Part D: ​Financial information

Financial Statements

Prospective Statement of Comprehensive Revenue and Expense

  2014/15
AP
$000
2015/16
LTP
$000
Variance
to LTP
$000
Notes
$000
2016/17
LTP
$000
2017/18
LTP
$000
2018/19
LTP
$000
2019/20
LTP
$000
2020/21
LTP
$000
2021/22
LTP
$000
2022/23
LTP
$000
2023/24
LTP
$000
2024/25
LTP
$000
                           
REVENUE                          
Revenue from rates 255,266 270,907 15,641   283,927 302,482 324,619 338,630 356,310 370,655 385,232 403,875 414,970
Revenue from development contributions 2,000 2,000 -   2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000
Revenue from grants, subsidies and reimbursements 51,090 42,511 (8,579) 1 42,062 28,578 21,447 19,271 20,332 20,875 21,341 21,773 22,826
Revenue from operating activities 119,913 121,287 1,374 2 124,817 127,764 130,677 134,404 136,116 136,818 140,884 143,932 147,417
Investments 20,215 20,135 (80)   20,135 20,235 19,635 20,635 23,344 26,693 26,637 29,182 30,429
Fair value movement on investment property revaluation - 3,665 3,665 3 4,324 4,821 5,143 5,482 6,057 6,449 6,865 7,543 8,027
Other revenue 1,100 1,050 (50)   1,050 1,050 1,050 1,050 1,050 1,050 1,050 1,050 1,050
Finance revenue 603 637 34   650 663 719 693 731 776 827 886 952
TOTAL REVENUE 450,187 462,192 12,005   478,965 487,593 505,290 522,165 545,940 565,316 584,836 610,241 627,671
EXPENSE                          
Finance expense 23,041 22,961 (80) 4 26,498 32,365 36,868 38,926 40,453 43,602 47,956 53,549 55,946
Expenditure on operating activities 298,596 316,333 17,737 5 329,850 332,403 338,405 351,221 363,135 376,887 387,814 398,961 411,419
Depreciation and amortisation 102,165 99,797 (2,368)   102,250 108,742 114,681 116,963 124,694 128,634 131,158 139,648 143,188
TOTAL EXPENSE 423,802 439,091 15,289   458,598 473,510 489,954 507,110 528,282 549,123 566,928 592,158 610,553
NET SURPLUS FOR THE YEAR 26,385 23,101 (3,284)   20,367 14,083 15,336 15,055 17,658 16,193 17,908 18,083 17,118
OTHER COMPREHENSIVE REVENUE AND EXPENSE                          
Fair value movement - property, plant and equipment - net 57,073 - (57,073)   223,273 72,997 - 241,128 104,866 - 335,906 142,645 -
TOTAL OTHER COMPREHENSIVE REVENUE AND EXPENSE 57,073 - (57,073)   223,273 72,997 - 241,128 104,866 - 335,906 142,645 -
TOTAL COMPREHENSIVE REVENUE AND EXPENSE 83,458 23,101 (60,357)   243,640 87,080 15,336 256,183 122,524 16,193 353,814 160,728 17,118

Notes to variances:

  1. Reduction in funding from Housing New Zealand for the Housing Upgrade Programme.
  2. Details of specific changes to revenue from activities can be found in the Funding Impact Statements.
  3. The impact of investment property revaluations. This is expected at a rate of half the property inflator detailed in the significant forecasting assumptions.
  4. Debt levels have increased between 2014/15 and 2015/16 but interest rates have decreased creating a modest interest increase.
  5. Details of specific changes to operational costs can be found in the Funding Impact Statements. 

