Source - RNS
RNS Number : 7399G
ENW Finance plc
31 May 2017
 

 

 

ENW Finance plc (the "Company") is pleased to announce its Annual Financial Report for theyear ended 31 March 2017.

The Annual Financial Report is available to view on the Company's website: www.enwl.co.uk.

In accordance with the requirements of Listing Rule 17.3.1, a copy of the annual financial report has been submitted to the National Storage Mechanism and will shortly be available forinspection at: http://www.hemscott.com/nsm.do.

In accordance with Disclosure and Transparency Rule 6.3.5 the Annual Financial Report is here reproduced in full unedited text (the Company has not taken advantage of the exemption afforded in 6.3.5 (2)).

For further information please contact Electricity North West's press office on 0844 209 1957 or email [email protected]

 

 

 

 

 

 ENW FINANCE PLC                                 

 

              Annual Report and                                               

  Financial Statements                               

for the year ended 31 March 2017        

 

 

  

 

Contents                                                                                                                           Page

 

Strategic Report                                                                                                                                1

Directors' Report                                                                                                                               2

Directors' Responsibilities Statement                                                                                               3

Independent Auditor's Report                                                                                                            4

Profit and Loss Account                                                                                                                    5

Balance Sheet                                                                                                                                   6

Statement of Changes in Equity                                                                                                       7

Notes to the Financial Statements                                                                                                    8

 

 

  

 

Strategic Report

Business review and principal activities

ENW Finance plc ("the Company") acts as a financing company which has notes in issue and listed on the London Stock Exchange (the "Notes").  The Company is a financing entity within the North West Electricity Networks (Jersey) Limited group (the "Group") and following the issue of Notes, lent the net proceeds to a fellow group subsidiary and affiliated company, Electricity North West Limited ("ENWL").

The Company operates solely as a financing company and therefore there are no non- financial key performance indicators.  A review of the Group's non-financial key performance indicators is disclosed in the Annual Report and Consolidated Financial Statements of the key trading subsidiary. Electricity North West Limited ("ENWL").

Financial performance and key performance indicators

The results for the year are set out in the Profit and Loss Account on page 5.

Profit for the year was £1.6m (2016: £1.6m).

The Company had borrowings, net of cash of £199.2m at 31 March 2017 (2016:  £199.0m) relating to the Notes.  The Notes have a nominal value of £200m at 6.125 per cent, maturing in 2021.  The Company recognises a receivable from ENWL on equivalent terms and equal to the external borrowings.

There are no planned changes in the business activities of the Company.

Principal risks and uncertainties

As the Company's obligations in respect of the Notes and associated intercompany index-linked swap and embedded derivative are met via income receivable from ENWL, the Board considers the principal risks and uncertainties facing the Company to be those that affect ENWL and the larger Group.  The principal trade and activities of the Group are carried out in ENWL and a comprehensive review of the strategy and operating model, the regulatory environment, the resources and principal risks and uncertainties facing that company, and ultimately the Group, are discussed in the Strategic Report of the ENWL Annual Report and Consolidated Financial Statements, which are available on ENWL's website, www.enwl.co.uk. 

The Company has exposure to interest rate risk and inflation risk; the intercompany index-linked swap and embedded derivative are exposed to a risk of change in their fair value arising from a risk of change of future cash flows due to changes in market interest rates and inflation rates.  This exposure is limited as the impact on intercompany index-linked swap (liability) is largely offset by an opposite impact on the embedded derivative (asset).

Going concern

After making enquiries and based on the assumptions, sensitivities and uncertainties outlined above and in note 1, the Directors have concluded that the Company has adequate resources to continue in operational existence for the foreseeable future.  For this reason, they continue to adopt the going concern basis in preparing the financial statements.

Corporate governance

The details of the internal control and risk management systems which govern the Company, in relation to the financial processes, are outlined in the Corporate Governance statements contained in the ENWL Annual Report and Consolidated Financial Statements which are available on the website www.enwl.co.uk.

