Financial Position Of Power Board

Northern Advocate, 23 May 1941, Page 8

Financial Position Of Power Board

The financial progress of the North Auckland Electric-Power Board during the past year was clearly indicated in the report for the year ended March 31, 1941, presented to the annual meeting of the board at Dargaville yesterday by the secretary (Mr. S. P. Day). The report was presented with pleasure because results were again beyond expectations, showing that the previous rapid expansion of the undertaking had been fully maintained, and demonstrating the soundness of the district from an electrical supply point of view, he stated.

Details of Progress

Consumers . 3747 4282) Total Revenue £62,909 £81,223 “The percentage of certain increases between the year under review and the year ended March 31, 1940, are of considerable interest,” continues the report. “Units sold have increased by 45.2 per cent., sales of electricity have increased by 30.8 per cent., and consumers have increased by 14.3 per cent.

Load Agreement Exceeded

“The agreement with the Public Works Department for a supply of power in connection with the annual amount guaranteed for power purchases commenced from October 1, 1937, and provided as follows: First year, £5740, 667.5 k.v.a.; second year, £B2OO, 975 k.v.a.; third year, £10,660, 1282.5 k.v.a.; fourth year, £13,120, 1590 k.v.a.; fifth year, £16,400, 2000 k.v.a. “After three and a-half years’ operation since the agreement came into force the load in the last quarter ended March 31, 1941, reached 3184 k.v.a., which is 1184 k.v.a. in excess of the load of 2000 k.v.a. required for the fifth year under the terms of the agreement. “The capital expenditure of the board to March 31, 1941, less the writings off dead assets amounts to £308,831, compared with the sum of £267,065 at March 31. 1940. Expenditure upon capital account in each year since the commencement of active operations is as follows: 1936, £9660; 1937, £53,179; 1938, £78,297; 1939, £80,424; 1940, £73,192; 1941, £44,567.

Extension Loans

“Reticulation loan moneys raised and received up to March 31, 1941, amounted to £367,000, and the difference between that amount and the amount of capital expenditure is covered by cash and stocks of material. “During the year the procedure to authorise the raising of a further £50,000 extension loan was completed, and arrangements were made to lift £25.000 of that amount during the incoming year at an interest rate of 3| per cent, for a term of 20 years. The costs 'of raising this loan were very light. “Sufficient moneys have been provided to cover the board’s capital expenditure under present conditions for at least nine months, and authority exists subject to the jssue of the statutory Order-in-Council to raise a further sum of £25,000 when required. Yearly Rate of £*87,000 “The final meter reading for February and March totalled £14,497, which is at the rate of £86,982 per annum, giving a percentage return upon capital expenditure of 28.2 per cent., and upon reticulation loans raised of 23.7 per cent. The revenue from electricity sales during the past year amounted to £75,798. which, less discounts of £5476, gives a net figure of £70,322, and a return upon capital expenditure as at March 31, 1941, of 22.8 per cent

The position of the board’s capital account is deserving of comment. All de'ad assets such as preliminary expenses, interest during contruction and engineering expenses during construction have been entirely eliminated, leaving only live, revenueproducing assets. Outstanding Progress “The position as analysed shows the board has made outstanding progress over the, short period of its active existence, and is now well established. It is possible, of course, that a drastic change could take place in the general economic position through the effects of war and import and export restrictions, but it is also certain that if the board’s stability was in any way threatened it would be in common with every other section of the community, and national measures would have to be taken to meet the emergency.” The report was adopted without dis-, cussion.

The following statistics submitted in the report show the progress which had been made during the past year: Purchase of 1940 1941 Electricity . . £18,797 £25,444 Units purchased 12.907,904 18,920,526 Units sold Sales of 11,314,899 16,428,666 Electricity .. Revenue per £57,933 £75,798 unit sold 1.229d. 1.027d. Trading Profits Net Profit £3387 £2971 for Year .. £12,410 £14,222 Depreciation Reserve Loans Received: £5990 £6201 Reticulation . Writings Off £81,000 £25,000 Dead Assets No. of £8779 £6000