1、AUSTRALIA S LEADING GAS TRANSPORTATION BUSINESSANNUAL REPORT 2008APA GroupThe cover and pages 1 to 16 of this book have been printed on Impress(Silk).Impress is produced by Australian Paper in Tasmania according to the Highest level of international environmental standards.The mills are certifi ed t
2、o the International standards ISO 14001-environmental management,ISO 9001 quality management and PEFC Chain of Custody(Program for the Endorsement of Forest Certifi cation).All fi bre sourced for the production of Impress comes from sustainably managed sources and a guarantee of no old growth timber
3、.92%of the energy used at our Tasmanian Mills comes from renewable sources providing an environmentally friendly paper with a low carbon footprint.Pages 17 to 144 of this book have been printed on Opal Lite Matt.Opal Lite Matt is an environmentally responsible paper manufactured acid free using Elem
4、ental Chlorine Free(ECF)pulp sourced from sustainable,well managed forests.Its manufacturer is certifi ed under environmental management system ISO 14001.APA Group Annual Report 2008is available on our .auan alternate way to access the Annual Report and help the environment.ANNUAL REPORT 2008APA GRO
5、UPCONTENTSChairman s Report 4Managing Directors Report 6Operations Report 8Board of Directors 14Executive Management 16Corporate Governance Statement 17Financial Reports of:Australian Pipeline Trust andits controlled entities 25APT Investment Trust and its controlled entities 115Additional Informati
6、on IBCAPA GroupAUSTRALIAN PIPELINE LTD ACN 091 344 704 AUSTRALIAN PIPELINE TRUST ARSN 091 678 778 APT INVESTMENT TRUST ARSN 115 585 441ANNUAL MEETINGDATE 30 October 2008VENUE City Recital Hall,Angel Place,SydneyTIME 10:30am Registration commences at 10:00amImage above:Mick Mara and Amol Rampure insi
7、de Compressor Unit 1 building,Culcairn Compressor Station,New South WalesCover image:Case McCaul at APAs gas meter station servicing Incitec Pivot,Gibson Island,QueenslandCONCEIVING PROFITABLE IDEASADDITIONAL INFORMATIONAdditional information required by the Listing Rules of Australian Securities Ex
8、change Limited and not provided elsewhere in this report(the information is applicable as at 1 September 2008).TWENTY LARGEST HOLDERSNo.of Securities%Petronas Australia Pty Ltd62,661,10913.38HSBC Custody Nominees(Australia)Limited30,100,0666.43RBC Dexia Investor Services Australia Nominees Pty Limit
9、ed24,373,9485.21National Nominees Limited 22,402,2824.78East Australian Pipeline Marketing Pty Ltd15,830,5923.38Citicorp Nominees Pty Limited13,532,1272.89JP Morgan Nominees Australia Limited11,851,8882.53Custodial Services Limited6,973,7341.49Invia Custodian Pty Limited4,229,2040.90ANZ Nominees Lim
10、ited3,003,0830.64Queensland Investment Corporation2,992,9260.64Argo Investments Limited2,956,7130.63Cogent Nominees Pty Limited2,900,2360.62Questor Financial Services Limited2,508,8120.54Bond Street Custodians Limited2,259,2040.48Sandhurst Trustees Limited1,875,9500.40Fleet Nominees Pty Limited1,211
11、,8270.26AMP Life Limited1,144,1140.24Milton Corporation Limited764,7090.16Huntley Investment Company Limited707,9770.15Total for top 20214,280,50145.76DISTRIBUTION OF HOLDERSRangesNo.of Holders%No.of Securities%1 1,000 62,95360.1815,417,8273.291,001 5,00027,40126.1966,952,01314.305,001 10,0008,8798.
12、4963,217,42313.5010,001 100,0005,2805.0599,602,74921.27100,001 and over930.09223,051,14247.64Total104,606100.00468,241,154100.0023,857 holders hold less than a marketable parcel of securities(market value less than$500 or 139 securities based on a market price on 1 September 2008 of$3.61).SUBSTANTIA
13、L HOLDERSBy notice dated 19 August 2008,Lazard Asset Management Pacifi c Co advised that it had an interest in 28,936,761 ordinary securities.By notice dated 4 October 2007,Investors Mutual Limited advised that it had an interest in 22,024,197 ordinary securities.By notice dated 22 August 2007,Petro
14、nas Australia Pty Limited advised that it had an interest in 72,102,331 ordinary securities.ON-MARKET BUY-BACKThere is no current on-market buy-back.VOTING RIGHTSOn a show of hands,each holder has one vote.On a poll,each holder has one vote for each dollar of the value of the total interests they ha
15、ve in the scheme.RESPONSIBLE ENTITY AND REGISTERED OFFICEAustralian Pipeline Limited ABN 99 091 344 704HSBC Building Level 19,580 George StreetSydney NSW 2000PO Box R41,Royal Exchange NSW 1225Telephone:+61 2 9693 0000Facsimile:+61 2 9693 .auAPA GROUP REGISTRYLink Market Services LimitedLevel 12,680
16、George StreetSydney NSW 2000Locked Bag A14,Sydney South NSW 1235 Toll Free:1800 992 312Telephone:+61 2 8280 7132Facsimile:+61 2 9287 .au1APA ANNUAL REPORT 08WE DELIVERSTABLE FINANCIAL PERFORMANCE AND GROWTH OPPORTUNITIESENHANCING GAS INFRASTRUCTUREDEVELOPING UNIQUE SOLUTIONSINTEGRATING ASSETSLEVERAG
17、ING KNOWLEDGE AND SKILLSCAPTURING VALUESatya Nand and Mick Maraservicing the mainline valve which feeds gas into Origin Energys power station,Uranquinty,New South WalesPeter McSorleyinspecting Ellengrove Gate Station,which transfers gas from Roma Brisbane Pipeline into APA Gas Network,QueenslandEliz
18、abeth Livingstone(left),discussing commercial aspects of the gas metering station at CS Energys Swanbank power station2APA ANNUAL REPORT 08 Revenue up 68.5%Earnings before interest,tax,depreciation and amortisation(EBITDA)up 45.0%Profi t after tax before signifi cant items(NPAT)up 27.4%Operating cas
19、h fl ow up 27.6%Operating cash fl ow per security up 7.6%Distributions fully funded by operating cash fl ow Achieved target of at least 5%distribution growth Raised$124 million in equity Strengthened balance sheetFINANCIAL HIGHLIGHTSTOTAL REVENUE($M)2004006008009000405060708897.80100700500300EBITDA(
20、$M)01002003004005000405060708430.5DISTRIBUTIONS(CPS)040506070829.524.05.5PROFITCAPITAL051015202530OPERATING CASH FLOW($M)0501001502000405060708192.1TOTAL ASSETS($M)010002000300040005000040506070850976000NPAT($M)020406080100040506070882.2The above refers to underlying results-refer page 26.Delivering
21、 fi nancial stability and growth3APA ANNUAL REPORT 08 Completed the transition from infrastructure owner to operating business Acquired 33%interest in SEA Gas Pipeline,17%interest in Envestra,and the personnel and contracts to operate Envestra s assets Assumed direct control of operating and mainten
22、ance services on APA s foundation pipelines,including personnel,through the termination of third party contracts Commenced expansion of the Moomba Sydney Pipeline,Carpentaria Gas Pipeline,Goldfi eld Gas Pipeline and Victorian Transmission System Commenced construction of the Bonaparte Gas Pipeline C
23、ompleted the 30MW X41 Power Station at Mt Isa Concluded the Access Arrangement on the Victorian Transmission System,providing revenue certainty to 2012OPERATING HIGHLIGHTSEnhancing existing gas infrastructure through organic growthRoma Brisbane PipelineCommenced FEED1 stage of pipeline expansion pro
24、ject following Expression of Interest for additional capacity.APA Gas NetworkCommenced a 3-year program to expand the network to deliver gas to 9,000 new homes.Moomba Sydney Pipeline SystemCommenced FEED1 studies to transport coal seam gas south.Victorian Transmission SystemCommenced FEED1 studies f
25、or moving gas into APAs east coast pipeline system.Completed construction of Brooklyn Lara Pipeline.Moomba Sydney PipelineCommenced 5-year expansion program to increase pipeline capacity to supply new contracts.Carpentaria Gas PipelineConstruction commenced on a new compressor station at Davenport D
26、owns.Pipeline capacity to increase by 15%.Transporting more than half of Australia s domestic gas used annuallyBonaparte Gas Pipeline Construction commenced in 2008,due for completion early 2009.Goldfi elds Gas PipelineConstruction commenced on two new compressor stations at Wyloo West and Neds Cree
27、k.Pipeline capacity to increase by 20%.1.FEED Front-end engineering and design4APA ANNUAL REPORT 08It is a pleasure for me to present APA Groups annual report for 2008,my fi rst as Chairman.We have delivered another record fi nancial result and have enhanced our portfolio of essential energy infrast