Fair, balanced and understandable

The Directors have reviewed the Annual Report and Financial Statements at the Board's request, to ensure they are fair, balanced and understandable.  As part of the review of the Annual Report and Financial Statements the Directors have acknowledged the detailed guidance given to contributors to the financial statements.  As part of this process the Directors have taken guidance and advice from the Company's external auditor.

Approved by the Board 26 May 2017 and signed on its behalf by:

 

 

 

 

D Brocksom

Director

 

 

 

 

Directors' Report

The Directors present their Annual Report and the audited Financial Statements of ENW Finance plc for the year ended 31 March 2017.

Dividends

Dividends recognised in the year were £nil (2016: £nil).  The Directors do not propose a final dividend for the year ended 31 March 2017 (2016: £nil).

Directors

The Directors of the Company during the year ended 31 March 2017 are set out below.  Directors were appointed for the whole year and to the date of this report, except where otherwise indicated.

S Johnson (resigned 27 May 2016)
M Walters (resigned 31 January 2017)
C Dowling
D Brocksom
N Mills
P Emery (appointed 27 May 2016)
J Lynch (appointed 31 January 2017)

 

At no time during the year did any Director have a material interest in any contract or arrangement which was significant in relation to the Company's business (2016: same).

Events after the Balance Sheet Date

There have been no significant events after the Balance Sheet date.

Directors' and officers' insurance

The Company maintains an appropriate level of Directors' and officers' insurance whereby Directors are indemnified against liabilities to third parties to the extent permitted by the Companies Act.

Auditor

Each of the persons who are a Director at the date of approval of this report confirms that:

(1)  so far as the Director is aware, there is no relevant audit information of which the Company's auditor is unaware; and

 

(2)  each Director has taken all the steps that they ought to have taken as a Director in order to make themselves aware of any relevant audit information and to establish that the Company's auditor is aware of that information.

This confirmation is given and should be interpreted in accordance with the provisions of s418 of the Companies Act 2006.

Independent auditor

Deloitte LLP has expressed its willingness to continue in office as auditor of the Group. In accordance with section 487 of the Companies Act 2006, Deloitte LLP is deemed to be re-appointed as auditor of the Company.

Registered address

ENW Finance plc

304 Bridgewater Place

Birchwood Park

Warrington

United Kingdom

WA3 6XG

 

Registered number: 06845434

 

Approved by the Board on 26 May 2017 and signed on its behalf by:

 

 

 

 

D Brocksom

Director

 

 

 

Directors' Responsibilities Statement

The Directors are responsible for preparing the Annual Report and the Financial Statements in accordance with applicable law regulations.

Company law requires the Directors to prepare financial statements for each financial year.  Under the law Directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and Applicable Law), including FRS 101 'Reduced Disclosure Framework'.  Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.  In preparing these financial statements, the Directors are required to:

·       select suitable accounting policies and then apply them consistently;

 

·       make judgements and accounting estimates that are reasonable and prudent;

 

·       state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

 

·       prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue business.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements comply with the Companies Act 2006.

They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website.  Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation of other jurisdictions.

 

 

Independent Auditor's Report to the Members of ENW Finance plc

We have audited the financial statements of ENW Finance plc for the year ended 31 March 2017 which comprise the Profit and Loss Account, the statement of Changes in Comprehensive Income, the Balance Sheet, the Statement of Changes in Equity, and the related notes 1 to 17.  The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including FRS 101 'Reduced Disclosure Framework'.

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006.  Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose.  To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Respective responsibilities of directors and auditor

As explained more fully in the Directors' Responsibilities Statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view.  Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland).  Those standards require us to comply with the Auditing Practices Board's Ethical Standards for Auditors.

Scope of audit of the financial statements

An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error.  This includes an assessment of: whether the accounting policies are appropriate to the company's circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the directors; and the overall presentation of the financial statements.  In addition, we read all the financial and non-financial information in the annual report to identify material inconsistencies with the audited financial statements and to identify any information that is apparently materially incorrect based on, or materially inconsistent with, the knowledge acquired by us in the course of performing the audit.  If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report.