6. EXPLANATION OF NET OPERATING SURPLUS

EXPENDITURE NOT FUNDED UNDER SECTION 100 OF LGA 2015/16
LTP
$000
2016/17
LTP
$000
2017/18
LTP
$000
2018/19
LTP
$000
2019/20
LTP
$000
2020/21
LTP
$000
2021/22
LTP
$000
2022/23
LTP
$000
2023/24
LTP
$000
2024/25
LTP
$000
TOTAL SURPLUS 23,101 20,367 14,083 15,336 15,055 17,658 16,193 17,908 18,083 17,118
                     
Represented by:                    
NZTA Transport funded projects (7,843) (7,595) (7,586) (7,679) (7,566) (7,543) (7,607) (7,686) (7,645) (7,629)
General (834) (90) (80) (70) (60) (50) (40) (30) (20) (10)
Clearwater sewerage treatment plant (2,955) (2,955) (3,174) (3,174) (3,174) (3,443) (3,442) (3,442) (3,771) (3,771)
Decommissioned Living Earth joint venture plant (198) (198) (210) (210) (210) (220) (196) (192) (211) (211)
Wellington Waterfront Limited depreciation (3,654) (3,297) (3,122) (2,857) (2,399) (2,015) (1,645) (1,182) (641) 0
TOTAL EXPENDITURE NOT FUNDED UNDER SECTION 100 OF LGA (15,483) (14,135) (14,172) (13,990) (13,409) (13,270) (12,930) (12,533) (12,289) (11,621)
                     
REVENUE RECEIVED FOR CAPITAL PURPOSES                    
NZTA capital funding 12,668 17,599 21,387 12,597 12,735 13,261 13,647 13,952 14,216 15,093
Ring-fenced housing capital grant and surplus 17,731 15,590 (1,330) (3,081) (1,955) (1,896) (4,524) (3,757) (4,827) (7,895)
Development contributions 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000
Bequests, trust and other external funding 2,690 0 50 600 150 507 507 507 507 507
TOTAL REVENUE RECEIVED FOR CAPITAL PURPOSES 35,090 35,190 22,107 12,116 12,930 13,871 11,630 12,702 11,896 9,705
                     
ITEMS FUNDED FROM PRIOR YEAR SURPLUSES                    
WEID (3,000) (3,000) (1,500) 0 0 0 0 0 0 0
Lyall Bay operational grant (350) 0 0 0 0 0 0 0 0 0
TOTAL ITEMS FUNDED FROM PRIOR YEAR SURPLUS (3,350) (3,000) (1,500) 0 0 0 0 0 0 0
                     
ADDITIONAL ITEMS                    
Weathertight Homes funding 6,661 7,226 7,226 7,226 7,226 8,124 8,124 8,124 8,124 8,132
ICT Infrastructure project (2,880) (2,730) 305 305 305 305 305 305 305 305
Ocean Exploration Centre 0 0 (6,000) 883 883 883 883 883 883 883
Cable car 0 (2,288) 212 212 212 212 212 212 212 212
Westpac Stadium 0 (4,575) 425 425 425 425 425 425 425 425
Alex Moore Park (108) (472) (190) 110 110 110 110 110 110 110
Odyssey (1,079) 221 221 221 221 221 220 0 0 0
Reserves purchases and development fund (39) (30) (24) (11) (11) 0 0 0 0 0
Unrealised fair value adjustment for loans and receivables 624 637 650 706 680 718 763 814 873 939
Fair value movement on investment property revaluation 3,665 4,324 4,821 7,133 5,482 6,057 6,449 6,865 7,543 8,027
TOTAL ADDITIONAL ITEMS 6,844 2,312 7,647 17,209 15,532 17,055 17,491 17,738 18,475 19,033
BALANCED BUDGET UNDER SECTION 100 OF LGA 0 0 1 0 2 2 1 0 1 1

Prospective Statement of Financial PositionTop

  2014/15
AP
$000
2015/16
LTP
$000
Variance
to LTP
$000
Notes 2016/17
LTP
$000
2017/18
LTP
$000
2018/19
LTP
$000
2019/20
LTP
$000
2020/21
LTP
$000
2021/22
LTP
$000
2022/23
LTP
$000
2023/24
LTP
$000
2024/25
LTP
$000
                           
