D.17 STATEMENT OF CORPORATE INTENT CONNECTING NEW ZEALAND SCI

Transcription

1 D.17 STATEMENT OF CORPORATE INTENT CONNECTING NEW ZEALAND SCI

2

3 TABLE OF CONTENTS 1. ROLE AND OBJECTIVES Transpower s Role Transpower s Objectives TRANSPOWER S STRATEGY AND BUSINESS ENVIRONMENT Purpose Strategic Themes Regulatory Environment Key Assumptions PERFORMANCE MEASURES AND TARGETS Safety Performance Targets Service Performance Targets Financial Performance Targets Social Responsibility Performance Targets and Actions CAPITAL INVESTMENT AND DIVIDEND POLICY Capital Structure and Investment Dividend Policy and Estimates COMMERCIAL VALUATION OTHER MATTERS Information to be provided to Shareholding Ministers Procedures for Share Subscriptions or Purchases Activities for which Compensation is sought Accounting Policies Other Matters Agreed by the Shareholding Ministers and the Board APPENDIX 1: SUBSIDIARY COMPANIES Our Current Subsidiaries Functions of Subsidiary Companies APPENDIX 2: UPDATES TO PERFORMANCE TARGETS FOR 2015/ Safety Performance Targets Operational Performance Targets Financial Performance Targets Capital Structure and Investment Estimates APPENDIX 3: DEFINITIONS Definition of Safety Performance Targets Definition of Operational Performance Targets Definition of Financial Performance Targets Definitions Relating to Capital Investment APPENDIX 4: SOE PORTFOLIO MEASURES

4 THIS STATEMENT OF CORPORATE INTENT SETS OUT TRANSPOWER S ACTIVITIES, OBJECTIVES AND PERFORMANCE TARGETS FOR THREE YEARS FROM 1 JULY This Statement of Corporate Intent (SCI) is submitted by the Board of Directors of Transpower New Zealand Limited, in accordance with Section 14 of the State-Owned Enterprises Act 1986 (the Act). It sets out the Board s overall intentions and objectives for Transpower New Zealand Limited and its subsidiary companies (the Transpower Group) 1 for the year commencing 1 July 2015 and the following two financial years. The Transpower Group is referred to as Transpower throughout this SCI. 1 The companies that comprise the Transpower Group are listed in Appendix 1. 2

5 1. ROLE AND OBJECTIVES 1.1 Transpower s Role Transpower is central to the New Zealand electricity industry, connecting New Zealanders to their power system through safe, smart solutions for today and tomorrow. Our principal commercial activities are: As grid owner, to reliably and efficiently transport electricity from generators to distributors and large users; and As system operator, to operate a competitive electricity market and deliver a secure power system. We will discuss any significant departure from our principal business activities and/or any proposal that we should enter into significant new business activities in advance with our shareholding Ministers. This process will normally include preparing an updated Statement of Corporate Intent for consideration. 1.2 Transpower s Objectives Our principal objective, as set out in Section 4 of the Act, is to operate as a successful business. Section 4 Objective Our Operations As profitable and efficient as comparable businesses that are not owned by the Crown A good employer Within regulatory and commercial parameters: Deliver and operate a safe, reliable, cost efficient transmission grid that meets the needs of New Zealand electricity consumers now and into the future; Deliver an efficient system operator service that supports competition and provides a reliable and efficient supply of electricity for the long term benefit of consumers; and Pursue business opportunities based on the capabilities and expertise developed through our core business activities. Promote a high level of safety, taking all practicable steps to provide safe working conditions; and Maintain a well-qualified and motivated workforce that we treat fairly and properly in all aspects of recruitment, retention and employment. 3

6 Section 4 Objective Our Operations An organisation that exhibits a sense of social responsibility by having regard to the interests of the community in which it operates and by endeavouring to accommodate or encourage these when able to do so. Build and maintain effective relationships with landowners, occupiers and other community representatives and interest groups affected by our activities; Build and maintain effective relationships with Maori, including acknowledging their interests in land; and Work in partnership with communities to plan, deliver, and operate efficient and effective infrastructure while managing adverse social and environmental impacts of our activities. 4