Opinion on financial statements

In our opinions the financial statements:

·       give a true and fair view of the state of the company's affairs as at 31 March 2017 and of its profit for the year then ended;

·       have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

·       have been prepared in accordance with the requirements of the Companies Act 2006.

Opinion on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

·       the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

·       the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified any material misstatements in the Strategic Report and the Directors' Report.

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

·       adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

·       the financial statements are not in agreement with the accounting records and returns; or

·       certain disclosures or directors' remuneration specified by law are not made; or

·       we have not received all the information and explanations we require for our audit.

 

Jane Boardman BSc FCA (Senior statutory auditor)

For and on behalf of Deloitte LLP

Chartered Accountants and Statutory Auditor

Manchester, United Kingdom

 

26 May 2017

 

 

Financial Statements

 

Profit and Loss Account

for the year ended 31 March 2017

 

 

 

Note

 

2017

£'000

 

2016

£'000

 

 

 

 

 

 

Operating profit

3

 

-

 

-

 

 

 

 

 

 

Interest receivable and similar income

5

 

12,809

 

12,831

 

 

 

 

 

 

Interest payable and similar charges

6

 

(10,671)

 

(10,799)

 

 

 

 

 

 

 

 

Profit on ordinary activities before tax

 

 

2,138

 

2,032

 

 

 

 

 

 

Taxation

7

 

(511)

 

(463)

 

 

 

 

 

 

 

 

Profit for the financial year

 

 

1,627

 

1,569

 

 

 

 

 

 

 

 

All the results shown in the Profit and Loss Accounts for the current year and preceding year, derive from continuing operations.

There are no other items of comprehensive income for the current year or preceding year, other than the results shown above, and therefore no separate Statement of Comprehensive income has been presented.

 

 

 

 

Balance Sheet

as at 31 March 2017

 

 

 

 

Note

 

2017

£'000

 

2016

£'000

ASSETS

 

 

 

 

 

Non-current assets

 

 

 

 

 

Derivative financial instruments

8,12

 

310,728

 

257,201

Intercompany loan

8

 

219,686

 

219,533

 

 

 

530,414

 

476,734

 

 

 

 

 

 

Current assets

 

 

 

 

 

Debtors: due within one year

9

 

6,052

 

5,646

Cash at bank and in hand

10

 

12

 

12

 

 

 

6,064

 

5,658

 

 

 

 

 

 

Total assets

 

 

536,478

 

482,392

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

Current liabilities

 

 

 

 

 

Creditors: Amounts falling due within one year

13

 

(5,971)

 

(5,575)

 

 

 

 

 

 

Net current assets

 

 

93

 

83

 

 

 

 

 

 

Total assets less current liabilities

 

 

530,507

 

476,817

 

 

 

 

 

 

Non-current liabilities

 

 

 

 

 

Borrowings

11

 

(199,186)

 

(199,033)

Derivative financial instruments

12

 

(318,943)

 

(267,148)

Deferred Tax

14

 

(1,156)

 

(1,041)

 

 

 

(519,285)

 

(467,222)

 

 

 

 

 

 

Total liabilities

 

 

(525,256)

 

(472,797)

 

 

 

 

 

 

Net assets

 

 

11,222

 

9,595

 

 

 

 

 

 

Capital and reserves

 

 

 

 

 

Called up share capital

15

 

13

 

13

Profit and loss account

 

 

11,209

 

9,582

Total shareholders' funds

 

 

11,222

 

9,595

 

 

 

 

 

 

The financial statements of ENW Finance plc (registered number 068745434) were approved and authorised for issue by the Board of Directors on 26 May 2017 and signed on its behalf by:

 

 

 

D Brocksom

Director

 

 

 

Statement of Changes in Equity

for the year ended 31 March 2017

 

 

 

Called-up share capital

 

£'000

Profit and loss account

 

£'000


Total Equity

 

£'000

 

 

 

 

At 1 April 2015

13

8,013

8,026

 

 

 

 

Profit and total comprehensive income for the year

-

1,569

1,569

 

 

 

 

 

 

 

 

At 31 March 2016

13

9,582

9,595

 

 

 

 

Profit and total comprehensive income for the year

-

1,627

1,627

 

 

 

 

 

 

 

 

At 31 March 2017

13

11,209

11,222

 

 

 

 

 

 

 

Notes to the Financial Statements

ENW Finance plc is a company incorporated in the United Kingdom under the Companies Act 2006.