28、ructure across Australia.Importantly,we are now a company that has direct management and operational control over its assets with over 1,100 skilled and experienced employees.On the basis of this strong performance and the continued growth of APAs business,on 26 August 2008 the board declared a fi n
29、al distribution of 15.0 cents per security,taking the full year distribution to 29.5 cents,a 5.4%increase over last year.This years distributions,as with previous years,were well covered by operating cash fl ow,with cash remaining to fund further business growth and debt reduction.Equity baseDuring
30、the year the number of APAs securityholders more than quadrupled to over 100,000 following the in-specie distribution of Alintas 35%stake in APA in August 2007.With this change the board decided to pay the annual distribution in two instalments instead of four,providing a considerable cost saving to
31、 the company.The Distribution Reinvestment Plan continued this year at a 2.5%discount,retaining around$39 million in capital.We also raised approximately$85 million in capital through the operation of the Security Purchase Plan.As a consequence 36.5 million new securities were issued during the year
32、.Delivering Australia s energyNatural gas is an important part of Australias energy mix and APA is in a strong position to contribute to this nations future economic growth and its commitment to long term emission reduction targets.Our Australia-wide portfolio of gas transportation infrastructure is
33、 currently delivering more than half the natural gas used in Australia,to fuel power stations,industry,businesses and homes.Furthermore,we see APAs infrastructure assisting in the expansion of a competitive gas market in Australia,particularly as it provides access to multiple supply sources and enh
34、ances producer on producer competition.Financial performanceAPA reported a record fi nancial result for the fi nancial year to June 2008,with underlying EBITDA of$430.5 million,up 45%on the prior year,and an underlying profi t of$82.2 million,up 27%.The increased performance has come from both our n
35、ew businesses and from our foundation assets,which continue to grow to meet demand requirements.APA has had a busy year in growing its portfolio of assets.We invested$557 million to acquire a one third interest in the SEA Gas Pipeline linking Victoria and South Australia,a 17%stake in Envestra Limit
36、ed and the long term contract to operate the Envestra Limited assets.Envestra is the owner of natural gas distribution businesses in South Australia,Victoria and Queensland.In addition to an attractive portfolio of assets,the acquisition also provided APA with the opportunity to signifi cantly expan
37、d our internal operating capability through the addition of approximately 490 employees.We built on this expanded capability by terminating the operating and maintenance function in respect to key APA pipelines previously performed by a third party.The restructure,in respect to which APA paid$206 mi
38、llion,also saw the transfer to APA of around 260 skilled pipeline operations personnel.These two major investments have afforded APA direct operation and maintenance control over its gas transmission and distribution assets,the benefi t of which is evident in this years fi nancial results.CHAIRMAN S
39、 REPORT5APA ANNUAL REPORT 08knowledge within APA to extract further value and maintain a competitive advantage.The benefi ts of internalising commercial and operational activities are evident in APAs strong performance this year,and we envisage APAs 1,100 employees will continue to optimise value fo
40、r the company.THE DEVELOPMENT ACTIVITIES ACHIEVED THIS YEAR,AND THOSE PLANNED FOR THE YEARS AHEAD,DEMONSTRATE THE STRATEGIC NATURE OF APAS GAS TRANSMISSION AND DISTRIBUTION ASSETSBoard and managementThis year has seen some changes to the board.After joining the board in August 2007,I was appointed C
41、hairman in October and George Bennett,APAs Chairman from prior to the companys initial listing,retired from the board.George has made an invaluable contribution,overseeing APA over its fi rst seven years.The company has grown and strengthened during this time,and more recently held its ground in the
42、 face of aggressive corporate activity.On behalf of the board,I take this opportunity to thank George for his leadership and commitment and to wish him the best for his future endeavours.The board also thanks Ross Gersbach for his contribution to the board.In February this year,after almost four yea
43、rs service,Ross retired as a director to take up an executive role within APA as Group Manager Commercial.We also welcome John Fletcher,who joined the board in February this year and will seek nomination for re-election at this years annual meeting of securityholders.John has extensive experience in
44、 the Australian and international energy industry and is a valuable addition to the board.OutlookIn the coming year,the board will be focused on ensuring APA delivers growth in operating cash fl ow from all parts of its business,in particular the gas transmission and distribution business.We expect
45、to see the demand for gas transport services continue to grow.This growth is supported by contractual arrangements that underpinned the investment activities during this year and those planned for the coming year.APA will actively develop and pursue profi table opportunities to enhance its portfolio
46、 of gas infrastructure assets and will benefi t from the fl exibility afforded by the funds expected to be received from the creation of the new unlisted vehicle.APAs people are key to the ongoing success of the company and we will continue to leverage their skills and experience in operating APAs w
47、holly and partly owned assets,and those of third parties.Barring unforeseen circumstances,APA directors reaffi rm previous guidance that they intend to increase distributions in the 2009 fi nancial year by at least 5%,and that those distributions will be fully covered by operating cash fl ow.In conc
48、lusion,I would like to thank my fellow directors,Managing Director Mick McCormack and his management team and all APA Group employees for their contribution to our record performance this year and you,our securityholders,for your continued support.Len Bleasel AMAPA Group ChairmanIn addition to our a
49、cquisitions of new business during the year,we were also active in growing our existing assets.We completed the construction of another compressor on the Moomba Sydney Pipeline at Culcairn and the Brooklyn Lara pipeline in Victoria,and began construction on the Bonaparte Gas Pipeline in the Northern
50、 Territory.We also commenced construction of three additional compressor stations on our Queensland and Western Australian pipelines.The development activities achieved this year,and those planned for the years ahead,demonstrate the strategic nature of APAs gas transmission and distribution assets.T
51、hese assets are fundamental to Australias economic development,and APAs board,management and employees recognise the responsibility attached to this custodianship.Strategy The pace of change in this industry is constant and during the year the board spent considerable time with management testing an
52、d reassessing the companys strategy.Subsequently,the board reaffi rmed APAs vision of continuing to grow as Australias leading gas transportation business,with the objective remaining the continuation of increases in distributions to securityholders and the payment of those distributions from operat
53、ing cash fl ow in a sustainable manner.To achieve the vision,the board has reaffi rmed APAs investment strategy and operating strategy.The investment strategy is to remain focused on gas infrastructure.APAs gas infrastructure assets are positioned to grow and deliver value to you as securityholders.