7 2. TRANSPOWER S STRATEGY AND BUSINESS ENVIRONMENT 2.1 Purpose Consistent with the above objectives our purpose is: We connect New Zealanders to their power system, through safe smart solutions for today and tomorrow 2.2 Strategic Themes The long term strategic themes that underpin all of our initiatives are: Deliver a safe, zero harm workplace; Deliver excellent customer service and stakeholder engagement on a commercial platform; Run an effective electricity market; Plan an enduring grid that delivers smart solutions, cost effectively; Deliver a resilient, cost effective transmission service for our customers; Seek continuous business improvement; and Invest in good people. 2.3 Regulatory Environment As a monopoly provider of transmission and system operator services, regulation has a very significant impact on our business. Commerce Commission The Commerce Commission has responsibility for operating price-quality regulation under Part 4 of the Commerce Act 1986 that aims to ensure we: Have incentives to invest; Have incentives to innovate, to improve efficiency and to provide services at a quality that reflects consumer demands; Share the benefits of efficiency gains with consumers, including through lower prices; and Are limited in our ability to extract excessive profits. In 2014/15 we completed the process of establishing regulatory settings for the five year regulatory control period (RCP2) from 1 April Key outcomes of this process were: 5

8 We have transformed our service measures so they focus on the service outcomes expected by transmission customers, and differentiate between high priority, important, standard, N security 2 and generator sites; After a robust challenge and evaluation process, significant efficiency gains will be required in both capital and operating expenditure to meet approved allowances; RCP2 introduces new, more complex regulatory incentive settings and reporting requirements. We have financial incentives in relation to service performance, delivery of certain asset replacements, and achievement of opex and capex efficiency targets; and Various developments, including a pan-sector change to the methodology for estimating suppliers cost of capital and a reduction in benchmark funding costs, have reduced allowable returns. The transformation of service targets, tightening of expenditure allowances and evolution of incentive settings will reinforce our drive for a step change in our planning and operating processes. Electricity Authority The Electricity Authority has responsibility under the Electricity Industry Act 2010 for promoting competition in, reliable supply by, and efficient operation of, the electricity industry for the long-term benefit of consumers. This includes: Governing the transmission pricing methodology that determines how we recover transmission revenues approved by the Commerce Commission from our customers; Setting grid planning reliability standards; Overseeing commercial and technical requirements for connection to the grid; and Procuring system operation services, governing market arrangements and setting key performance requirements. 2.4 Key Assumptions Our financial plan is based on the key assumptions set out below. KEY ASSUMPTIONS We will hold operating expenditure at $300 million in 2015/16, increasing by 2% on average for the next three years; We will hold base capex 3 at an average of $238 million across the next three years; Regulatory allowances are adjusted for the latest (April 2015) CPI information; System Operator revenue will be based on existing funding arrangements; The Commerce Commission s final decision on recovery of North Island Grid Upgrade (NIGU) expenditure will align with its draft decision; The Commerce Commission will approve large (>$20 million) investments forecast to commence in the plan period; and We will divest some spur assets to electricity distribution businesses. 2 N-security refers to sites that do not have full duplicate supply. 3 Base capex refers to regulated capital expenditure not approved as a major project. Enhancement and development projects of more than $20 million must be individually approved as major projects. 6

9 3. PERFORMANCE MEASURES AND TARGETS We measure our performance against a range of safety, operational, financial and non-financial performance targets. These targets are set out below 4. For reference, a comparison with the prior year performance targets is set out in Appendix Safety Performance Targets We strive to provide a working environment in which there are no fatalities or injuries causing permanent disability. In addition, we continuously seek to reduce the rate at which our activities cause injury. 2014/15 Forecast 2015/16 Budget 2016/17 Plan 2017/18 Plan Number of fatalities or injuries causing permanent disability Total recordable injury frequency rate (TRIFR) Service Performance Targets We have developed new network service targets for the RCP2 period: Grid interruptions targets for frequency (occurrence) and duration of interruptions. Different targets for high priority, important, standard, N-security and generator connection locations. 15 targets in total; and Grid availability targets for the inter-island high-voltage direct current (HVDC) link and for key (i.e. market sensitive) circuits within our high-voltage alternating current (H VAC) networks. Two targets in total. We have a financial incentive to meet or outperform these targets. The incentive can generate a reward or penalty of up to $10 million each year. Our target for the first three years of RCP2 is to achieve a revenue-neutral outcome. We provide a full explanation of the measures and targets in our Annual Regulatory Report 5. We have also defined two measures relating to our system operations role. These are: Market systems unplanned unavailability our market systems support real-time operation of New Zealand s electricity market. Our target is based on reducing unplanned unavailability to 0.07% over time; and 4 Refer to Appendix 3 for definitions of the performance measures 5 See Section 4.4, page 26 7