The principal policies adopted in the preparation of the financial statements are set out below:

Basis of preparation

The Company has adopted Financial Reporting Standard 101 'Reduced Disclosure Framework'  ("FRS 101"), on the basis that it meets the definition of qualifying entity under Financial Reporting Standard 100 'Application of Financial Reporting Requirements' ("FRS 100") and the financial statements have therefore been prepared in accordance with FRS 101 as issued by the Financial Reporting Council.

As permitted by FRS 101, for both periods presented, the Company has taken advantage of the disclosure exemptions available under the standard in relation to financial instruments, capital management, presentation of cash flow statement, standards not yet effective and related party transactions with other wholly-owned members of the Group.

Where relevant, equivalent disclosures are given in the consolidated financial statements of North West Electricity Networks plc, the Company's immediate parent; the consolidated financial statements of North West Electricity Networks plc are available to the public and can be obtained as set out in Note 17.

The financial statements have been prepared on the historical cost basis except for the valuation of derivative financial instruments, and are presented in sterling, which is also the functional currency.  All values are rounded to the nearest thousand pounds (£'000) except where otherwise stated.

All Company operations arise from its activities as a financing company in the North West of England. Accordingly, only one operating and geographic segment is reviewed by the Chief Executive Officer and Executive Team.

Basis of preparation - going concern basis

The performance, financial position and principal risks and uncertainties impacting the Company are detailed in the Strategic Report on page 1.  The Company is ultimately a subsidiary of North West Electricity Networks (Jersey) Limited, the key trading subsidiary in the Group is ENWL.  As the Company's obligations in respect of the listed debt are met via income receivable from ENWL, the Board considers the principal risks and uncertainties facing the Company to be those that affect the larger Group.

In consideration of this, the Directors of this Company are cognisant of the going concern disclosure which appears in the financial statements of both North West Electricity Networks (Jersey) Limited and ENWL for the year ended 31 March 2017, the latter of which is available on the website www.enwl.co.uk.

Consequently, after making the appropriate enquiries, the Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future.  Accordingly, it is appropriate to adopt the going concern basis in preparing the Annual Report and Financial Statements.

Basis of preparation - adoption of new and revised standards

The Directors are not aware of any new or revised Standards or Interpretations which have impacted these financial statements.

 

Notes to the Financial Statements (continued)

 

1.         Significant accounting policies (continued)

Operating result

Operating result is stated after charging operating expenses but before investment income, net finance expense and other gains and losses.

Taxation         

The tax expense represents the sum of current and deferred tax charges for the financial year, adjusted for prior year items.

Current taxation

Current tax is based on taxable profit for the year and is calculated using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.  Taxable profit differs from the net profit as reported in the Profit and Loss Account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible.

Deferred taxation

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit and is accounted for using the balance sheet liability method.  Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised.  Such assets and liabilities are not recognised if the temporary difference arises from the initial recognition of goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit. 

Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries, except where the Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. 

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised based on tax rates and laws that have been enacted or substantively enacted at the balance sheet date. 

The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.  Deferred tax is charged or credited in the Profit and Loss Account, except when it relates to items charged or credited in other comprehensive income, in which case the deferred tax is also dealt with in other comprehensive income. 

Financial Instruments

Financial assets and financial liabilities are recognised in the Company's Balance Sheet when the Company becomes a party to the contractual provisions of the instrument.

Debtors

Debtors are stated at their nominal value, less any allowances made for any estimated irrecoverable amounts.

 

 

Notes to the Financial Statements (continued)

 

1          Significant accounting policies (continued)

Creditors

Creditors are stated at their nominal value.

Financial liabilities and equity

Debt and equity instruments are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangement.

Equity instruments

An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by the Company are recognised at the proceeds received, net of direct issue costs.