54、To focus on this growth,we have stated our intention to sell down some of our low growth,annuity-style assets into an unlisted fund,with APA retaining a minority interest and continuing as the operator of the assets.The capital raised will be used to strengthen our balance sheet and provide APA with
55、 the fl exibility to develop and pursue further growth opportunities.Our operating strategy is to leverage the tremendous industry skill and 6APA ANNUAL REPORT 08additional network operation and management skills into APA.In October 2007,we terminated the long term Alinta operation and maintenance a
56、rrangement on APAs foundation pipelines.In addition to removing fees and margins,around 260 highly skilled people were added to our pipeline business through that transaction.Our new and existing employees now provide all commercial and operational services to the business,delivering fi rst class op
57、erating and maintenance services to over$8 billion worth of assets which APA owns or operates.APAs business model is a low cost,transparent and competitive one.Our approach distinguishes us from many other infrastructure businesses that operate a fee-based model.APA people I am proud to be leading A
58、PAs 1,100 employees,people with tremendous skills and depth in the energy industry.Our workforce originated from six different businesses and we have APA has had a simple objective since listing eight years ago,that is to grow the business in order to maximise returns to our securityholders.This yea
59、rs record fi nancial results again demonstrate our success in achieving this objective.The strong fi nancial performance refl ects the growth of our underlying businesses,the solid contributions of the acquisitions made in the last two years and,in particular,internalising the operation and maintena
60、nce of our assets.Internally managed and operated businessThis year we completed the transition from infrastructure owner to an operating business principally through two acquisitions.In July 2007 we acquired the asset management business from Origin Energy,which included the long term contract to m
61、anage Envestras assets and the addition of some 490 personnel across the country.This group has brought built a national focus over the year,bringing our operations together,with teams working across states and across assets,combining the best ideas and thinking into one group.There is now a wider p
62、latform for APA employees to apply and further develop their skills and experience.Safety remains a high priority for APA.I am pleased that we have improved the safety performance of the major new operating businesses acquired during the year,and we will continue to maintain this as a company-wide f
63、ocus.IntegrationOur company-wide integration program commenced this year with the purchase of Origin Energys network asset business and followed by the Alinta operation and maintenance contract termination.These businesses have been transitioned and integrated into APA.At the same time,we restructur
64、ed APA to better deliver on its strategy,moving to a nationally operated business on functional,rather than geographic,management reporting lines.The restructure has included progressively moving to common processes which have delivered savings and further value to the business.We have implemented c
65、ommon operation and maintenance procedures in the gas pipeline and distribution business,created a project team to deliver on national procurement strategies and centralised our corporate services.These initiatives are starting to deliver reduced operating costs and savings in our capital expenditur
66、e.Next year we expect further benefi ts to be captured from the integration program.Operational and fi nancial performanceAll business segments performed well,contributing to the record fi nancial performance.Our underlying EBITDA of$430.5 million was up 45%on last year,and refl ects the positive im
67、pact of a number of items,including the acquisitions outlined above,as well as revenue growth from existing businesses,particularly the gas transmission and distribution business.MANAGING DIRECTOR S REPORTThis year again has been one of signifi cant change,enhancing our gas infrastructure portfolio
68、as well as completing our transformation into a truly independent operating business.APA is a leader in the industry on both fronts.7APA ANNUAL REPORT 08of assets into the fund and redistribute the capital towards core gas assets with growth potential.The assets to be transferred have annuity-style
69、incomes,either under long term contractual arrangements or regulatory frameworks,and complement each other on a portfolio basis.These are quality assets that we will continue to be involved in by retaining a minority interest in the fund in conjunction with new third party investors.APA will also re
70、main the manager and operator of the assets under a long term arrangement.The transaction will be fi nanced by non-recourse fi nance.We anticipate that proceeds of at least$500 million will be released from this transaction,which will go towards initially reducing debt,and so subsequently give us th
71、e fl exibility to develop the greenfi eld and brownfi eld opportunities on our gas assets.We have been pleased with the responses of both the debt and equity markets to the proposal and are on target to complete the transaction within the 2008 calendar year.APAS BUSINESS MODEL IS A LOW COST,TRANSPAR
72、ENT AND COMPETITIVE ONENatural gas and sustainable energyNatural gas provides an affordable,clean energy solution that will assist Australia in the transition to a carbon-constrained environment.The Federal Governments recently announced Carbon Pollution Reduction Scheme,which is scheduled to commen
73、ce in 2010,will fundamentally affect the investment and operating decisions of Australias electricity industry.The use of low and zero emissions electricity generation alternatives will be required to meet Australias emissions targets and any long term emissions reduction program will,by necessity,i
74、nclude the use of natural gas for electricity generation.APA,as Australias largest transporter of natural gas,should benefi t in this environment,as the cost of carbon is factored into coal-fi red generation.APA is committed to the principles of sustainable development and high The gas transmission
75、and distribution segment contributed 85%of APAs EBITDA for the year.Its underlying EBITDA increased by 33%to$368 million,with two key standouts being the performance of the Moomba Sydney pipeline and the Victorian Transmission System.Gas demand in New South Wales increased in the winter period and t
76、he Moomba Sydney pipeline system provided the capacity required to meet this peak demand.The performance of the Victorian Transmission System was boosted by both record gas throughput and the higher regulated tariffs approved by the Australian Energy Regulator.The tariffs,which apply from 1 January
77、2008,refl ect the current economic environment of higher debt and equity costs.The balance of EBITDA came from the remaining three business segments electricity transmission,asset management and complementary assets.All segments contributed positively,with the increase due to the partial or full yea
78、r contributions of recent acquisitions and developments.The asset management contribution was driven by the earnings from APAs operation and maintenance agreement with Envestra,and the complementary asset segment refl ected the contribution of the new 30 megawatt gas fi red power station at Mt Isa,c
79、ommissioned in November 2007.Our fi nancial position remains strong and sustainable,with operating cash fl ow increasing by 27.6%to$192 million.Operating cash fl ow per security also increased by 7.6%to 42.7 cents per security,providing the basis to increase distributions this year to 29.5 cents per
80、 security,an increase of 5.4%on last year.APA unlisted energy fundThere are numerous growth projects and opportunities available to APA.Our assets are in locations where demand for gas is growing and we have been busy building and developing additional capacity on our pipelines to meet new contracte
81、d demand as well as developing competitive alternatives for delivering gas through our pipeline infrastructure across eastern Australia.The establishment of APAs unlisted energy fund announced in May this year will provide further fl exibility to pursue these growth opportunities.We are proposing to
82、 sell a number standards of environmental performance as a responsible way to protect the environment.As Australias leading transporter of natural gas,APA minimises environmental impacts,adheres to environmental regulations and protects and regenerates the environment in which we operate.OutlookThe
83、fundamentals of APAs business remain solid as we continue to operate and enhance our portfolio of gas transportation infrastructure across the country.Our investments this year,and committed projects for 2009,will deliver secure,long term cash fl ow.We will focus on capturing further profi table gro
84、wth opportunities provided by our gas infrastructure footprint.We will pursue completion of the APA unlisted energy fund transaction which will strengthen our balance sheet and provide further fl exibility to fund our growth assets.We will continue our integration program and achieve further cost re
85、duction initiatives to enhance the bottom line for 2009.In addition,we will leverage the skills and experience of our employees to drive further value from the business.Our guidance for 2009 is a continuation of our objective to grow operating cash fl ows to support growth of at least 5%per annum in
86、 our distributions to securityholders.APA has delivered a solid fi nancial result for the year and again proved we are a robust,secure and dependable business with real opportunities for organic growth.I am very proud of what the company has achieved both for securityholders and for our customers th
87、is year.And I am confi dent that with the combination of our national gas infrastructure footprint,our prudent capital management and our dedicated highly skilled employees,we will continue to deliver fi nancial stability and growth into the future.Mick McCormackManaging Director APA Group8APA ANNUA
