Infratil : FY2024 Parent Full Year Financial Statements

DocuSign Envelope ID: DB65D522-CE78-4466-AD66-F618DF49FA74

Infratil Limited

Statement of Comprehensive Income

For the year ended 31 March 2024

	Notes	2024	2023
		$000	$000
Dividends received from subsidiary companies		-	115,000
Subvention income		-	-
Operating revenue		247,402	240,328
Total revenue		247,402	355,328
Directors' fees		1,515	1,101
Management and other fees	13	215,693	233,862
Other operating expenses	4	30,440	5,988
Total operating expenditure		247,648	240,951
Operating surplus/(loss) before financing, derivatives, realisations and impairments		(246)	114,377
Net gain/(loss) on foreign exchange and derivatives		(18)	29
Net realisations, revaluations and (impairments)		-	71
Financial income	13	326,641	173,937
Financial expenses		(79,948)	(65,626)
Net financing income		246,693	108,311
Net surplus before taxation		246,429	222,788
Taxation expense	6	(2,095)	3,827
Net surplus for the year		244,334	226,615
Total other comprehensive income after tax		-	-
Total comprehensive income for the year		244,334	226,615

The accompanying notes form part of these financial statements.

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DocuSign Envelope ID: DB65D522-CE78-4466-AD66-F618DF49FA74

Infratil Limited

Statement of Changes in Equity

For the year ended 31 March 2024

				Retained
	Notes	Capital	Other reserves	earnings	Total
		$000	$000	$000	$000
Balance as at 1 April 2023		1,050,002	-	242,103	1,292,105
Total comprehensive income for the year
Net surplus for the year		-	-	244,334	244,334
Other comprehensive income after tax
Fair value movements in relation to executive share scheme		-	-	-	-
Total other comprehensive income		-	-	-	-
Total comprehensive income for the year		-	-	244,334	244,334
Contributions by and distributions to owners
Share buyback		-	-	-	-
Shares issued		979,906	-	-	979,906
Shares issued under dividend reinvestment plan		6,746	-	-	6,746
Conversion of executive redeemable shares		-	-	-	-
Reserves transferred from amalgamated company		-	-	-	-
Dividends to equity holders	3	-	-	(149,508)	(149,508)
Total contributions by and distributions to owners		986,652	-	(149,508)	837,144
Balance as at 31 March 2024		2,036,654	-	336,929	2,373,583

Statement of Changes in Equity

For the year ended 31 March 2023

Balance as at 1 April 2022		1,050,002	-	122,408	1,172,410
Total comprehensive income for the year
Net surplus for the year		-	-	226,615	226,615
Other comprehensive income after tax
Fair value movements in relation to executive share scheme		-	-	-	-
Total other comprehensive income		-	-	-	-
Total comprehensive income for the year		-	-	226,615	226,615
Contributions by and distributions to owners
Share buyback		-	-	-	-
Shares issued		-	-	-	-
Shares issued under dividend reinvestment plan		-	-	-	-
Conversion of executive redeemable shares		-	-	-	-
Reserves transferred from amalgamated company		-	-	28,791	28,791
Dividends to equity holders	3	-	-	(135,711)	(135,711)
Total contributions by and distributions to owners		-	-	(106,920)	(106,920)
Balance at 31 March 2023		1,050,002	-	242,103	1,292,105

The accompanying notes form part of these financial statements.

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DocuSign Envelope ID: DB65D522-CE78-4466-AD66-F618DF49FA74

Infratil Limited

Statement of Financial Position

As at 31 March 2024

	Notes	2024	2023
		$000	$000
Cash and cash equivalents		-	-
Prepayments and sundry receivables		3,359	2,233
International Portfolio Incentive fees receivable from subsidiaries	13	158,647	164,132
Advances to subsidiary companies	13	3,246,783	2,005,433
Current assets		3,408,789	2,171,798
International Portfolio Incentive fees receivable from subsidiaries	13	117,430	146,317
Deferred tax	6	24,384	21,690
Investments	13	585,529	585,529
Non-current assets		727,343	753,536
Total assets		4,136,132	2,925,334
Bond interest payable		6,432	4,556
Accounts payable		9,720	6,680
Accruals and other liabilities		5,410	5,788
International Portfolio Incentive fees payable	13	158,647	158,647
Infrastructure bonds	7	156,097	121,954
Total current liabilities		336,306	297,625
International Portfolio Incentive fees payable	13	117,430	146,318
Infrastructure bonds	7	1,076,896	957,368
Perpetual Infratil Infrastructure bonds	7	231,917	231,917
Non-current liabilities		1,426,243	1,335,603

Attributable to shareholders of the Company	2,373,583	1,292,105
Total equity	2,373,583	1,292,105
Total equity and liabilities	4,136,132	2,925,334

Approved on behalf of the Board on 20 May 2024

Director

Director

The accompanying notes form part of these financial statements.

