NOTES TO THE FINANCIAL STATEMENTS
22. Financial risk management:// CONTINUED 22.4 Foreign exchange risk Policies
Vector is exposed to foreign exchange risk through its borrowing activities, foreign currency denominated expenditure, and through its Australian subsidiaries. Foreign exchange exposure is primarily managed through entering into derivative contracts. The board of directors requires that all significant foreign currency borrowings and expenditure are hedged into NZD at the time of commitment to drawdown or when the exposure is highly probable. Hence, at balance date there is no significant exposure to foreign currency risk.
22.5 Funding risk Policies
Funding risk is the risk that Vector will have difficulty refinancing or raising new debt on comparable terms to existing facilities. The objective is to spread the concentration of risk so that if an event occurs the overall cost of funding is not unnecessarily increased. Details of borrowings are shown in Note 20. The board of directors has set the maximum amount of debt that may mature in any one financial year.
23. Cash flows://
Reconciliation of net profit/(loss) to net cash flows from/(used in) operating activities
2017 $000
2016 $000
NOTE
Net profit/(loss) for the period
168,871
274,402
Items associated with sale of discontinued operations Gain on sale of discontinued operations classified as investing activities Costs of sale of discontinued operations classified as operating activities Items classified as investing activities Net loss/(gain) on disposal of PPE and software intangibles
–
(166,206)
–
(6,892)
4,348
6
4,312
Non-cash items Depreciation and amortisation
199,566
200,378 (1,102) (2,344) (2,809) 61,422 20,529 (4,505) 271,569
Non-cash portion of interest costs (net) Fair value change on financial instruments Associates (share of net profit/(loss))
(3,824) (1,571) (1,568)
8
14
Impairment
–
9
Increase/(decrease) in deferred tax Increase/(decrease) in provisions
(9,084) (1,312)
182,207
Cash items not impacting net profit/(loss) Payments of amounts in provisions
–
(13,331)
Dividends received from associate Changes in assets and liabilities Trade and other payables
2,000
14
1,500
8,186
24,564
Inventories
(2,049) (11,183) (16,667) (21,713)
845
Trade and other receivables
(25,109) (13,600) (13,300) 352,054
Income tax
Net cash flows from/(used in) operating activities
335,713
111
Vector://AR 17
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