88、L REPORT 08WE DELIVEROperations Report9APA ANNUAL REPORT 089Gas Transmission and DistributionGas transmission and distribution includes all gas transmission pipeline and gas distribution network businesses across the country,comprising the main contribution(85%)to the companys fi nancial performance
89、.This year the segment achieved a 27%increase in revenue(excluding pass-through revenue)to$499 million due to the increased performance across the majority of pipelines and the full 12 months contributions of businesses acquired in 2007 and 2008.EBITDA increased 33%to$368 million refl ecting both th
90、e additional revenue outlined above and reduced operating expenses resulting from synergy benefi ts and the termination of the Alinta agreement.Left:Tony Spring inspecting the coolers on Compressor Unit 2,Culcairn Compressor Station,New South WalesAbove:Brad Evans and Marie Chretien negotiate and ma
91、nage the capacity contracts on the Moomba Sydney PipelineIn October 2007,the long term operating and maintenance agreement with Alinta,which provided services to APAs foundation gas transmission pipelines in New South Wales,Queensland,Northern Territory and Western Australia,was terminated.This resu
92、lted in the elimination of all fees paid to Alinta and the transfer of Alinta personnel involved in the provision of services to APA.APA now manages and operates all its gas transmission and distribution assets and has integrated its internal resources to provide a national operations and capital de
93、velopment program for this business segment.PIPELINESOWNERSHIP(%)STATELENGTH(KM)Carpentaria Gas Pipeline(including Cannington lateral)100Qld944Roma Brisbane Pipeline(including Peat lateral)100Qld558Gold Coast Gas Pipeline100Qld93Moomba Sydney Pipeline System100NSW/ACT2,029Central West Pipeline100NSW
94、255Central Ranges Pipeline100NSW294Victorian Transmission System100Vic1,936SEA Gas Pipeline33.3Vic/SA688SESA Pipeline100SA45Goldfi elds Gas Pipeline(including Murrin Murrin lateral,owned 100%by APA)88.2WA1,594Parmelia Gas Pipeline100WA462Mid West Pipeline50WA353Telfer Gas Pipeline100WA488Amadeus Gas
95、 Pipeline196NT1,702Bonaparte Gas Pipeline100NT287TOTAL11,728APA OWNS AND OPERATES STRATEGIC ENERGY INFRASTRUCTURE ASSETS ACROSS AUSTRALIA 1.APA forms 96%of the Amadeus Gas Trust which leases the Amadeus Gas Pipeline.10APA ANNUAL REPORT 08APA committed to a three year,$17 million expansion of the gas
96、 distribution network into new housing developments in the fast growing Gold Coast area.The extended network will service over 9,000 new home sites as well as provide the foundation infrastructure to further extend the network.New South WalesRevenue from the Moomba Sydney Pipeline(MSP)increased by$7
97、.0 million,primarily as a result of increased peak gas demand and new contracted services for the winter period.The MSP southern lateral was expanded to supply gas transportation services to Origin Energys open cycle peaking power station near Uranquinty in southern central NSW.The expansion include
98、d the construction QueenslandNew transportation agreements for the Carpentaria Gas Pipeline,including an agreement to supply gas transportation for the X41 Power Station,were executed during the year.These contracts underpin the development of a new compressor station at Davenport Downs,which will i
99、ncrease pipeline capacity by 15%.Commissioning of the compressor station is expected in mid 2009.APA Gas Network in Queensland increased billable connections to 73,960,up from 68,210 in 2007.Throughput was 13.3 PJ for the year,in line with the acquisition case.Demand for natural gas continues to inc
100、rease,driven in part by the Queensland Governments Climate Smart 2050 Policy.APA systems and policies were implemented,and all transitional services from the vendor(Energex)terminated as scheduled.APA commenced expansion of the Moomba Sydney Pipeline,Carpentaria Gas Pipeline,Goldfi elds Gas Pipeline
101、 and the Victorian Transmission System.of a compressor station at Culcairn,which was commissioned in June 2008.Capacity in the MSP system will be progressively increased over a fi ve year period to meet increasing winter peak requirements.The fi rst tranche of this additional capacity was made avail
102、able this winter.The$100 million expansion program is fully underwritten by long term shipper arrangements.In April 2008 APA acquired a 6%interest in the Mariner Pipeline Income Fund,together with the management rights,for$12 million.The Funds sole operating asset is the Moomba Sydney Ethane Pipelin
103、e.APA currently operates and maintains the 1,375 km Ethane Pipeline,and the management rights extend to at least 2016.VictoriaRecord volumes of gas were transported on the Victorian Transmission System in the current year,with an annual quantity of 244 PJ(previous record of 236 PJ for 2004 fi nancia
104、l year)and peak day delivery of 1,279 TJ(1,220 TJ in 2007).APA completed the construction of the Brooklyn Lara pipeline,with commissioning during winter 2008.WE DELIVEROperations Report(continued)11APA ANNUAL REPORT 08REGULATORYMATTERSAccess arrangementfor the Victorian Transmission SystemOn 25 June
105、 2008 the Australian Competition and Consumer Commission(ACCC)approved the 2008-2012 Access Arrangement for APAs Victorian Transmission System.The ACCC accepted APAs proposals and submissions on a number of key issues,including non-capital costs and the majority of forecast capital expenditure.The w
106、eighted average cost of capital applied to the 2008-2012 Access Arrangement refl ects the signifi cant changes in market conditions,including debt costs since the previous(2003)approval.The approved Access Arrangement allows APA to keep assumed synergies arising from APAs acquisition of GasNet.The A
107、CCC did not accept APAs view of capital expenditure required to ensure reliability of gas delivery in some areas of Victoria.However,APA is able to seek approval for such expenditure in the future if further expenditure is required to ensure security of supply.Moomba Sydney Pipeline High Court decis
108、ionIn September 2007 the long running proceedings between APA and the ACCC in relation to the Access Arrangement for the Moomba Sydney Pipeline(MSP)were resolved in APAs favour by the High Court of Australia.The decision has no material impact on MSP revenues since the pipeline is substantially unre
109、gulated and tariffs are set by negotiation.APA has applied to have the covered part of the MSP declared a“light regulation”pipeline under the new National Gas Law,which will reduce the regulatory cost.National Gas LawThe new National Gas Law and Rules were introduced on 1 July 2008 to replace the pr
110、evious Gas Pipelines Access Law and Gas Code.The new Law and Rules are broadly similar to the previous regime but contain important changes including the introduction of a light regulation option for some pipelines and the introduction of regulatory holidays for new pipelines.Under the new Law,the A
111、ccess Arrangement for the Carpentaria Gas Pipeline expired and has been replaced by the light regulation option.Western Australia Gas transportation revenues in Western Australia increased by$13.8 million due to increased third party demand,particularly from the mining sector.The gas supply disrupti
112、on in June 2008,due to the explosion at Apache Energys Varanus Island gas processing plant,reduced gas fl ow into the Goldfi elds Gas Pipeline and Telfer Gas Pipeline.However,this incident had no material fi nancial impact on APA due to a combination of factors including the“take-or-pay”nature of AP
113、As revenue contracts on both pipelines and the ability of shippers to source some alternate gas supplies.Signifi cant long term agreements for additional capacity on the Goldfi elds Gas Pipeline were executed with Rio Tinto subsidiary Hamersley Irons Paraburdoo mine and Minara Resources Murrin Murri
114、n operations.To meet this additional demand,development of two new compressor stations at Wyloo West and Neds Creek commenced which will increase pipeline capacity by 20%.In addition,two new connections were completed during the year,with gas now being delivered under long term transportation agreem
115、ents to the Cosmos and Jaguar mine sites.APA increased capacity of the Mondarra Gas Storage Facility with an additional injection and production well drilled into the Mondarra reservoir.The Mondarra facility is designed to receive and store gas from the Dampier to Bunbury Pipeline and deliver gas to
116、 Perth via APAs Parmelia Pipeline.Mondarra gas production peaked during the Varanus Island incident,supplying gas to Perth via the Parmelia Pipeline.Northern TerritoryIn March 2008,APA began construction of the Bonaparte Gas Pipeline,and the project is on schedule to deliver gas in early 2009.The 28
117、7 km pipeline will transport gas from Wadeye to the Amadeus Gas Pipeline under a 25 year Gas Transportation Agreement with Power Water Corporation.The$70 million,58 km pipeline effectively expanded the capacity of the Victorian Transmission System for gas fl ows from the Otway Basin in Victorias sou
118、thwest to the major demand centre of Melbourne.Upgrades to compressor stations on the Victorian Transmission System during the year totalled$30 million.The revised Victorian Transmission System Access Arrangement(2008-2012)was approved in June 2008.The revised higher tariffs apply from 1 January 200
119、8,and substantially increase revenue for the system over the fi ve-year regulatory period.The revised Access Arrangement also approves$187 million of proposed capital expenditure to 2012.South Australia As part of the Origin Energy Networks acquisition in June and July 2007,APA acquired the SESA Pip
120、eline in South Australia,a one third interest in the SEA Gas Pipeline,and a 17.2%stake in Envestra Limited.Envestras assets of gas distribution networks and pipelines are located mainly in South Australia,Victoria and Queensland.APA participated in two Envestra Distribution Reinvestment Plans(DRP),i