ASSETS                          
Current assets                          
Cash and cash equivalents 2,389 1,249 (1,140)   1,306 1,366 1,194 982 823 902 1,405 1,380 1,248
Derivative financial assets 409 - (409)   - - - - - - - - -
Receivables and recoverables 39,556 42,333 2,777   43,760 45,283 46,915 48,487 49,754 50,548 52,158 53,770 55,139
Prepayments 15,048 12,096 (2,952)   12,815 12,898 13,128 13,707 14,228 14,805 15,256 15,703 16,219
Inventories 875 888 13   906 922 941 958 974 1,002 1,025 1,051 1,076
Total current assets 58,277 56,566 (1,711)   58,787 60,469 62,178 64,134 65,779 67,257 69,844 71,904 73,682
Non-current assets                          
Derivative financial assets 3,280 - (3,280)   - - - - - - - - -
Other financial assets 8,928 10,473 1,545   11,110 11,760 12,466 13,146 13,864 14,627 15,441 16,314 17,253
Intangibles 16,743 28,936 12,193   31,801 37,309 36,746 36,534 36,418 38,868 39,456 42,457 46,125
Investment properties 205,951 196,566 (9,385) 1 200,890 205,711 210,854 216,336 222,393 228,842 235,707 243,250 251,277
Property, plant & equipment 6,974,749 6,674,860 (299,889) 2 6,960,405 7,111,895 7,169,284 7,425,228 7,557,942 7,657,036 8,025,618 8,191,328 8,224,743
Investment in controlled entities 3,809 3,809 -   3,809 3,809 3,809 3,809 3,809 3,809 3,809 3,809 3,809
Investment in associates and jointly controlled entities 19,519 19,504 (15)   19,504 19,504 19,504 19,504 19,504 19,504 19,504 19,504 19,504
Total non-current assets 7,232,979 6,934,148 (298,831)   7,227,519 7,389,988 7,452,663 7,714,557 7,853,930 7,962,686 8,339,535 8,516,662 8,562,711
TOTAL ASSETS 7,291,256 6,990,714 (300,542)   7,286,306 7,450,457 7,514,841 7,778,691 7,919,709 8,029,943 8,409,379 8,588,566 8,636,393
LIABILITIES                          
Current liabilities                          
Derivative financial liabilities 404 - (404)   - - - - - - - - -
Trade and other payables 57,945 59,122 1,177   63,291 68,672 66,017 61,151 64,614 76,529 71,007 71,692 74,991
Revenue in advance 11,405 33,496 22,091 3 13,345 11,289 11,546 11,875 12,027 12,089 12,448 12,717 13,025
Borrowings 155,562 219,789 64,227 4 259,762 301,044 329,269 336,064 343,902 386,962 402,929 411,851 425,866
Employee benefit liabilities and provisions 5,698 6,845 1,147   6,856 6,931 7,060 7,214 7,380 7,608 7,797 8,009 8,225
Provision for other liabilities 17,466 11,790 (5,676)   8,548 6,089 4,819 4,168 3,903 3,878 3,892 3,952 4,001
Total current liabilities 248,480 331,042 82,562   351,802 394,025 418,711 420,472 431,826 487,066 498,073 508,221 526,108
                           
Non-current liabilities                          
Derivative financial liabilities 12,831 - (12,831)   - - - - - - - - -
Trade and other payables - 630 630   630 630 630 630 630 630 630 630 630
Borrowings 248,601 196,474 (52,127) 4 232,206 269,109 294,339 300,414 307,420 345,912 360,185 368,161 380,689
Employee benefit liabilities 1,474 1,708 234   1,711 1,729 1,761 1,800 1,842 1,898 1,945 1,998 2,052
Provisions for other liabilities 43,687 23,945 (19,742) 5 19,402 17,329 16,429 16,221 16,313 16,566 16,861 17,143 17,383
Total non-current liabilities 306,593 222,757 (83,836)   253,949 288,797 313,159 319,065 326,205 365,006 379,621 387,932 400,754
TOTAL LIABILITIES 555,073 553,799 (1,274)   605,751 682,822 731,870 739,537 758,031 852,072 877,694 896,153 926,862
EQUITY                          
Accumulated funds and retained earnings 4,992,265 4,994,681 2,416   5,014,552 5,028,194 5,043,158 5,057,910 5,075,336 5,091,379 5,109,225 5,127,341 5,142,546
Revaluation reserves 1,743,064 1,429,106 (313,958) 2 1,652,379 1,725,376 1,725,376 1,966,504 2,071,370 2,071,370 2,407,276 2,549,921 2,549,921
Hedging reserve (9,955) 137 10,092   137 137 137 137 137 137 137 137 137
Fair value through other comprehensive revenue and expense reserve 93 63 (30)   63 63 63 63 63 63 63 63 63
Restricted funds 10,716 12,928 2,212   13,424 13,865 14,237 14,540 14,772 14,922 14,984 14,951 16,864
TOTAL EQUITY 6,736,183 6,436,915 (299,268)   6,680,555 6,767,635 6,782,971 7,039,154 7,161,678 7,177,871 7,531,685 7,692,413 7,709,531
TOTAL EQUITY AND LIABILITIES 7,291,256 6,990,714 (300,542)   7,286,306 7,450,457 7,514,841 7,778,691 7,919,709 8,029,943 8,409,379 8,588,566 8,636,393