10 Market information quality we provide information on system conditions to support real-time operation of the electricity market. Our target is to avoid causing a major pricing event ( $1 million) from the provision of incorrect information on system conditions to the electricity market. 2014/ / / /18 Forecast Budget Plan Plan Grid interruptions: Achieve targets for occurrence n/a Achieve targets for duration n/a Grid availability: Achieve targets for HVDC and key HVAC circuits availability n/a Market system unplanned unavailability n/a 0.1% 0.09% 0.08% Major pricing events from provision of incorrect information to market* * Major defined as $1 million and information deemed to be incorrect if it was incorrect at the time it was provided to the market. 3.3 Financial Performance Targets Our five key financial metrics are focussed on: Sustaining our credit rating we track free funds from operations (FFO) to interest cover and FFO to debt. Sustaining our credit rating is important for maintaining good access to capital markets and for achieving favourable credit pricing; Balance sheet strength we hold leverage at a level that provides an efficient return on equity while maintaining resilience to withstand financial shocks; and Returns we measure our return on equity, and overall return on capital employed. Return on capital employed tracks relatively close to the allowable return on our regulated transmission assets (of 6.44% from 1 April 2015), and the impact of RCP2 changes on return on equity is softened due to careful cost control and efficiency gains. 8

11 2014/15 Forecast 2015/16 Budget 2016/17 Plan 2017/18 Plan Free Funds from Operations (FFO) Interest coverage FFO / Debt 15.1% 14.1% 14.6% 14.7% Debt / (net debt + equity) 71% 70% 70% 70% Return on equity 12.4% 11.2% 11.7% 11.0% Return on capital employed 6.8% 6.4% 6.5% 6.3% 3.3 Social Responsibility Performance Targets and Actions We have set a mix of targets and actions relating to our social responsibility performance for the 2015/16 year. Category Environmental Target or Action Hold SF 6 emissions at or below 0.8% of installed nameplate capacity Publish carbon emissions report Improve our Resource Management Act compliance management systems Community Deliver two Community Care funding rounds Deliver tikanga ā-iwi (cultural capability) programme within Transpower 9

12 4. CAPITAL INVESTMENT AND DIVIDEND POLICY 4.1 Capital Structure and Investment Transpower s forecast capital structure at 30 June 2015 and for the following three financial years is set out below. Capital Structure and Investment /15 Forecast 2015/16 Budget 2016/17 Plan 2017/18 Plan Debt ($ million) 3,447 3,407 3,457 3,468 Equity ($ million) 1,427 1,428 1,454 1,468 Capital investment ($ million) Most investment in transmission assets (and assets required to support our transmission service) is recovered through regulated revenues approved by the Commerce Commission under Part 4 of the Commerce Act A key objective of the Act is to ensure that we have incentives to invest. Some investment in transmission assets (forecast to be 8% in the three years from 1 July 2015) is recovered through bilateral contracts with transmission customers. Most of our transmission customers are electricity distribution businesses. Investment in system operation assets is recovered through a bilateral contract with the Electricity Authority. The Electricity Industry Act 2010 identifies Transpower as the system operator, and provides the Electricity Authority with the ability to levy electricity industry participants for the costs of procuring system operator services. We maintain a balanced capital structure and will seek to manage future capital requirements without recourse to equity injection by our shareholder. We will, therefore, maintain access to a wide range of debt capital markets to ensure our investment requirements can be funded efficiently. This requires that we maintain a strong credit rating. We have prudent liquidity management policies, consistent with our credit rating, to ensure we secure sufficient funding ahead of need, and to provide protection against any unexpected deterioration in credit markets. 6 The figures in this table are expressed on the basis of New Zealand International Financial Reporting Standards (IFRS) in accordance with Transpower s Accounting policy. Refer to Appendix 3 for definitions of capital structure and investment measures. 10