121、ncreasing its interest to 18.3%,with the total value of distributions reinvested of$14.3 million.APA COMMENCED CONSTRUCTION OF THE BONAPARTE GAS PIPELINE,WITH COMMISSIONING EXPECTED IN EARLY 2009Far left:Case McCaul(centre)inspecting APAs gas metering facilities at Incitec Pivot,QueenslandLeft:Azar
122、Balabandi and Robert McMaster apply engineering and management skills to gas infrastructure projects12APA ANNUAL REPORT 08WE DELIVEROperations Report(continued)13APA ANNUAL REPORT 08to the Moomba Sydney Ethane Pipeline.The long term Envestra contract was part of the acquisition of the Origin Energy
123、Asset Management group in July 2007,and included the transfer of the long term operations and maintenance of Envestra assets across fi ve states and territories.APA systems were implemented and all transitional services from Origin Energy terminated as scheduled,effective 31 December 2007.The operat
124、ion and maintenance agreement in relation to the Moomba Sydney Ethane Pipeline was transferred to APA as part of the termination of the Alinta Pipeline Management Agreement.Complementary assetsComplementary assets revenue for the year was$34.9 million,with all assets having performed in line with ex
125、pectations.Complementary assets are energy assets developed or acquired by APA.The four main assets are located on or near APAs gas transmission pipelines in Queensland,and provide energy services to single customers under lease arrangements.These include two coal seam gas processing plants and two
126、gas fi red power stations,including the recently commissioned X41 Power Station at Mt Isa.In November 2007,APA commissioned the 30 megawatt gas fi red low emissions X41 Power Station,which provides additional power to Xstratas upgraded and expanded minerals processing facilities.The power station re
127、ceives natural gas via the Carpentaria Gas Pipeline,and will operate under a contract for 15 years.Complementary assets also include a number of Natural Gas Vehicle(NGV)and cogeneration businesses acquired as part of the Origin Energy Networks acquisition in July 2007.Electricity transmissionAPAs tw
128、o electricity transmission assets,Directlink and Murraylink,have an annuity-style income stream,receiving fi xed annual revenue based on the regulated value of the assets.Revenue from these two assets increased by$8.0 million to$25.2 million due to a full 12 months contribution from the Directlink b
129、usiness acquired in February 2007.Murraylink and Directlink have similar operating technology,creating operational synergies.Earnings for this segment continued to perform according to expectations.Asset managementAsset management revenue refl ects the fi rst 12 months of revenue(excluding cost reco
130、very revenue)from providing asset management,operating and maintenance services to Envestra and nine months revenue from providing operating and maintenance services DELIVERING SUSTAINABLE ENERGYClimate change is one of the greatest economic,social,and environmental challenges of our time.In additio
131、n to taking an active role in reducing its own carbon footprint,APA recognises its broader role in facilitating the delivery of clean energy to those industries and individuals endeavouring to reduce their carbon footprint.Delivering cleaner energyNatural gas is a clean energy fuel with a much lower
132、 carbon impact than coal.Achieving Australias emissions targets at least cost is vital to a sustainable economy.Natural gas provides an affordable,clean energy solution that will assist Australia in the transition to a carbon-constrained environment while maintaining economic growth.A participant in
133、 the Carbon Pollution Reduction SchemeAPA supports the introduction of a carbon pollution reduction scheme as a recognition that Australia needs to transition to a lower-emissions future in order to combat climate change.Gas fi red power generation is a positive option in a low emissions environment
134、 and APA advocates gas as a fuel of choice for future base-load generation.Delivering sustainable solutions to businessThe sustainable benefi ts of gas are being recognised by those businesses striving to reduce their carbon footprint.For example,the conversion of coal boilers to natural gas high ef
135、fi ciency steam boilers signifi cantly reduces water and energy consumption,and thereby carbon emissions.Left:Elizabeth Livingstone(left)and Alice Tai(2nd from left)explaining aspects of the gas metering station at CS Energys Swanbank Power Station,QueenslandAbove:Bob Paton and Ivan Byak,part of APA
136、s Commercial teamAPAS 1,100 HIGHLY SKILLED AND EXPERIENCED PERSONNEL MANAGE AND OPERATE OVER$8 BILLION WORTH OF ENERGY ASSETS ACROSS AUSTRALIA 14APA ANNUAL REPORT 08Michael McCormack BSurv GradDipEng MBA FAICDMANAGING DIRECTORAppointed Managing Director1 July 2006Michael(“Mick”)McCormack has been Ch
137、ief Executive Offi cer of APA since 1 July 2005 and was appointed Managing Director on 1 July 2006.Mick has had a long career,including extensive senior management experience,in the energy transmission sector in Australia,with particular focus on gas transmission pipelines,where he has worked on the
138、 development of new and existing pipelines across Australia.Mick is Chairman of NT Gas Pty Ltd and a director of Envestra Limited,the Australian Pipeline Industry Association and the Australian Brandenburg Orchestra.John Fletcher BSc MBAINDEPENDENT DIRECTORAppointed 27 February 2008John Fletcher has
139、 over 35 years experience in the energy industry,having held a number of executive Leonard Bleasel AM FAICD FAIMINDEPENDENT CHAIRMANAppointed 28 August 2007Appointed Chairman 30 October 2007Leonard(“Len”)Bleasel is Chairman of ABN AMRO Australia Holdings Pty Limited,Taronga Conservation Society Aust
140、ralia,and a non-executive director of QBE Insurance Group Limited and OConnell Street Associates Pty Limited.Len is also involved as a member of several charitable institutions.Len had a long career in the energy industry before retiring from management in 2001.He started his career in AGL in 1958 a
141、nd worked in a variety of roles,culminating in the position of Managing Director and CEO from 1990 to 2001.Lens past appointments have included Chairman of Foodlands Associated Limited,Solaris Power,the Australian Gas Association,Natural Gas Corporation Holdings Ltd(New Zealand),Elgas Ltd,Auscom Hol
142、dings Pty Ltd,Industrial Pipe Systems Pty Ltd and East Australian Pipeline Ltd;director of St.George Bank Limited and Gas Valpo,(Chile);and Vice President of the Royal Blind Society.Len was awarded an AM in the General Division of the Order of Australia for services to the Australian gas and energy
143、industries and the community.positions in AGL prior to his retirement in 2003,including Chief Financial Offi cer.John has previously been a director of Integral Energy,NGC Limited of New Zealand and Foodlands Associated Limited.He brings a wide commercial and fi nancial practical knowledge to the bo
144、ard.John was previously an AGL appointed director of Australian Pipeline Limited during 2000 to 2005.He is also a director of Babcock&Brown Power and Sydney Water.John is the Chairman of the Remuneration Committee and a member of the Audit and Risk Management Committee.Russell Higgins AO BEc FAICDIN
145、DEPENDENT DIRECTORAppointed 7 December 2004Russell Higgins has extensive experience both locally and internationally in the energy sector and in economic and fi scal policy.He was Secretary and Chief Executive Offi cer of the Department of Industry,Science and Resources from 1997 to 2002 and Chairma
146、n of the Australian Governments Energy Task Force from 2003 to 2004.Russell is the Chairman of the Co-operative Research Centre for Coal in Sustainable Development and Chairman of the CSIRO Energy Transformed Flagship Advisory Committee.He is a director of RiceGrowers Limited(trading as Sunrice).He
147、is a former Chairman of the Snowy Mountains Council,a former Chairman of the Australian Governments Management BOARD OF DIRECTORS15APA ANNUAL REPORT 08in Malaysia and abroad.He has been involved in district cooling cogeneration,pipeline gas transmission and distribution,LNG production and marketing,
148、and urea/ammonia production and marketing.He currently sits on the boards of Transportadora de Gas Del Norte of Argentina and Petronas Gas Berhad of Malaysia,both of which are gas pipeline transmission companies.He is also a member of the Malaysian Energy Commission,a Malaysian Government regulatory
149、 body.Muri is a member of the Remuneration Committee and the Health Safety and Environment Committee.Manharlal Ratilal MBAINDEPENDENT DIRECTORAppointed 31 July 2007Manharlal(“George”)Ratilal is Vice President(Finance)of Petronas.He is a member of Petronas Management Committee and sits on the boards
150、of several Petronas subsidiaries.Prior to joining Petronas in 2003,he was employed by a local Malaysian merchant bank for 18 years.During that time,George specialised in corporate fi nance where he advised on mergers and acquisitions,and the capital markets.George holds an MBA from the University of
151、 Aston in Birmingham,United Kingdom.Improvement Advisory Committee and a former director of Australian Biodiesel Group Limited,EFIC,CSIRO,Austrade,the Australian Industry and Development Corporation,the Australian Tourist Commission,and the Australian Sports Commission as well as a former member of
152、the Australian Governments Joint Economic Forecasting Group.In 2006-07 he was a member of the Prime Ministerial Task Group on Emissions Trading.Russell is Chairman of the Health Safety and Environment Committee and a member of the Audit and Risk Management Committee and the Remuneration Committee.Mu
153、ri Muhammad MScINDEPENDENT DIRECTORAppointed 8 March 2000Muri Muhammad retired from Petronas in August 2002 and was reappointed as Adviser,Gas Business in the Presidents Offi ce until 30 March 2005.He brings 30 years experience in the chemicals and petroleum industry as well as expertise in the dome
154、stic and international gas transmission and distribution,gas utilisation,cogeneration and conversion businesses where he has held various senior executive positions.Muri was Petronas Vice President for Gas Business from 1998 until his retirement.In that role,he was involved in gas development projec
