TRUSTEES’ REPORT

On behalf of the Trustees I am pleased to present the Annual Report of the Trust for the year ending 31 March 2013.

While the volatility of financial markets continues, creating uncertainty about the future outlook, the past financial year provided an environment in which the Trust was able to realise a better financial performance from its investments. This has allowed the Trust to continue to meet the needs of our communities for financial assistance.

DONATIONS

During the year the Trust approved 657 donations, totalling a net $4.5 million. The number of applications received during the year decreased to 857, a fall of nearly 6% over the previous year. The Trust approved 77% of those applications, while 184 applications (21%) were declined and 16 applications (2%) were withdrawn by the applicant. All applications received, except those withdrawn by the applicant, were presented to the Board for consideration.

The average request of $13,506 was higher than the previous year, while the average donation amount approved decreased, from $5,366 to $4,924, reflecting the reduced donations budget available. As a result the ratio of the average request to the average donation increased slightly for 2012/13 to 2.74.

The Trust values its unique relationship with the four Regional Sports Trusts operating within our region, and the funding we provide to them continues to generate strong benefits for their communities. The support for the Regional Sports Trusts was reduced slightly from the previous year, as part of the overall reduction in the donations budget. The Trust’s Summer Reading Programme, has now completed its 16th successful year of operation. The Summer Reading Programme now covers a wider age range than it did when it started, as well as offering a condensed mid-winter programme. The Trustees appreciate the continued efforts of the staff at the participating libraries, particularly those on the organising committee, in offering this programme – we recognise that the success of the programme would not be possible without their on-going support. A further series of ‘Maths is Fun’ programmes was supported by the Trust, in several locations throughout the region during the school holidays.

FINANCIAL

As at 31st March 2013, the Trust’s net assets were $145.7 million, which was an increase of $8.5 million from the previous year. The net gain from investments for the year was $14.4 million, which after the payment of administration expenses and donations led to the Trust’s overall net surplus of $8.5 million. The surplus includes $7.7 million of unrealised gains on our investments, related to changes in currency values as well as market movements.

The Trust continued its policy of being 50% hedged on average during the last financial year, and hedging gains partly offset the unrealised losses due to changing currency values. The Trust is adjusting its investment strategy to place greater emphasis on income rather than growth, to ensure its continued ability to meet community requests for funding, which can only be done from income. The Trust has also determined to move away from managed fund investments to direct holding of equity investments, and this change in strategy has been implemented in the early part of the 2013/2014 financial year.

The Trust’s net assets were $9.0 million above the adjusted capital base of the Trust of $136.7 million. The Trust continues to be managed efficiently, with operating expenses for the year 8% below budget, at $1.3 million, and slightly less than the previous year. In part this reduction in operating expenses is due to the introduction of electronic delivery of documentation to trustees in early 2012.