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DocuSign Envelope ID: DB65D522-CE78-4466-AD66-F618DF49FA74

Infratil Limited

Statement of Cash Flows

For the year ended 31 March 2024

	Notes	2024	2023
		$000	$000
Cash flows from operating activities
Cash was provided from:
Dividends received from subsidiary companies		-	115,000
Subvention income		-	-
Interest received		326,641	173,937
Operating revenue receipts		152,009	171,856
		478,650	460,793
Cash was dispersed to:
Interest paid		(75,917)	(63,553)
Payments to suppliers		(145,256)	(169,792)
Taxation (paid) / refunded		(4,789)	(5,206)
		(225,962)	(238,551)
Net cash flows from operating activities	10	252,688	222,242
Cash flows from investing activities
Cash was provided from:
Net movement in subsidiary company loan		-	-
		-	-
Cash was dispersed to:
Net movement in subsidiary company loan		(1,181,350)	(7,298)
		(1,181,350)	(7,298)
Net cash flows from investing activities		(1,181,350)	(7,298)
Cash flows from financing activities
Cash was provided from:
Proceeds from issue of shares		926,653	-
Issue of bonds		277,248	115,919
		1,203,901	115,919
Cash was dispersed to:
Repayment of bonds		(122,104)	(193,696)
Infrastructure bond issue expenses		(3,627)	(1,457)
Repurchase of shares		-	-
Dividends paid	3	(149,508)	(135,710)
		(275,239)	(330,863)
Net cash flows from financing activities		928,662	(214,944)
Net cash movement		-	-
Cash balances at beginning of year		-	-
Cash balances at year end		-	-

Note some cash flows above are directed through an intercompany account. The cash flow statement above has been prepared on the assumption that these transactions are equivalent to cash in order to present the total cash flows of the entity.

The accompanying notes form part of these financial statements.

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DocuSign Envelope ID: DB65D522-CE78-4466-AD66-F618DF49FA74

Infratil Limited

Notes to the Financial Statements

For the year ended 31 March 2024

(1) Accounting policies

(A) Reporting Entity

Infratil Limited ('the Company') is a company domiciled in New Zealand and registered under the Companies Act 1993. The Company is listed on the NZX Main Board ('NZX') and Australian Securities Exchange ('ASX'), and is an FMC Reporting Entity in terms of Part 7 of the Financial Markets Conduct Act 2013.

(B) Basis of preparation

The financial statements have been prepared in accordance with New Zealand Generally Accepted Accounting Practice ('NZ GAAP') and comply with New Zealand equivalents to International Financial Reporting Standards ('NZ IFRS') and other applicable financial reporting standards as appropriate for profit-oriented entities. The presentation currency used in the preparation of these financial statements is New Zealand dollars, which is also the Company's functional currency, and is presented in $ thousands unless otherwise stated. The principal accounting policies adopted in the preparation of these financial statements are set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated. To aid comparability certain balance sheet items have been represented from those reported in prior years to conform to the current year's presentation. Total equity remains unchanged.

The financial statements comprise statements of the following: comprehensive income; financial position; changes in equity; cash flows; significant accounting policies; and the notes to those statements. These are the separate stand alone financial statements of the Parent entity. Reference should be made to the consolidated financial statements of Infratil Group Limited for the Group position. The financial statements are prepared on the basis of historical cost.

Accounting estimates and judgements

The preparation of financial statements in conformity with NZ IFRS requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Future outcomes could differ from those estimates. The principal areas of judgement in preparing these financial statements are set out below.

