New Zealand Gazette – 2003 – No. 133

Page 3607

✨ Financial Statements Notes



VECTOR Limited

Electricity Lines Business

Notes to the Financial Statements

For the year ended 31 March 2003

10. BORROWINGS - CONTINUED

As at 31 March 2002 Weighted average interest rates Total Repayable within 1 year Repayable between 1 and 2 years Repayable between 2 and 5 years Repayable after 5 years
% $000 $000 $000 $000 $000
Bank loans 7.10 104,810 104,810 - - -
Commercial paper 4.94 11,484 11,484 - - -
Balance at end of year 6.42 116,294 116,294 - - -

All borrowings are unsecured with all bank loans and medium term notes subject to negative pledge arrangements. The unsecured bank loans are subject to various covenants such as limitations on long term indebtedness, minimum net worth and working capital ratios. The VECTOR Group, of which the electricity lines business is the predominant activity, was in compliance with all covenants for the 2003 and 2002 financial years.

Interest rates for all bank loans, including the working capital loan, are floating based on the bank bill rate plus a margin.

Medium term notes – fixed rate NZ$ mature April 2007 and are shown at the value of proceeds received after deducting the discount on issue ($1.7 million) and adjusted for the amount amortised ($0.6 million).

Medium term notes – floating rate A$ mature April 2008 and April 2011.

Borrowings are classified between current and non-current dependent on the repayment dates.

11. CAPITAL BONDS

On 5 November 2002 the Company issued 307,205,000 capital bonds for $307,205,000. The capital bonds have an initial term of 4 years from the date of issue. The capital bonds are convertible into VECTOR Limited Ordinary shares in certain limited circumstances and have a principal amount of NZ$1.00 each.

The interest rate of 8.25% is fixed until the first election date of 15 December 2006, and thereafter will be reset at intervals determined by VECTOR Limited. If a Public Offer (which involves the quotation of Ordinary Shares on the NZX and the issue of at least 24.9% of the total VECTOR Limited ordinary share capital to persons other than the AEOT) is not completed by 30 September 2003, the interest rate will be increased by 1.5% per annum as from 15 June 2003 (until the date on which a Public Offer is completed or the first election date, whichever date is earlier). Such an adjustment will be in addition to any adjustment to the interest rate as a result of a change to VECTOR Limited credit rating.

The capital bonds are unsecured debt obligations of VECTOR Limited, which are subordinated to all other creditors of VECTOR Limited and are constituted by a Trust Deed entered into by VECTOR Limited and The New Zealand Guardian Trust Company Limited as Trustee dated 25 September 2002.

The purpose of the capital bonds was to partially finance VECTOR Limited's acquisition of UnitedNetworks Limited.

The capital bond details above represent the amount actually issued by VECTOR Group, of which the electricity lines business is the predominant activity. This differs from the capital bonds in the statements of financial position and the table below as these figures represent the electricity lines business' allocation of the total capital bonds.

2003 2002
$000 $000
Capital bonds issued – electricity lines business allocation 288,010 -
Capitalised costs – electricity lines business allocation (10,459) -
Less amortisation of capitalised costs – electricity lines business allocation 1,064 -
Balance at end of year 278,615 -


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Online Sources for this page:

VUW Te Waharoa — PDF NZ Gazette 2003, No 133


Gazette.govt.nz — PDF NZ Gazette 2003, No 133




✨ LLM interpretation of page content

🏭 Vector Limited Financial Position Statements (continued from previous page)

🏭 Trade, Customs & Industry
31 March 2003
Electricity, Financial Statements, Borrowings, Interest Rates, Capital Bonds, Bank Loans, Commercial Paper, Medium Term Notes, Covenants, Compliance