155、ts in Iran,India,Algeria,Myanmar,Pakistan,Vietnam and China.He has held several directorships including Chairman of the board of Petronas subsidiaries and associate companies Robert Wright BComm FCPAINDEPENDENT DIRECTORAppointed 11 February 2000Robert Wright has over 30 years fi nancial management e
156、xperience,having held a number of Chief Financial Offi cer positions,including Finance Director of David Jones Limited.He is currently the Chairman of Dexion Limited,SAI Global Limited and Babcock&Brown Residential Land Partners Group and a director of Super Cheap Auto Group Limited.Robert is the Ch
157、airman of the Audit and Risk Management Committee and a member of the Health Safety and Environment Committee.16APA ANNUAL REPORT 08EXECUTIVE MANAGEMENTRichard FrancisBComm CA MBA GAICDCHIEF FINANCIAL OFFICERRichard(“Rick”)is responsible for the fi nancial management of APA.This includes accounting
158、and fi nancial reporting,fi nancial compliance and governance,taxation,treasury and IT functions.Rick has 26 years accounting experience including over fi ve years as the Group Financial Controller for Origin Energy and he also held a number of divisional senior management positions in Boral Energy
159、and Boral.Ross Gersbach BBus CPAGROUP MANAGER COMMERCIALRoss has responsibility for all commercial aspects of APA,including sales,strategic development and planning,investment management and corporate development.Ross has over 20 years experience in senior positions across a range of energy related
160、sectors,covering areas such as infrastructure investments,mergers and acquisitions and strategic developments.In addition he has extensive commercial experience and has managed a portfolio of infrastructure assets in the electricity and natural gas distribution network sector.Stephen OhlBEng GradDip
161、Man MIEAust FAICDGROUP MANAGER OPERATIONSStephen is responsible for the operational performance of all APA assets.This includes primary responsibility for the operation,contract management,project development and technical regulation of all pipeline and related assets.Stephen has over 30 years exper
162、ience in the petrochemical,oil and gas and pipeline industries of which 20 years has been spent managing and operating APA assets.Robyn SmithBA GradDipBusAdminGENERAL MANAGER HUMAN RESOURCES,HEALTH,SAFETY&ENVIRONMENTRobyn is responsible for the management of human resources,health,safety and environ
163、ment issues for the APA Group.This includes responsibility for APAs people strategy,ensuring effective health,safety and environmental performance,attraction and retention of talent,remuneration strategy,and the development of management and leadership skills across the business.Robyn has over 18 ye
164、ars experience in human resource management,the last eight years in the energy industry.Mark KnapmanBComm LLB GradDipAppCorpGovCOMPANY SECRETARYIn addition to being responsible for the secretariat function,Mark oversees corporate governance and the risk management and compliance functions.Mark has e
165、xtensive experience as a Company Secretary having spent over 12 years in the secretariat function for both listed public and proprietary companies.He was Company Secretary and General Counsel of ASX-listed Keycorp Limited prior to joining APA and,before moving into that and other corporate roles,was
166、 a partner of Australian law fi rm Hunt&Hunt.Sandra DureauBA(Asian Studies)LLB GAICDGENERAL COUNSEL/GENERAL MANAGER REGULATORYSandra is responsible for the management of legal and economic regulatory matters affecting APA.This includes responsibility for the outcome of regulatory processes under the
167、 National Gas Law.Sandra has extensive legal and regulatory experience in energy infrastructure,having worked in the industry since 1996 in legal,regulatory and commercial roles.Prior to moving in-house,she worked as a solicitor for 10 years.17APA ANNUAL REPORT 08CORPORATE GOVERNANCESTATEMENTAPA Gro
168、up(APA)comprises two registered investments schemes,Australian Pipeline Trust and APT Investment Trust,the securities in which are“stapled”together,and their controlled entities.Australian Pipeline Limited(APL)is the Responsible Entity for Australian Pipeline Trust and APT Investment Trust,and is re
169、sponsible for APAs corporate governance practices.The ASX Corporate Governance Council issued its revised Corporate Governance Principles and Recommendations in August 2007(Principles).The adoption of the Principles is not compulsory.However,under the Australian Securities Exchange(ASX)Listing Rules
170、,companies are required to provide a statement in their annual report disclosing the extent to which they have followed the Principles in the reporting period and,where companies have not followed all the Principles,they must identify which ones they have not followed and give reasons for not follow
171、ing them.The fi rst year that listed entities are required to report against the revised Principles is the year ending 30 June 2009.However,APA has elected to report by reference to the Principles this fi nancial year.For transparency,each of the eight Principles has been responded to in turn below.
172、In this section,various references are made to APAs web site as a source of information on corporate governance practices.The home page for APAs web site is .au,and the link entitled“About APA”leads to the corporate governance material.If you do not have internet access but wish to read that materia
173、l,please telephone 1800 992312(or+61 2 82807132,if calling from outside Australia)and we will send you a copy of the relevant material.PRINCIPLE 1Lay solid foundations for management and oversight by the board The board is accountable to securityholders for the proper management of APAs business and
174、 affairs.It operates in accordance with a charter,which is published on APAs web site.To assist the board in carrying out its responsibilities,the following standing committees of its members have been established:Audit and Risk Management Committee?Remuneration Committee,and?Health,Safety and Envir
175、onment Committee.?The board delegates responsibility for implementing the strategic direction and managing the day-to-day operations of APA to the Managing Director.The Managing Director consults with the Chairman,in the fi rst instance,on matters that are sensitive,extraordinary or of a strategic n
176、ature.The Managing Director,Chief Financial Offi cer and other senior management have service contracts setting out their duties,responsibilities,conditions of service and termination entitlements.The appointment of the General Manager Human Resources in October 2007 and subsequent enhancement of th
177、e Human Resources function have improved induction and management development programmes across the business.Further improvements to the induction programme,succession planning and implementation of a leadership development programme are ongoing endeavours.APA has processes in place to review the pe
178、rformance of senior management.Each senior manager,including the Managing Director,has personal objectives as well as objectives related to the performance of business units and APA as a whole.They are assessed against those objectives on an annual basis,or more frequently if that is indicated.Asses
179、sments for senior management personnel took place in June 2008.Performance evaluation of the Managing Director is handled by the Chairman with the assistance of the Remuneration Committee.A full report is provided to and reviewed by the board.Assessment and monitoring of the performance of other sen
180、ior managers are handled by the Managing Director who reports on those matters to the Chairman and the Remuneration Committee.PRINCIPLE 2Structure the board to add value The board determines its size and composition,subject to limits imposed by APLs constitution.The constitution provides for a minim
181、um of three directors and a maximum of 12.18APA ANNUAL REPORT 08CORPORATE GOVERNANCESTATEMENT(CONTINUED)At 1 July 2007 there were six directors on the board.Mr Manharlal(George)Ratilal was appointed to the board on 31 July 2007.Mr Leonard Bleasel was appointed on 28 August 2007 as Chairman elect fol
182、lowing the announcement of Mr Bennetts intention to retire on 30 October 2007.Mr Ross Gersbach resigned from the board on 31 January 2008 to take up an executive position as APAs Group Manager Commercial.Mr John Fletcher was appointed to the board on 27 February 2008.The board currently consists of
183、seven directors whose respective terms of offi ce as director,and whose names,experience and membership of board committees,are set out on pages 14 and 15.The composition of the board is determined in accordance with the following principles:a majority of the board will be comprised of independent d
184、irectors?the Chairman will be an independent director,and?a person cannot hold the positions of both Chairman and Chief Executive Offi cer.?Under APLs constitution,Petronas Australia Pty Limited is entitled to appoint one director of APL while the Petronas Group holds not less than 10%of the issued
185、securities in APA Group.Mr Muri Muhammad is the current Petronas-appointed director.APLs constitution requires one-third of its directors(excluding the Managing Director,the Petronas-appointed director and any director who is standing for re-election after having been appointed as an additional dire
186、ctor or to fi ll a vacancy)to retire from offi ce at the annual general meeting each year.If the calculation of that one-third is not a whole number,the number of directors required to retire by this“rotation”process is rounded to the nearest whole number.Retiring directors are eligible for re-elect
187、ion.Mr Wright will retire and offer himself for re-election under this provision of the constitution at the 2008 annual general meeting.If the board appoints a director to fi ll a vacancy or as an addition to the board,the new director holds offi ce until the end of the next annual general meeting a
188、nd is eligible for re-election.Mr Fletcher will stand for election on this basis at the 2008 meeting.At least 60 days before annual general meetings of APL,securityholders are notifi ed,by announcement to the ASX,that they may nominate a person to fi ll a vacancy on the board that arises on retireme