Financial assets

All financial assets are recognised and derecognised on a trade date basis where the purchase or sale of a financial asset is under a contract whose terms require delivery of the financial asset within the timeframe established by the market concerned, and are initially measured at fair value, plus transaction costs, except for those financial assets classified as at fair value through profit or loss when the transactions costs are recognised immediately in profit or loss. 

Financial assets are classified in to the following specific categories: financial assets 'at fair value through profit or loss' (FVTPL), and 'loans and receivables'.  The classification depends on the nature and purpose of the financial assets and is determined at the time of the initial recognition.

Effective interest method

The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating interest income over the relevant period.  The effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the debt instrument, or, where appropriate, a shorter period, to the net carrying amount on initial recognition. 

Income is recognised on an effective interest basis for debt instruments other than those financial assets classified as at FVTPL. 

Financial Liabilities

Financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs.

Financial liabilities are subsequently measured at amortised cost using the effective interest rate method other than those financial liabilities classified as at FVTPL, which are subsequently measured at fair value.

The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating interest expense over the relevant period.  The effective interest rate is the rate that exactly discounts estimated future cash payments (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the debt instrument, or, where appropriate, a shorter period, to the net carrying amount on initial recognition.

The Company derecognises financial liabilities when, and only when, the Company's obligations are discharged, cancelled or they expire.

Notes to the Financial Statements (continued)

 

1          Significant accounting policies (continued)

Borrowing costs and interest income

All borrowing costs and interest income are recognised in profit or loss in the period in which they are incurred. 

Derivative financial instruments

Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently re-measured to their fair value at each balance sheet date.  The resulting gain or loss is recognised in profit or loss immediately; the Company does not currently designate derivatives into hedging relationships and apply hedge accounting. 

A derivative with a positive fair value is recognised as a financial asset whereas a derivative with a negative fair value is recognised as a financial liability.  A derivative is presented as a non-current asset or a non-current liability if the remaining maturity of the instrument is more than 12 months and it is not expected to be realised or settled within 12 months.  Other derivatives are presented as current assets or current liabilities. 

2.         Critical accounting judgements and key sources of estimation uncertainty

In the application of the Company's accounting policies, which are described in note 1, the Directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources.  The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant.  Actual results may differ from these estimates. 

The estimates and underlying assumptions are reviewed on an ongoing basis.  Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period; or in the period of the revision and future periods if the revision affects both current and future periods. 

The following policies are those critical judgements which the Company believes have the most significant impact on the annual results under FRS 101.

Impairment of financial assets

Financial assets, other than those at FVTPL, are assessed for indicators of impairment at each Balance Sheet date.  Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated cash flows of the investment have been affected.

Fair values of derivative financial instruments

In estimating the fair value of derivative financial instruments, the Company uses market-observable data to the extent it is available.  Where such data is not available, certain estimates regarding inputs to the valuation are required to be made.  Information about the valuation techniques and inputs used are disclosed in note 12. 

 

 

 

Notes to the Financial Statements (continued)

 

3.         Operating Profit

Audit fees payable to Deloitte LLP of £6,910 for the year (2016: £6,908) were borne by another Group company and have not been recharged (2016: same).  There were no non-audit fees payable to the auditor in the year (2016: £nil).

 

4.         Directors and employees

The Company had no employees during the year (2016: same).  Directors' costs are borne by another Group company and cannot be fairly apportioned to the Company (2016: same).

 

5.         Interest receivable and similar income

 

 

 

 

2017

£'000

 

2016

£'000

 

 

 

 

 

 

Interest receivable from Group companies

 

 

12,809

 

12,831

 

 

 

 

 

 

 

 

 

6.         Interest payable and similar charges

 

 

 

 

2017

£'000

 

2016

£'000

Interest payable

 

 

 

 

 

Interest payable on borrowings held at amortised cost

 

 

12,403

3

 

12,424

 

 

 

 

 

 

Fair value gains on financial instruments at fair value through profit or loss

 

 

 

 

 

 

 

 

 

 

 

Derivatives

 