Notes to variances:

  1. Movement due to differences in the forecast value of investment properties.
  2. ​Movements primarily due to changes in assumptions used for asset revaluations and reductions in the capital expenditure programme in the 2014/15 Annual Plan and the 2015–25 Long-term Plan.
  3. Increase due to revenue received in advance relating to the housing upgrade project.
  4. Reclassification of borrowings between current and non-current borrowings.
  5. Weathertight homes provision decreasing over time due to reduction in the number of outstanding claims.

Prospective Statement of Changes In EquityTop

  2014/15
AP
$000
2015/16
LTP
$000
Variance
to LTP
$000
Notes 2016/17
LTP
$000
2017/18
LTP
$000
2018/19
LTP
$000
2019/20
LTP
$000
2020/21
LTP
$000
2021/22
LTP
$000
2022/23
LTP
$000
2023/24
LTP
$000
2024/25
LTP
$000
                           
EQUITY - OPENING BALANCES                          
Accumulated funds and retained earnings 4,965,881 4,972,119 6,238   4,994,681 5,014,552 5,028,194 5,043,158 5,057,910 5,075,336 5,091,379 5,109,225 5,127,341
Revaluation reserves 1,685,991 1,429,106 (256,885)   1,429,106 1,652,379 1,725,376 1,725,376 1,966,504 2,071,370 2,071,370 2,407,276 2,549,921
Hedging reserve (9,955) 137 10,092   137 137 137 137 137 137 137 137 137
Fair value through other comprehensive revenue and expense reserve 93 63 (30)   63 63 63 63 63 63 63 63 63
Restricted funds 10,715 12,389 1,674   12,928 13,424 13,865 14,237 14,540 14,774 14,922 14,984 14,951
TOTAL EQUITY - Opening balance 6,652,725 6,413,814 (238,911)   6,436,915 6,680,555 6,767,635 6,782,971 7,039,154 7,161,678 7,177,871 7,531,685 7,692,413
                           
CHANGES IN EQUITY                          
                           
Retained earnings                          
Net surplus for the year 26,385 23,101 (3,284)   20,367 14,083 15,336 15,055 17,658 16,193 17,908 18,083 17,118
Transfer to restricted funds (3,766) (4,518) (752)   (4,555) (4,598) (4,637) (4,685) (4,734) (4,790) (4,845) (4,911) (7,026)
Transfer from restricted funds 3,765 3,979 214   4,059 4,157 4,265 4,382 4,502 4,640 4,783 4,944 5,113
                           
Hedging reserve                          
Movement in hedging reserve 57,073 - (57,073)   223,273 72,997 - 241,128 104,866 - 335,906 142,645 -
                           
Restricted Funds                          
Transfer to retained earnings (3,765) (3,979) (214)   (4,059) (4,157) (4,265) (4,382) (4,502) (4,640) (4,783) (4,944) (5,113)
Transfer from retained earnings 3,766 4,518 752   4,555 4,598 4,637 4,685 4,734 4,790 4,845 4,911 7,026
                           
TOTAL COMPREHENSIVE REVENUE AND EXPENSE 83,458 23,101 (60,357)   243,640 87,080 15,336 256,183 122,524 16,193 353,814 160,728 17,118
                           