13 4.2 Dividend Policy and Estimates We will distribute funds attributable to our shareholder and surplus to our financing and operating requirements to our shareholders. We will determine the level of surplus funds by having regard to: A sustainable financial structure; Interest coverage; Group capital expenditure and working capital requirements; Economic regulation; and Forecast macroeconomic conditions. Subject to the above considerations, we expect distribution to average between 65% and 75% of free cash flow over time, after deduction of maintenance capital expenditure. $ million 2014/15 Forecast 2015/16 Budget 2016/17 Plan 2017/18 Plan Estimated amount to be distributed by dividend Our forecast dividend reduces in 2015/16 as we enter a new regulatory control period with altered revenue-setting rules and with allowable returns based on new (lower) benchmark funding costs. Allowable returns will next be updated in the fourth quarter of 2019/20. We will normally divide dividend payments into an interim dividend paid in March and a final dividend paid in September. In recommending the dividend to be paid to shareholders, we will follow procedures generally adopted by Directors of publicly listed companies, and comply with the requirements of Section 15 of the Act and any notice given by the shareholding Ministers under Section 13 of the Act. 11

14 5. COMMERCIAL VALUATION The Board s estimate of the commercial value of the Crown s investment in Transpower at 30 June 2015 is $1.5 billion. This estimate is based on the methodology illustrated below. In summary, the valuation is based on the present value of forecast RCP2 cash flows plus the present value of forecast book value at 30 June 2020 (i.e. at the end of RCP2). Combining these two components produces an estimated total enterprise value of $5.3 billion, which is close to Transpower s current book value of $5.2 billion. Deducting net debt and deferred tax liabilities of $3.8 billion produces an estimated commercial value of $1.5 billion. The following table sets out key components of the valuation. Component Source Comment Cash flows Closing Book Value (terminal value) Discount factor Financial plan Financial plan RCP2 allowable rate of return Regulatory arrangements support a relatively reliable forecast of cash flows for the RCP2 period. Using the forecast closing book value amounts to assuming the Commerce Commission will allow us to recover our actual weighted average cost of capital (WACC) beyond RCP2 and the size of our business will be steady after RCP2. For simplicity, we assume that a hypothetical purchaser would be comfortable with a return on capital that matches our allowable return. 12

15 Key points are that the valuation: Is assessed as at 30 June 2015; Is on an after-tax basis using nominal future cash flows set out in our business plan; Uses a discount rate of 6.44%, based on the allowable rate of return for our regulated transmission and system operator business; Uses a terminal value based on the forecast book value at 30 June 2020, discounted back to June 2015; Uses business plan cash flows for the RCP2 period, discounted back to June 2015; and Was prepared and peer reviewed internally. The commercial valuation at 30 June 2015 of $1.5 billion compares with $1.6 billion at 30 June The reduction is consistent with changes the Commerce Commission has made to revenue setting rules for the RCP2 period and beyond. 13

16 6. OTHER MATTERS 6.1 Information to be provided to Shareholding Ministers To enable shareholding Ministers to assess the value of their investment in Transpower, any information that would normally be supplied to a controlling private shareholder will be made available. An Annual Report for each financial year, including audited financial statements, will be submitted in accordance with Section 15 of the Act. The Annual Report will: Contain sufficient information to enable an informed assessment to be made of Transpower s operations, including a comparison with the SCI; and State the dividend payable to the Crown for the relevant financial year. We will also submit to shareholding Ministers: Half-yearly reports, in accordance with Section 16 of the Act, and quarterly reports with such details as are necessary to permit an informed assessment of the company's performance during that reporting period; and Our Business Plan and a draft SCI, which will be made available to shareholding Ministers for discussion prior to the commencement of the financial year to which the plan and the SCI relate. We will, in addition, provide other information relating to the affairs of the company requested by the shareholding Ministers pursuant to Section 18 of the Act and in accordance with SOE Continuous Disclosure Rules. Consultation We will, in relation to any single transaction or series of transactions, consult with shareholding Ministers on items outside normal operations and having a material impact on our financial position not contemplated in the Business Plan, including: Any substantial capital investment in activities within the scope of core business; Any substantial expansion of activities outside the scope of core business; Subscription for, or sale of, shares in any company or equity interests in any other organisation which are material, involve significant overseas equity investment or are outside our core business; The sale or other disposal of the whole or any substantial part of the business undertaking; and Where Transpower or its subsidiaries hold 20% or more of the shares in any company or other body corporate (not being a subsidiary of Transpower), they will not sell or otherwise dispose of any shares in that company without first giving written notice to the shareholding Ministers of the intended disposal. 14