(a) Valuation of investments

Infratil completes an assessment of the carrying value of investments at least annually and considers objective evidence for impairment on each investment taking into account observable data on the investment, the fair value, the status or context of capital markets, its own view of investment value, and its long term intentions. Infratil notes the following matters which are specifically considered in terms of objective evidence of impairment of its investments, and whether there is a significant or prolonged decline from cost, which should be recorded as an impairment, and taken to profit and loss: any known loss events that have occurred since the initial recognition date of the investments, including its long term investment horizon, specific initiatives which reflect the strategic or influential nature of its existing investment position and internal valuations; and the state of financial markets. The assessment also requires judgements about the expected future performance and cash flows of the investment.

(b) Accounting for income taxes

Preparation of the financial statements requires management to make estimates as to, amongst other things, the amount of tax that will ultimately be payable, the availability of losses to be carried forward and the amount of foreign tax credits that it will receive. Actual results may differ from these estimates as a result of reassessment by management and/or taxation authorities.

(C) Taxation

Income tax comprises both current and deferred tax. Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the balance date, and any adjustment to tax payable in respect of previous years. Deferred tax is recognised in respect of the differences between the carrying amounts of assets and liabilities for financial reporting purposes and the carrying amounts used for taxation purposes.

The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the balance sheet date. A deferred tax asset is recognised only to the extent that it is probable that future taxable profits or deferred tax liabilities will be available within the Company against which the asset can be utilised.

(D) Impairment of assets

At each reporting date, the Company reviews the carrying amounts of its investments and advances, to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where the asset does not generate cash flows that are independent from other assets, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

(E) Borrowings

Borrowings are recorded initially at fair value, net of transaction costs. Subsequent to initial recognition, borrowings are measured at amortised cost with any difference between the initial recognised amount and the redemption value being recognised in profit and loss over the period of the borrowing using the effective interest rate. Fees and other costs incurred in arranging debt finance are capitalised and amortised over the term of the relevant debt facility.

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DocuSign Envelope ID: DB65D522-CE78-4466-AD66-F618DF49FA74

Notes to the Financial Statements

For the year ended 31 March 2024

(F) Foreign currency transactions

Transactions in foreign currencies are translated to the functional currency of the Company at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated to the functional currency at the exchange rate at that date. The foreign currency gain or loss on monetary items is the difference between amortised cost in the functional currency at the beginning of the period, adjusted for interest and payments during the period, and the amortised cost in foreign currency translated at the exchange rate at the end of the period. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are translated to the functional currency at the exchange rate at the date that the fair value was determined. Foreign currency differences arising on translation are recognised in profit or loss.

(G) New standards, amendments and pronouncements not yet adopted by the Company

There are no new standards that are not yet effective that would be expected to have a material impact on the Company, in the current or future reporting periods, and foreseeable future transactions.

(2) Nature of business

The Company is the ultimate parent company of the Infratil Group, owning infrastructure businesses and investments in New Zealand, Australia, the United States, Asia and Europe. The Company is a limited liability company incorporated and domiciled in New Zealand. The address of its registered office is 5 Market Lane, Wellington, New Zealand.

(3) Infratil shares and dividends
Ordinary shares (fully paid)
2024	2023
	Shares	Shares
Total authorised and issued capital at the beginning of the year	723,983,582	723,983,582
Movements during the year:
New shares issued	107,906,405	-
New shares issued under dividend reinvestment plan	677,644	-
Conversion of executive redeemable shares	-	-
Share buyback	-	-
Total authorised and issued capital at the end of the year	832,567,631	723,983,582

All fully paid ordinary shares have equal voting rights and share equally in dividends and equity. At 31 March 2024 the Company held 1,662,617 shares as Treasury Stock (31 March 2023: 1,662,617).

Dividends paid on ordinary shares	2024	2023	2024	2023
		cents per share	cents per share	$000	$000
Final dividend prior year (paid 13 June 2023)	12.50	12.00	91,284	86,878
Interim dividend current year (paid 19 December 2023)	7.00	6.75	58,232	48,869
Dividends paid on ordinary shares	19.50	18.75	149,516	135,747
(4) Other operating expenses
				2024	2023
				$000	$000
Fees paid to the Company auditor			414	264
Administration and other corporate costs			30,026	5,724
Total other operating expenses			30,440	5,988
				2024	2023
Fees paid to the Company auditor			$000	$000
Audit and review of financial statements			376	242
Regulatory audit work			-	-
Other assurance services			38	22
Taxation services			-	-
Other services			-	-
Total fees paid to the Company auditor			414	264

The audit fee includes the fees for both the annual audit of the Group and Company financial statements and the review of the interim financial statements. Other assurance services relate to agreed upon procedure engagements.

