Depreciation blamed for G-MW loss

By Country News

A $100million provision for depreciation has pushed the annual Goulburn-Murray Water financial results to a before-tax deficit of about $118million.

The water authority, which has listed assets of about $5billion, is facing increasing depreciation allowances as more redundant assets are transferred out under the Connections irrigation modernisation project.

The book loss is not expected to have any effect on operations.

Last financial year the authority recorded a turnover of about $211million.

The latest annual report, published in the Victorian Parliament last month, noted a declining number of staff worked for the organisation, which resulted in a lower salaries bill.

Chief financial officer Geoff Cutter said assets were being taken out and written down, and this would continue through the current year.

He said the write-downs would not have any effect on water prices.

G-MW has been able to improve system efficiency, according to the figures in the annual report.

System efficiency reflects the percentage of water diverted into an irrigation area that is recorded through customers’ outlets.

The number has increased from about 80 per cent two yeas ago, to 84.5 per cent. The Rochester district recorded the highest efficiency level at 90 per cent.

The number of full-time-equivalent positions on the staff of G-MW has declined from 747 to 688 across 12 months, partly due to changes in Connections program employment.

The report noted the dairy industry commodity price reduction announced in 2016 continued to affect a significant number of G-MW customers, creating increased trade debtor balance and reduced cash receipts.

The amount owed that is older than 90 days is 30 per cent higher than the value prior to the price crash.

The Connections project has achieved the following milestone targets: 7299 service points installed, 1132km of channel decommissioned, 283Gl of audited water savings made, and 290km of channel remediated.

The corporation had borrowings of $106million at the end of the financial year.