189、nt of either a director under the“rotation”process or a director appointed by the board since the last annual general meeting.If securityholders wish to exercise that right,at least 45 days before the annual general meeting they must send APL a signed nomination form and the nominees signed consent
190、to act as director.If nominations are received by the required date,APL advises securityholders of all candidates who have been validly nominated and presents its nominations to the annual meeting of securityholders.The board has assessed the independence of the non-executive directors and considers
191、 that Messrs Bleasel,Fletcher,Higgins,Muhammad,Ratilal and Wright are independent.APA has previously advised that it has received legal advice confi rming the independence of the Petronas-appointed director,Mr Muhammad,and Mr Ratilal,who is an employee of Petronas,on the basis that there are no sign
192、ifi cant day to day business dealings between Petronas and APL and that Petronas does not have any interest in APL.Mr McCormack,as Managing Director,is not considered to be independent.The former Nominations and Remuneration Committee of the board became the Remuneration Committee in early 2008 so t
193、hat the functions with respect to selection and appointment of new directors and related matters previously handled by that committee then reverted to the board.Ultimate responsibility for such matters rests with the full board anyway and the board considers the effi cient handling of those matters
194、is not diminished by not having a Nominations Committee.In considering potential new directors to commend to shareholders of APL and securityholders,the board seeks to identify candidates with appropriate skills and experience to contribute to the effective direction of APA and who can exercise an i
195、ndependent and informed judgement on matters which come to the board.A formal review process to assess the performance of the board,its committees and individual directors is undertaken each year,the last review having occurred in December 2007.The review involves completion of a questionnaire by ea
196、ch director.The responses are then collated and the board meets to discuss and consider the results and to determine any actions arising from the review.The Chairman also meets 19APA ANNUAL REPORT 08CORPORATE GOVERNANCESTATEMENT(CONTINUED)with each director to discuss the review and the directors ow
197、n performance,and to seek the directors feedback on the performance of the Chairman.Matters covered by the performance review include the role of the board and its committees,their composition,how the board operates,how board members interact,the effectiveness of the Chairman in leading the board an
198、d board performance generally.Subject to normal privacy requirements,directors have access to APAs records and information,and to the Company Secretary and other relevant senior management personnel.They receive regular detailed reports on fi nancial and operational aspects of APAs business and may
199、request elaboration or explanation of those reports at any time.Each director also has the right to seek independent professional advice at APAs expense.Prior approval of the Chairman is required,but this may not be unreasonably withheld.Directors and senior management are encouraged to broaden thei
200、r knowledge of APAs business and to keep abreast of developments in business more generally by attendance at relevant courses,seminars and conferences,both in Australia and where appropriate overseas.APA meets expenses involved in such activities.PRINCIPLE 3Promote ethical and responsible decision m
201、aking The board and senior management are fi rmly committed to ensuring that they and all employees observe high standards of ethical behaviour and conduct.APAs code of conduct sets out the behaviour required of directors and employees and recognises the responsibilities of APA and its personnel to
202、securityholders,customers and suppliers,the community and employees.It also requires that breaches of the code are reported and provides a mechanism to enable breaches to be reported without fear of retribution.The code of conduct is published on APAs web site.APA also has a whistleblowers policy.Th
203、is policy covers the procedures for dealing with reports of suspected improper conduct within APA.It also addresses the protection of individuals making those reports.This policy is consistent with the whistleblower provisions of the Corporations Act 2001(Part 9.4AAA)and Australian Standard AS 8004.
204、2003.APA also has a formal policy on dealing in securities.The policy provides that directors and designated senior management personnel may buy or sell APA securities only during the four week periods following the release to ASX of the half year and full year results and the annual meeting of APA,
205、unless exceptional circumstances apply.In any case,directors and all employees are precluded from buying or selling securities at any time if they are aware of any price-sensitive information which has not been made public.PRINCIPLE 4Safeguard integrity in fi nancial reporting The board has establis
206、hed an Audit and Risk Management Committee,the composition of which is determined in accordance with the following principles:the committee will have at least three members?all members of the committee will be independent,non-executive directors,and?the committee Chairman cannot also be the Chairman
207、 of the board.?The current members of the committee are Messrs Wright(committee Chairman),Fletcher and Higgins and their qualifi cations are set out on pages 14 and 15.The Chairman of the board,although not a member of the committee,usually attends committee meetings.The roles and responsibilities o
208、f the committee are set out in the committees charter which is published on APAs web site.The Managing Director,Chief Financial Offi cer,Company Secretary,other senior management personnel,as required,and the external and internal auditors attend committee meetings at the discretion of the committee
209、.The committee also meets with the external and internal auditors without management present.The minutes of each committee meeting are reviewed at the subsequent meeting of the board and the committee Chairman reports on the committees activities and recommendations to the board.20APA ANNUAL REPORT
210、08CORPORATE GOVERNANCESTATEMENT(CONTINUED)The committee is required by its charter to meet at least four times each year.The number of times it met during the fi nancial year ended 30 June 2008,and the committee members attendance at those meetings,are set out in the Directors Report.The committee m
211、onitors the effectiveness and independence of the external and internal auditors and the independence of the external auditor,and makes recommendations to the board on the appointment or replacement(subject to securityholders approval,if applicable)of the auditor.APLs costs incurred in acting as Res
212、ponsible Entity for Australian Pipeline Trust and APT Investment Trust are reimbursed by APA.The actual cost recovery for the year ended 30 June 2008 was$2.8 million.APL does not make a profi t,nor seek performance fees.The constitutions of Australian Pipeline Trust and APT Investment Trust enable A
213、PL to charge fees up to 0.5%per annum of the value of gross assets,however,the right to charge this has been waived to the extent it exceeds APLs costs.PRINCIPLE 5Make timely and balanced disclosure APA has a continuous disclosure policy aimed at ensuring that information that a person could reasona
214、bly expect to have a material effect on the security price,whether the information is positive or negative,is announced to the market by release to the ASX in accordance with the ASX Listing Rules and the Corporations Act 2001.The Company Secretary is the nominated continuous disclosure offi cer.All
215、 ASX announcements are posted on APAs web site as soon as reasonably possible after notifi cation to the ASX.The continuous disclosure policy is published on APAs web site.PRINCIPLE 6Respect the rights of shareholders APA aims to ensure that its securityholders are informed of all signifi cant devel
216、opments affecting APAs state of affairs and business.Information is communicated to securityholders by a number of means,including the following:the interim(half yearly)report,the directors commentary on that report and the annual report?APAs web site which has a dedicated Investor Relations section
217、?announcements to the ASX and media releases,copies of which are posted to APAs web site?a securityholders report is sent concurrently with the payment of distributions?“Open Briefi ngs”are prepared from time to time to provide an update to investors,and are released to the ASX?analyst briefi ngs wh
218、ich are released to the ASX?the annual meeting of securityholders,and?webcasting of half-year and full year accounts presentations,the annual meeting and announcements of major events.?Securityholders are given the opportunity to provide their email addresses to APA to enable them to promptly receiv
219、e reports and announcements to ASX.The recent appointment of an Investor Relations Manager and the planned redesign and expansion of APAs web site will assist further the provision of comprehensive and timely information to securityholders.At the annual meeting of securityholders,the Chairman encour
220、ages questions and comments from securityholders and seeks to ensure the meeting is managed to give the maximum number of securityholders an opportunity to participate.In the interests of clarity,questions on operational matters may be answered by the Managing Director or another appropriate member
221、of senior management.The external auditor attends annual meetings and is available to respond to questions about the conduct of the audit and the preparation and content of the independent audit report.21APA ANNUAL REPORT 08CORPORATE GOVERNANCESTATEMENT(CONTINUED)PRINCIPLE 7Recognise and manage risk