17 We will also consult on any specific items included in the Business Plan as agreed with shareholding Ministers from time to time. For the purpose of this document, a substantial investment outside core business would be any transaction or series of transactions resulting in a maximum potential cash outflow in excess of $50 million. 6.2 Procedures for Share Subscriptions or Purchases Subscriptions for shares in any company or interests in any other organisation will, where material, be subject to consultation with shareholding Ministers. 6.2 Activities for which Compensation is sought We will, in accordance with Section 7 of the Act, seek compensation sufficient to allow Transpower's position to be restored if the Government wishes us to undertake activities or assume obligations that in our view will: Result in a reduction of Transpower's profit or net worth; or Modify our assets in ways that reduce ongoing security and reliability. There are currently no activities in relation to which compensation from the Crown. we are seeking, or have sought, 6.3 Accounting Policies Transpower s financial statements are prepared in accordance with the Financial Reporting Act The Financial Reporting Act 1993 requires compliance with generally accepted accounting practice (GAAP) in New Zealand. The financial statements comply with New Zealand Equivalents to International Financial Reporting Standards (NZ IFRS) and other applicable Financial Reporting Standards. The financial statements also comply with International Financial Reporting Standards (IFRS). Transpower is not a public benefit entity for the purposes of NZ IAS 1 Presentation of Financial Statements. The detailed accounting policies applied in the preparation of the financial statements are consistent with the accounting policies disclosed in the 2014/15 Annual Report Other Matters Agreed by the Shareholding Ministers and the Board No other matters have been agreed by the shareholding Ministers and the Board for inclusion in this statement pursuant to section 14(2)(j) of the Act. 7 See 15

18 APPENDIX 1: SUBSIDIARY COMPANIES The terms "share", "shareholding Ministers", and "subsidiary" have the same meanings as in Section 2 of the Act. Transpower will ensure at all times that: Control of the affairs of every subsidiary of Transpower is exercised by a majority of the Directors appointed by Transpower; and A majority of the Directors of every subsidiary of Transpower are persons who are also Directors or employees of Transpower, or who have been approved by the shareholding Ministers for appointment as Directors of the subsidiary. 7.1 Our Current Subsidiaries The Transpower Group contains the subsidiary companies listed in the table below. Name Holding Halfway Bush Finance Limited 100% TB and T Limited 100% Risk Reinsurance Limited 100% 7.2 Functions of Subsidiary Companies Halfway Bush Finance Limited and TB and T Limited were formed during the 2003 cross-border lease transaction which has been unwound and only the head lease agreement remains. These companies are dormant and do not undertake trading activities. Their purpose is to hold assets on behalf of the Transpower Group. Risk Reinsurance Limited is our captive insurance subsidiary. It is the primary insurer on our material damage and cables insurance programmes (both electricity and fibre optic). Risk Reinsurance Limited reinsures a portion of this risk with third party insurers. Risk Reinsurance is registered in the Cayman Islands, but is domiciled in New Zealand for taxation purposes. 16

19 APPENDIX 2: UPDATES TO PERFORMANCE TARGETS FOR 2015/16 The following tables compare the performance targets and measures for the 2015/16 year set out in this SCI with those set out in the previous SCI. 8.1 Safety Performance Targets 2015/16 Safety Performance Targets Previous SCI Current SCI Number of fatalities or injuries causing permanent disability 0 0 Total recorded injury frequency rate (TRIFR) 8 8 Targets are unchanged. 8.2 Operational Performance Targets 2015/16 Operational Performance Targets Previous SCI Current SCI High Voltage Alternating Current (HVAC) circuit availability (%) 98.8 n/a High Voltage Direct Current (HVDC) availability (%) 97.0 n/a Number of loss of supply events of greater than 0.05 System Minutes Number of loss of supply events of greater than one System Minute Material breaches of System Operator Performance Obligations reported to the Electricity Commission 15 n/a 3 n/a < 4 n/a We have included new grid targets in this SCI that align with our revenue-linked targets for the RCP2 period, and improved system operation service targets. 8.3 Financial Performance Targets 2015/16 Financial Performance Targets Previous SCI Current SCI FFO Interest coverage (multiple) Return on capital employed (%) Return on equity (%)