EQUITY - CLOSING BALANCES                          
Accumulated funds and retained earnings 4,992,265 4,994,681 2,416   5,014,552 5,028,194 5,043,158 5,057,910 5,075,336 5,091,379 5,109,225 5,127,341 5,142,546
Revaluation reserves 1,743,064 1,429,106 (313,958)   1,652,379 1,725,376 1,725,376 1,966,504 2,071,370 2,071,370 2,407,276 2,549,921 2,549,921
Hedging reserve (9,955) 137 10,092   137 137 137 137 137 137 137 137 137
Fair value through other comprehensive revenue and expense 93 63 (30)   63 63 63 63 63 63 63 63 63
Restricted funds 10,716 12,928 2,212   13,424 13,866 14,237 14,540 14,772 14,922 14,984 14,951 16,864
                           
TOTAL EQUITY - Closing balance 6,736,183 6,436,915 (299,268)   6,680,555 6,767,635 6,782,971 7,039,154 7,161,678 7,177,871 7,531,685 7,692,413 7,709,531

Prospective Statement of Cash FlowsTop

  2014/15
AP
$000
2015/16
LTP
$000
Variance
to LTP
$000
Notes 2016/17
LTP
$000
2017/18
LTP
$000
2018/19
LTP
$000 
2019/20
LTP
$000
2020/21
LTP
$000
2021/22
LTP
$000
2022/23
LTP
$000
2023/24
LTP
$000
2024/25
LTP
$000
CASH FLOWS FROM OPERATING ACTIVITIES                          
                           
Receipts from rates - Council 255,266 259,728 4,462   283,407 301,716 323,735 338,016 355,482 370,042 384,666 403,046 414,496
Receipts from rates - Greater Wellington Regional Council 50,341 53,018 2,677   55,597 59,243 63,628 66,336 69,690 72,483 75,390 78,980 81,140
Receipts from activities and other income 123,013 136,363 13,350 1 106,809 128,001 133,236 136,825 138,879 139,749 143,249 146,468 149,880
Receipts from grants and subsidies - operating 7,715 36,026 28,311 2 35,376 21,637 15,186 12,885 13,768 14,154 14,459 14,723 15,600
Receipts from grants and subsidies - capital 43,375 6,485 (36,890)   6,686 6,941 6,261 6,386 6,564 6,721 6,882 7,050 7,226
Receipts from investment property lease rentals 9,215 9,135 (80)   9,135 9,135 9,135 9,135 9,135 9,135 9,135 9,135 9,135
Cash paid to suppliers and employees (286,780) (294,178) (7,398)   (293,143) (294,304) (304,532) (312,916) (320,607) (331,300) (341,931) (352,466) (364,348)
Rates paid to Greater Wellington Regional Council (50,341) (53,018) (2,677)   (55,597) (59,243) (63,628) (66,336) (69,690) (72,483) (75,390) (78,980) (81,140)
Grants paid (28,719) (35,583) (6,864)   (43,827) (42,806) (35,654) (38,197) (41,750) (44,354) (44,803) (45,303) (45,825)
                           
NET CASH FLOWS FROM OPERATING ACTIVITIES 123,085 117,976 (5,109)   104,443 130,320 147,367 152,134 161,471 164,147 171,657 182,653 186,164
                           
CASH FLOWS FROM INVESTING ACTIVITIES                          
                           
Dividends received 11,000 11,000 -   11,000 11,100 10,500 11,500 14,209 17,558 17,502 20,047 21,294
Interest received 44 637 593   650 663 719 693 731 776 827 886 952
Proceeds from sale of property, plant and equipment 4,050 2,650 (1,400)   (4,600) 5,250 2,000 2,000 2,000 2,000 2,000 2,000 2,000
Purchase of intangibles (8,777) (11,195) (2,418)   (8,418) (11,493) (6,101) (6,201) (6,533) (8,953) (6,711) (6,892) (7,451)
Purchase of property, plant and equipment (155,724) (146,857) 8,867   (152,301) (181,542) (170,922) (133,955) (146,032) (213,033) (166,620) (161,549) (173,043)
                           
