - |
| | 10,130 | 3,509 | 5,187 | 4,168 |
9 Contingencies
There are no contingent liabilities in either the line or energy business.
10 Capital commitments
Capital commitments in the line business amounted to $2,108,000 (1997 nil). There are no capital commitments in the energy business (1997 nil).
11 Financial Instruments
(a) Electricity Price Risk
Nature of activities and management policies with respect to financial instruments:
(i) Electricity price hedging contracts
The Group has entered into electricity price hedges with its suppliers. Under these agreements the Group agrees with its electricity suppliers a fixed price (hedge price) for a percentage of its estimated electricity needs. On maturity of the electricity price hedges any difference between the hedge price and the spot market price is settled between the parties.
(ii) Concentrations of Credit Risk
In the normal course of its business, the Group incurs credit risk from trade receivables from customers and transactions with financial institutions. A provision has been set up for trade receivables which are unlikely to be collected.
The Group has a credit policy which is used to manage this exposure to credit risk. As part of this policy, limits on exposures with counterparties have been set and are monitored on a regular basis. There are no significant concentrations of credit risk and the Group does not require any collateral.
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VUW Te Waharoa —
NZ Gazette 1998, No 115
NZLII —
NZ Gazette 1998, No 115
✨ LLM interpretation of page content
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Notes to the Financial Statements by WEL Energy Group Limited
(continued from previous page)
🏭 Trade, Customs & IndustryFinancial Statements, Investments, Liabilities, Contingencies, Capital Commitments, Financial Instruments, Electricity Price Risk, Credit Risk