20 Forecast 2015/16 returns have reduced from last year s SCI forecast due to a reduced allowable return set by the Commerce Commission for the RCP2 period. Allowable returns are lower due to lower benchmark funding costs (risk free rate and debt premium), a change in the Commission s methodology for estimating suppliers cost of capital (WACC percentile) and new revenue-setting arithmetic (relating to modelling of intra-year cash-flow timing). 8.4 Capital Structure and Investment Estimates 2015/16 Capital Structure and Investment Previous SCI Current SCI Debt ($ million) 3,578 3,407 Equity ($ million) 1,428 1,428 Ratio of debt to debt plus equity 71% 70% Capital investment ($ million) Estimated amount to be distributed by dividend ($ million) Lower allowable returns for RCP2 impact on the forecast dividend. This is partially mitigated by expenditure efficiencies. We are forecasting lower capital investment, with main changes being lower expectations for customer-funded (non -regulated) investment and lower forecast for large enhancement and development projects. 18

21 APPENDIX 3: DEFINITIONS 9.1 Definition of Safety Performance Targets Number of fatalities or injuries causing permanent disability Number of medical treatment injuries Total recordable injury frequency rate (TRIFR) Number includes fatalities or injuries causing permanent disability for all Transpower s staff and contractors. Number includes medical treatment injuries for all Transpower s staff and contractors. Total number of lost time and medical treatment injuries multiplied by 1,000,000 hours divided by the total number of hours worked in the year 9.2 Definition of Operational Performance Targets Operational performance targets are based on our RCP2 network service targets. Our 2013/14 Annual Regulatory Report sets out detailed definitions Definition of Financial Performance Targets Free Funds from Operations (FFO) to Interest coverage (multiple) Free Funds from Operations (FF O) to Debt (%) Net Debt / Net Debt + Equity (%) Return on capital employed (%) Return on equity (%) Cash Flow from Operations adjusted for changes in working capital plus interest costs and implied depreciation on operating leases, divided by interest costs. Cash Flow from Operations adjusted for changes in working capital plus interest costs and implied depreciation on operating leases, divided by net debt. Net Debt divided by the sum of Net Debt and Equity Net Debt is the face value of debt adjusted for the capitalisation of operating leases. Earnings before interest, tax and changes in the fair value of financial instruments (EBITF) less tax expense (adjusted for interest tax s hield), divided by average capital employed. Capital employed is made up of current assets (excluding derivatives) plus fixed assets (excluding works under construction), less current liabilities (excluding current debt, derivatives, interest payable and income in advance). Profit After Tax (excluding changes in the fair value of financial instruments) divided by average equity (excluding cumulative changes in the fair value of financial instruments). 8 See 19

22 9.4 Definitions Relating to Capital Investment Debt ($ million) Equity ($ million) Capital Investment ($ million) Current and non-current debt and finance leases Share capital, reserves and accumulated retained earnings Total capital expenditure, excluding net property acquisitions/disposals 20

23 APPENDIX 4: SOE PORTFOLIO MEASURES This Appendix sets out performance measures based on standardised reporting and definitions requested by shareholding Ministers for all SOEs. Detailed definitions and a glossary for these measures can be found at These measures are not directly comparable with the measures earlier in this SCI, as the definitions differ (refer footnotes below). 2014/15 Forecast 2015/16 Budget 2016/17 Plan 2017/18 Plan Shareholder Returns Total shareholder return (%) Dividend yield (%) Dividend pay-out (%) Return on equity 9 (%) Return on equity adjusted for IFRS fair value movements and asset revaluations 10 (%) Profitability/Efficiency Return on capital employed 11 (%) Operating margins (%) Leverage/Solvency Gearing ratio (net) (%) Interest cover 12 (x) Solvency (%) Portfolio ratio does not adjust for fair value movements. Our ratio also adjusts the Profit and Loss Statement and equity for fair value. 10 Portfolio ratio only adjusts the Profit and Loss Statement for fair value movements. Our ratio also adjusts equity for fair value. 11 Our calculation adjusts tax for the effect of interest costs. The portfolio ratio excludes tax. 12 Our ratio is based on cash flow from operations rather than EBITDAF. (Earning before interest, tax, depreciation, amortisation and fair value) STATEMENT OF CORPORATE OINTENT 1 July

24