NET CASH FLOWS FROM INVESTING ACTIVITIES (149,407) (143,765) 5,642   (153,669) (176,022) (163,804) (125,963) (135,625) (201,652) (153,002) (145,508) (156,248)
                           
CASH FLOWS FROM FINANCING ACTIVITIES                          
                           
New borrowings 203,964 239,327 35,363   231,267 297,974 313,217 313,914 344,113 417,616 374,142 403,860 429,472
Repayment of borrowings (155,562) (197,932) (42,370)   (155,562) (219,789) (259,762) (301,044) (329,269) (336,064) (343,902) (386,962) (402,929)
Interest paid on borrowings (22,080) (22,763) (683)   (26,422) (32,423) (37,190) (39,253) (40,849) (43,968) (48,392) (54,068) (56,591)
                           
NET CASH FLOWS FROM FINANCING ACTIVITIES 26,322 18,632 (7,690)   49,283 45,762 16,265 (26,383) (26,005) 37,584 (18,152) (37,170) (30,048)
                           
Net increase/(decrease) in cash and cash equivalents - (7,157) (7,157)   57 60 (172) (212) (159) 79 503 (25) (132)
Cash and cash equivalents at beginning of year 2,389 8,406 6,017   1,249 1,306 1,366 1,194 982 823 902 1,405 1,380
                           
CASH AND CASH EQUIVALENTS AT END OF YEAR 2,389 1,249 (1,140)   1,306 1,366 1,194 982 823 902 1,405 1,380 1,248

Notes:

  1. Wellington City Council collects rates on behalf of GWRC.
  2. Increased income from activites is detailed in the Funding Impact Statements by activity.

Prospective Statement of Changes in Restricted FundsTop

  OPENING BALANCE
2015/16
$000
DEPOSITS

$000
EXPENDITURE

$000
CLOSING BALANCE
2024/25
$000
Purpose
SPECIAL RESERVES AND FUNDS          
Reserve purchase and development fund 287 - - 287 Used to purchase and develop reserve areas within the city
Wellington economic initiatives development fund 2,075 32,050 (34,125) -  
Insurance reserve 9,609 17,065 (10,535) 16,139 Allows the Council to meet the uninsured portion of insurance claims
Total special reserves and funds 11,971 49,115 (44,660) 16,426  
           
TRUSTS AND BEQUESTS          
A Graham Trust 3 1 - 4 For the upkeep of a specific area of Karori Cemetery
A W Newton request 315 160 (150) 325 For the benefit of art (Fine Arts Wellington), education (technical and other night schools) and athletics (rowing)
E A McMillan Estate 6 - - 6 For the benefit of the public library
E Pengelly Bequest 13 5 - 18 For the purchase of children's books
F L Irvine Smith Memorial 7 2 - 9 For the purchase of books for the Khandallah Library
Greek NZ Memorial Association 5 2 - 7 For the maintenance and upgrade of the memorial
Kidsarus 2 Donation 3 1 - 4 For the purchase of children's books
Kirkcaldie and Stains Donation 17 - - 17 For the beautification of the BNZ site
QEII memorial Book Fund 19 10 - 29 For the purchase of books on the Commonwealth
Schola Cantorum Trust 6 3 - 9 For the purchase of musical scores
Terawhiti Grant 10 - - 10 To be used for the purchase of library books
Wellington Beautifying Society Request 14 - (14) - Used towards "the Greening of Taranaki Street" project
Total trusts and bequests 418 184 (164) 438  
Total restricted funds 12,389 49,299 (44,824) 16,864  

In addition to the above, the Council is proposing to establish a Forest Carbon Reserve Fund on the basis that it will reinvest a share of revenue from the sale of forestry emission units under the New Zealand Emissions Trading Scheme or Permanent Forest Sink Initiative to protect or enhance the Council’s forest carbon stocks. Other revenues generated from the sale of emission units or from costs recovered by way of fees and charges in regard to the New Zealand Emissions Trading Scheme will be treated as other revenues received by the Council. We are not anticipating any revenue for this fund in the 2015/16 year.