(5) Net realisations and (impairments)

At 31 March 2024 the Company reviewed the carrying amounts of loans to Infratil Group companies to determine whether there is any indication that those assets have suffered an impairment loss. The recoverable amount of the asset was estimated by reference to the counterparties' net asset position and ability to repay loans out of operating cash flows in order to determine the extent of any impairment loss. These balances are within the Infratil wholly owned group to entities also controlled either directly or indirectly by Infratil Limited.

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DocuSign Envelope ID: DB65D522-CE78-4466-AD66-F618DF49FA74

Notes to the Financial Statements

For the year ended 31 March 2024

(6) Taxation
		2024		2023
		$000		$000
Surplus before taxation	246,429		222,788
Taxation on the surplus for the period @ 28%	69,000		62,381
Plus/(less) taxation adjustments:
Net realisations and (impairments)	-		-
Net benefit of imputation credits	-		-
Exempt dividends	-		(31,719)
Losses offset within Group	(75,666)		(30,683)
Subvention payment	-		-
Recognition of previously unrecognised deferred tax	-		-
Timing differences not recognised	-		-
Over provision in prior years	2,065		(3,806)
Other permanent differences	6,696		-
Taxation expense	2,095		(3,827)
Current taxation	4,789		5,206
Deferred taxation	(2,694)		(9,033)
		2,095		(3,827)
There was no income tax recognised in other comprehensive income during the period (2023: nil).
		Assets
Recognised deferred tax assets and liabilities
		2024		2023
		$000		$000
Derivatives	-		-
Provisions	-		-
Tax losses carried forward	24,384		21,690
Deferred tax assets	24,384		21,690
		Liabilities
		2024		2023
		$000		$000
Derivatives	-		-
Employee benefits	-		-
Customer base assets	-		-
Provisions	-		-
Tax losses carried forward	-		-
Other items	-		-
Deferred tax liabilities	-		-
		Net Assets/(Liabilities)
		2024		2023
		$000		$000
Derivatives	-		-
Provisions	-		-
Tax losses carried forward	24,384		21,690
Net deferred tax assets/(liabilities)	24,384		21,690

Changes in temporary differences affecting tax expense
	Tax Expense		Other Comprehensive Income
	2024		2023	2024	2023
	$000		$000	$000	$000
Derivatives	-		-	-	-
Provisions	-		-	-	-
Tax losses carried forward	2,694		9,033	-	-
Other items	-		-	-	-
	2,694		9,033	-	-

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DocuSign Envelope ID: DB65D522-CE78-4466-AD66-F618DF49FA74

Notes to the Financial Statements

For the year ended 31 March 2024

(7) Infrastructure Bonds
	2024	2023
	$000	$000
Balance at the beginning of the year	1,311,239	1,388,488
Issued during the year	277,248	115,919
Exchanged during the year	(52,248)	-
Matured during the year	(69,856)	(193,696)
Purchased by Infratil during the year	-	-
Bond issue costs capitalised during the year	(3,628)	(1,457)
Bond issue costs amortised during the year	2,425	2,246
Issue premium amortised during the year	(270)	(261)
Balance at the end of the year	1,464,910	1,311,239
Current	156,097	121,954
Non-current fixed coupon	954,619	835,252
Non-current variable coupon	122,277	122,116
Non-current perpetual variable coupon	231,917	231,917
Balance at the end of the year	1,464,910	1,311,239
Repayment terms and interest rates:
IFT210 maturing in September 2023, 5.25% p.a. fixed coupon rate	-	122,104
IFT230 maturing in June 2024, 5.50% p.a. fixed coupon rate	56,117	56,117
IFT260 maturing in December 2024, 4.75% p.a. fixed coupon rate	100,000	100,000
IFT250 maturing in June 2025, 6.15% p.a. fixed coupon rate	43,413	43,413
IFT300 maturing in March 2026, 3.35% p.a. fixed coupon rate	120,269	120,269
IFT280 maturing in December 2026, 3.35% p.a. fixed coupon rate	156,279	156,279
IFT310 maturing in December 2027, 3.60% p.a. fixed coupon rate	102,403	102,403
IFT320 maturing in June 2030, 5.93% p.a. fixed coupon rate until June 2026	115,919	115,919
IFT330 maturing in July 2029, 6.90% p.a. fixed coupon rate	150,000	-
IFTHC maturing in December 2029, 7.78% p.a. variable coupon rate reset annually on 15 December	123,186	123,186
IFT270 maturing in December 2028, 6.78% p.a. fixed coupon rate	146,250	146,249
IFT340 maturing in March 2031, 7.08% p.a. fixed coupon rate	127,248	-
IFTHA Perpetual Infratil infrastructure bonds	231,916	231,917
less: issue costs capitalised and amortised over term	(8,640)	(7,438)
add: issue premium capitalised and amortised over term	550	821
Balance at the end of the year	1,464,910	1,311,239