 

(1,732)

 

(1,625)

 

 

 

 

 

 

 

 

Net interest payable and similar charges

 

 

10,671

 

10,799

 

 

 

 

 

 

 

 

 

 

 

Notes to the Financial Statements (continued)

 

7.         Taxation

 

 

 

 

2017

£'000

 

2016

£'000

 

 

 

 

 

 

Current Tax:

 

 

 

 

 

UK corporation tax

 

 

396

 

397

 

 

 

 

 

 

Deferred tax (Note 13):

 

 

 

 

 

Current year

 

 

173

 

66

Prior year

 

 

(58)

 

-

 

 

 

 

 

 

 

 

 

 

 

511

 

463

 

 

 

 

 

 

 

 

 

Corporation tax is calculated at 20% (2016: 20%) of the estimated assessable profit for the year.

Deferred tax is calculated using the rate at which it is expected to reverse.

The table below reconciles the notional tax charge at the UK corporation tax rate to the effective tax rate for the year:

 

 

 

 

 

2017

£'000

 

2016

£'000

 

 

 

 

 

 

Profit before tax

 

 

2,138

 

2,032

 

 

 

 

 

 

 

 

Tax at the UK corporation tax rate of 20% (2016: 20%)

 

 

428

 

406

Non-taxable expenses

 

 

172

 

172

Impact from change in future tax rates

 

 

(31)

 

(115)

Prior year tax adjustment

 

 

(58)

 

-

 

 

 

 

 

 

 

 

 

 

 

511

 

463

 

 

 

 

 

 

 

 

 

 

Notes to the Financial Statements (continued)

 

8.         Debtors due after one year

 

 

 

 

2017

£'000

 

2016

£'000

 

 

 

 

 

 

Amounts falling due after one year:

 

 

 

 

 

Amounts due from Group companies

 

 

219,686

 

219,533

Derivative financial instruments (note 12)

 

 

310,728

 

257,201

 

 

 

 

 

 

 

 

 

 

 

530,414

 

476,734

 

 

 

 

 

 

 

 

On 21 July 2009 the Company lent Electricity North West Limited proceeds of £198.2m in relation to the Notes issue of £200.0m at 6.125 per cent fixed rate due in 2021, net of discount on issue, on terms aligned to the terms of the external Notes (see Note 11) and associated intercompany hedging arrangements.  The carrying value of the receivable reflects the amortisation of the discount.

 

9.         Debtors due within one year

 

 

 

 

2017

£'000

 

2016

£'000

 

 

 

 

 

 

Amounts falling due within one year:

 

 

 

 

 

Amounts due from Group companies

 

 

6,052

 

5,646

 

 

 

 

 

 

 

 

 

10.       Cash at bank and in hand

 

 

 

 

2017

£'000

 

2016

£'000

 

 

 

 

 

 

Cash at bank and in hand

 

 

12

 

12

 

 

 

 

 

 

 

 

 

 

 

Notes to the Financial Statements (continued)

 

11.       Borrowings

This note provides information about the contractual terms of the Company's loans and borrowings.  For more information about the Company's exposure to interest rate risk and liquidity risk, see Note 12.  For more information about the Group's financial risk management and exposure to credit risk, liquidity risk and market risk refer to the NWEN plc consolidated financial statements.

 

 

 

 

2017

£'000

 

2016

£'000

 

 

 

 

 

 

Borrowings measured at amortised cost

 

 

 

 

 

6.125% £200m bond maturing in 2021

 

 

199,186

 

199,033

 

 

 

 

 

 

 

 

The Company has issued £200.0m 6.125 per cent fixed rate Notes due 2021, guaranteed by ENWL (2016: same).

Borrowing facilities

The Company had no unutilised committed bank facilities at 31 March 2017 (2016: same). There was no formal bank overdraft facility in place at 31 March 2017 (2016: same).

 

12.       Financial instruments

Categories of financial instruments

 

 

 

 

2017

£'000

 

2016

£'000

 

 

 

 

 

 

Financial assets at FVTPL:

 

 

 

 

 

Derivative financial instruments

 

 

310,728

 

257,201

 

 

 

 

 

 

 

 

Financial liabilities at FVTPL:

 

 

 

 

 

Derivative financial instruments

 

 

(318,943)

 

(267,148)

 

 

 

 

 

 

 

 

Profit for the year has been arrived at after (crediting)/charging:

 

 

 

 

2017

£'000

 

2016

£'000

 

 

 

 

 

 

Financial assets at FVTPL:

 

 

 

 

 

Derivative financial instruments

 

 

(53,527)

 

(11,572)

 

 

 

 

 

 

 

 

Financial liabilities at FVTPL:

 

 

 

 

 

Derivative financial instruments

 

 

51,795

 

9,947

 

 

 

 

 

 

 

 

Net credit to Profit and Loss Account (Note 6)

 

 

(1,732)

 

(1,625)

 

 

 

 

 

 

 

 

Notes to the Financial Statements (continued)

 

12.       Financial instruments (continued)

Valuation techniques and assumptions applied for the purpose of measuring fair values

The fair values of derivative financial instruments are determined by a discounted cash flow technique using the applicable yield curve for the duration of the instruments.  An adjustment for the relevant credit risk is then made.

Financial risk management

Disclosure around the Company's risk management policies, which are the same as the Group's, can be found in NWEN plc's consolidated financial statements.

 

13.       Creditors: amounts falling due in one year

 

 

 

 

2017

£'000

 

2016

£'000

 

 

 

 

 

 

Accrued interest

 

 

2,378

 

2,378

Corporation tax

 

 

3,593

 

3,197

 

 

 

 

 

 

 

 

 

 

 

5,971

 

5,575

 

 

 

 

 

 

 

 

 

14.       Deferred Tax

The following are the deferred tax liabilities recognised by the Company, and the movements thereon during the current and prior year.

 

 

 

2017

£'000

 

2016

£'000

 

 

 

 

 

At 1 April 2016

 

1,041

 

975

Charges to the profit and loss account (Note 7)

 

115

 

66

 

 

 

 

 

 

 

 

At 31 March 2017

 

1,156

 

1,041

 

 

 

 

 

 

 

 

The deferred tax arises on certain financing items, primarily on the derivatives.

There are no unrecognised deferred tax assets or liabilities in either the current or prior year.

 

 

Notes to the Financial Statements (continued)

 

15.       Called up share capital

 

 

 

 

2017

£'000

 

2016

£'000

 

 

 

 

 

 

Authorised:

 

 

 

 

 

50,000 ordinary shares of £1 each

 

 

50

 

50

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2017

£'000

 

2016

£'000

Allotted, called up and part paid:

 

 

 

 

 

50,000 ordinary shares of £1 each, of which £0.25 has been called up and paid

 

 

13

 

13

 

 

 

 

 

 

 

 

 

16.       Financial commitments

There are no contracted for but not provided for financial commitments at the year end (2016: none).

 

17.       Ultimate parent undertaking and controlling party

The immediate parent undertaking is North West Electricity Networks plc and the ultimate parent undertaking is North West Electricity Networks (Jersey) Limited, a company incorporated and registered in Jersey.  The address of the ultimate parent company is: 44 Esplanade, St Helier, Jersey JE4 9WG.

The largest group in which the results of the Company are consolidated is that headed by North West Electricity Networks (Jersey) Limited.  The smallest group in which they are consolidated is that headed by North West Electricity Networks plc, a company incorporated and registered in the UK.  The consolidated financial statements of this Group are available to the public and may be obtained from 304 Bridgewater Place, Birchwood Park, Warrington WA3 6XG.

First State Investment Fund Management S.à.r.l. on behalf of First State European Diversified Infrastructure Fund FCP-SIF ('EDIF') and IIF Int'l Holdings GP Ltd ('IIF') have been identified as ultimate controlling parties and are advised by Colonial First State Global Asset Management (a member of the Commonwealth Bank of Australia Group) and JP Morgan Investment Management Inc respectively.    


This information is provided by RNS
The company news service from the London Stock Exchange
 
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