Fixed coupon

The fixed coupon bonds the Company has on issue are at a face value of $1.00 per bond. Interest is payable quarterly on the bonds.

Perpetual Infratil infrastructure bonds (IFTHA - 'PIIBs')

The Company has 231,916,000 (31 March 2023: 231,916,000) PIIBs on issue at a face value of $1.00 per bond. Interest is payable quarterly on the bonds. On 15

November 2023 the coupon was set at 7.06% per annum until the next reset date, being 15 November 2024 (2023: 6.45%). Thereafter the rate will be reset annually at 1.50% per annum over the then one year swap rate for quarterly payments, unless Infratil's gearing ratio exceeds certain thresholds, in which case the margin increases. These infrastructure bonds have no fixed maturity date. No PIIBs (2023: nil) were repurchased by Infratil Limited during the year.

IFTHC bonds

The IFTHC bonds the Company has on issue are at a face value of $1.00 per bond. Interest is payable quarterly on the bonds. The coupon for the IFTHC bonds for the 1-year period from (but excluding) 15 December 2023 was fixed at 7.78% per annum (for the 1-year period to 15 December 2023 the coupon was 7.89%). Thereafter the rate will be reset annually at 2.50% per annum over the then one year swap rate for quarterly payments.

IFT270 bonds

The interest rate of the IFT270 bonds was fixed at 4.85% for the first five years and then reset on 15 December 2023 for a further five years. The interest rate for the IFT270 bonds for the period from (but excluding) 15 December 2023 was fixed at 6.78% until the maturity date.

IFT320 bonds

The interest rate of the IFT320 bonds is fixed at 5.93% for the first four years and will then reset on 15 June 2026 for a further four years. The interest rate for the IFT320 bonds for the period from (but excluding) 15 June 2026 until the maturity date will be the sum of the four year swap rate on 15 June 2026 plus a margin of 2.00% per annum.

Throughout the period the Company complied with all debt covenant requirements as imposed by the bond supervisor.

At 31 March 2024 the Infratil Infrastructure bonds (including PIIBs) had a fair value of $1,363.1 million (31 March 2023: $1,203.4 million).

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DocuSign Envelope ID: DB65D522-CE78-4466-AD66-F618DF49FA74

Notes to the Financial Statements

For the year ended 31 March 2024

(8) Financial instruments

The Company has exposure to the following risks due to its business activities and financial policies:

• Credit risk
• Liquidity risk
• Market risk (interest rates and foreign exchange)

The Board of Directors has overall responsibility for the establishment and oversight of the Company's risk management framework. The Board also has a function of reviewing management practices in relation to identification and management of significant business risk areas and regulatory compliance. The Company has developed a comprehensive, enterprise wide risk management framework. Management and Board participate in the identification, assessment and monitoring of new and existing risks. Particular attention is given to strategic risks that could affect the Company.

Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations, resulting in financial loss to the Company. The Company is exposed to credit risk in the normal course of business including those arising from financial derivatives and transactions (including cash balances) with financial institutions. The Company has adopted a policy of only dealing with credit-worthy counterparties, as a means of mitigating the risk of financial loss from defaults. Derivative counterparties and cash transactions are limited to high-credit-quality financial institutions and other organisations in the relevant industry. The Company's exposure and the credit ratings of counterparties are monitored. The carrying amounts of financial assets recognised in the Statement of Financial Position best represent the Company's maximum exposure to credit risk at the reporting date. No security is held on these amounts.

Liquidity risk

Liquidity risk is the risk that assets held by the Company cannot readily be converted to cash to meet the Company's contracted cash flow obligations. Liquidity risk is monitored by continuously forecasting cash flows and matching the maturity profiles of financial assets and liabilities. The Company's approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due and make value investments, under both normal and stress conditions, without incurring unacceptable losses or risking damage to the Company's reputation.

The tables below analyse the financial liabilities by relevant maturity groupings based on the earliest possible contractual maturity date at the year end date. The amounts in the tables below are contractual undiscounted cash flows, which include interest through to maturity. Perpetual Infratil Infrastructure Bond cash flows have been determined by reference to the longest dated Infratil Bond maturity in the year 2031.

	Accounts
	payable,		Perpetual Infratil	Derivative
	accruals and	Infrastructure	Infrastructure	financial
2024	other liabilities	bonds	bonds	instruments	Total
	$000	$000	$000	$000	$000
Balance sheet	132,560	1,239,425	231,917	-	1,603,902
Contractual cash flows	132,560	1,385,891	345,848	-	1,864,299
6 months or less	15,131	30,677	8,187	-	53,995
6 to 12 months	-	30,677	8,187	-	38,864
1 to 2 years	86,984	222,754	16,373	-	326,111
2 to 5 years	30,445	549,243	49,120	-	628,808
5 years +	-	552,540	263,981	-	816,521
2023
Balance sheet	317,433	1,083,878	231,917	-	1,633,228
Contractual cash flows	317,433	1,310,816	339,743	-	1,967,992
6 months or less	171,718	148,881	7,479	-	328,078
6 to 12 months	-	23,572	7,479	-	31,051
1 to 2 years	89,779	47,144	14,959	-	151,882
2 to 5 years	55,936	669,057	44,876	-	769,869
5 years +	-	422,162	264,950	-	687,112

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Notes to the Financial Statements

For the year ended 31 March 2024

Market risk

Interest rates

Interest rate risk is the risk of interest rate volatility negatively affecting the Company's interest expense cash flow and earnings. The Company mitigates this risk by issuing borrowings at fixed interest rates or entering into Interest Rate Swaps to convert a portion of floating rate exposures to fixed rate exposure. Borrowings issued at fixed rates expose the Company to fair value interest rate risk which is managed by the interest rate profile and hedging.

Interest rate sensitivity analysis

The following table shows the impact on post-tax profit and equity of a movement in bond interest rates of 100 basis points higher/lower with all other variables held constant.

	2024	2023
	$000	$000
Profit or loss
100 bp increase	(2,557)	(2,557)
100 bp decrease	2,557	2,557

There would be no material effect on equity.

Foreign currency

The Company has exposure to currency risk on the value of its assets and liabilities denominated in foreign currencies, future investment obligations and future income. Foreign currency obligations and income are recognised as soon as the flow of funds is likely to occur. Decisions on buying forward cover for likely foreign currency investments is subject to the Company's expectation of the fair value of the relevant exchange rate.

Foreign exchange sensitivity analysis

At 31 March 2024, if the New Zealand dollar had weakened/strengthened by 10 percent against foreign currencies, with all other variables held consistent, post- tax profit would not have been materially different. There would have been no material impact on balance sheet components.

Fair values

The carrying amount of financial assets and financial liabilities recorded in the financial statements is their fair value, with the exception of bond debt held at amortised cost which have a fair value at 31 March 2024 of $1,363.1 million (31 March 2023: $1,203.4 million) compared to a carrying value of $1,464.9 million (31 March 2023: $1,311.2 million).

Capital management

The key factors in determining the Company's optimal capital structure are:

• Nature of its activities
• Quality and dependability of earnings/cash flows
• Capital needs over the forecast period
• Available sources of capital and relative cost

There were no changes to the Company's approach to capital management during the year.

The Company's capital includes share capital, reserves, and retained earnings. From time to time the Company purchases its own shares on the market with the timing of these purchases dependent on market prices, an assessment of value for shareholders and an available window to trade on the NZX. Primarily the shares are intended to be held as treasury stock and may be reissued under the Dividend Reinvestment Plan or cancelled. During the year, no shares were bought back by the Company (2023: nil).

The Company seeks to ensure that no more than 20% of its Infrastructure bonds mature in any one year period, and to spread the maturities of its facilities. The Company manages its interest rate profile so as to minimise net value volatility. This means having interest costs fixed for extended terms. At times when long rates appear to be unsustainably high, the profile may be shortened, and when rates are low the profile may be lengthened.

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