222、 The identifi cation and effective management of risk,including calculated risk-taking,is viewed as an essential part of APAs approach to creating long-term securityholder value.The board is responsible for adopting and reviewing APAs approach to the identifi cation,evaluation and management of busi
223、ness risks that are material to the fulfi lment of APAs business objectives.The board has delegated certain activities to its Audit and Risk Management Committee(ARM Committee)the charter for which is published on APAs web site.With respect to business risk,the ARM Committees primary function is to
224、maintain and oversee a sound system of internal risk management controls based on the boards adopted risk management approach.Specifi c risk management responsibilities of the ARM Committee include:reviewing and approving APAs updated risk profi le,and risk management policy and framework;?reviewing
225、 at least annually APAs implementation of the risk management policy and framework;and?receiving and reviewing managements report on the effectiveness of risk management and internal control systems?and otherwise monitoring the effectiveness of the risk management framework and the system of interna
226、l control,and progress against agreed risk management plans.The Managing Director is accountable for ensuring that a risk management system is established,implemented and maintained in accordance with APAs risk management policy and framework.Senior management are accountable for risk management wit
227、hin the areas under their control,including devolution of the risk management process to operational managers,and are responsible for:reviewing the measures of risk impact severity that underlies the identifi cation of material business risks,to ensure the?measures remain current to APAs context;ide
228、ntifi cation of material business risks that may impact on APAs business plans and objectives and the development,?implementation,performance and review of risk management plans.In doing so,senior management considers both fi nancial risk and non-fi nancial risk,including operational,environmental,s
229、trategic,market-related,compliance and reputation risk;aggregating operational risk data across APA,and monitoring external factors,to facilitate monitoring of APAs risk?profi le;andcontributing advice,leadership and facilitation in the development of group-wide risk control solutions.?The Company S
230、ecretary is responsible for:overseeing and facilitating the co-ordination of the risk management activities of senior management;?reporting regularly to the ARM Committee on APAs risk profi le and the implementation and effectiveness of risk?management plans;contributing leadership and facilitation
231、of the implementation of group-wide risk control solutions;and?working with senior management to design and develop risk education and communication forums.?The internal audit function audits the implementation of the risk management framework and policy in selected areas of APAs business based on a
232、 plan agreed with management and the ARM Committee,and reports its fi ndings to the ARM Committee.In respect to specifi c corporate governance recommendations of the ASX Corporate Governance Council:APAs management has reported to the ARM Committee as to its assessment of the effectiveness of manage
233、ment?by APA of its material risks;andin the course of approving the fi nancial statements for the year ended 30 June 2008,the board considered a written?statement from the Chief Executive Offi cer and the Chief Financial Offi cer to the effect that,to the best of their knowledge and belief,their dec
234、laration pursuant to section 295A of the Corporations Act 2001(broadly,that the fi nancial statements give a true and fair view in all material respects of APAs fi nancial position and comply in all material respects with relevant accounting standards)is founded on a sound system of risk management
235、and internal control and that system is operating effectively in all material respects in relation to fi nancial reporting risks,based on the management framework adopted by APA.22APA ANNUAL REPORT 08CORPORATE GOVERNANCESTATEMENT(CONTINUED)PRINCIPLE 8Remunerate fairly and responsibly The board has e
236、stablished a Remuneration Committee to consider and make recommendations to the board on,among other things,remuneration policies applicable to board members and senior management.The composition of the Remuneration Committee is determined in accordance with the following principles:the committee wi
237、ll have at least three members,?all members of the committee will be non-executive directors and a majority of them will be independent directors,and?the committee Chairman will be an independent director.?The current members of the committee are Messrs Fletcher(committee Chairman),Higgins and Muham
238、mad.Mr Bennett stood down as committee Chairman on his retirement in October 2007.The Chairman of the board,although not a member of the committee,usually attends committee meetings.The roles and responsibilities of the Remuneration Committee are set out in the committees charter which is published
239、on APAs web site.The Managing Director attends meetings of the committee by invitation when required to report on and discuss senior management performance and other remuneration matters.The minutes of each committee meeting are reviewed at the subsequent meeting of the board and the committee Chair
240、man reports on the committees activities and recommendations to the board.The committee is required by its charter to meet at least twice each year.The number of times it met during the fi nancial year ended 30 June 2008,and the committee members attendance at those meetings,are set out in the Direc
241、tors Report.The committee can seek external professional advice on any matter within its terms of reference.Independent remuneration consultants were engaged to review non-executive director and executive compensation during the fi nancial year.The Corporations Act 2001 does not require registered i
242、nvestment schemes like Australian Pipeline Trust and APT Investment Trust to include a remuneration report as part of the annual Directors Report,but APA has chosen to do so.APAs remuneration report sets out details of APAs policies with respect to remuneration of non-executive directors,the Managin
243、g Director and other key management personnel,together with details of the components of remuneration and total remuneration paid to each of those individuals over the fi nancial year to which the report relates.In 2003 the board terminated the non-executive directors retirement benefi t plan so tha
244、t the benefi ts to participating directors that had accrued up to termination were then quantifi ed and preserved for payment on retirement of those directors.Under the plan,after three years service a director was entitled to the equivalent of the emoluments received over the most recent 12 months.
245、After ten years service,the entitlement increased to the equivalent of emoluments received during the most recent three years.No additional entitlement accrued after ten years.For periods between three and ten years,the entitlement was calculated on a pro-rata basis.The benefi t of former Chairman M
246、r G H Bennett under the retirement benefi t plan was paid on his retirement as Chairman in October 2007 and the amount of that payment is set out in the remuneration report.Mr R J Wright is the only current director entitled to benefi t under the plan on his retirement from the board.23APA ANNUAL RE
247、PORT 08CORPORATE GOVERNANCESTATEMENT(CONTINUED)CORPORATE GOVERNANCE PRINCIPLES&RECOMMENDATIONS Issued by ASX Corporate Governance Council(Revised in August 2007)Comply(Yes/No)Principle 1:Lay solid foundations for management and oversight by the board1.1Companies should establish the functions reserv
248、ed to the board and those delegated to senior executives and disclose those functionsYes1.2Companies should disclose the process for evaluating the performance of senior executivesYes1.3Companies should provide the information indicated in the Guide to reporting on Principle 1YesPrinciple 2:Structur
249、e the board to add value2.1A majority of the board should be independent directorsYes2.2The chair should be an independent directorYes2.3The roles of chair and chief executive offi cer should not be exercised by the same individualYes2.4The board should establish a nomination committeeNo(note 1)2.5C
250、ompanies should disclose the process for evaluating the performance of the board,its committees and individual directorsYes2.6Companies should provide the information indicated in the Guide to reporting on Principle 2YesPrinciple 3:Promote ethical and responsible decision-making3.1Companies should e
251、stablish a code of conduct and disclose the code or a summary of that code as to:the practices necessary to maintain confi dence in the companys integrity?the practices necessary to take into account their legal obligations and the reasonable?expectations of their stakeholdersthe responsibility and
252、accountability of individuals for reporting and investigating reports?of unethical practicesYes3.2Companies should establish a policy concerning trading in company securities by directors,senior executives and employees,and disclose the policy or a summary of that policyYes3.3Companies should provid
253、e the information indicated in the Guide to reporting on Principle 3YesPrinciple 4:Safeguard integrity in fi nancial reporting4.1The board should establish an audit committeeYes4.2The audit committee should be structured so that it:consists only of non-executive directors?consists of a majority of i
254、ndependent directors?is chaired by an independent chair,who is not chair of the board?has at least three members?Yes4.3The audit committee should have a formal charterYes4.4Companies should provide the information indicated in the Guide to reporting on Principle 4No(note 2)24APA ANNUAL REPORT 08CORP
255、ORATE GOVERNANCESTATEMENT(CONTINUED)Comply(Yes/No)Principle 5:Make timely and balanced disclosure5.1Companies should establish written policies designed to ensure compliance with ASX Listing Rule disclosure requirements and to ensure accountability at a senior executive level for that compliance and
256、 disclose those policies or a summary of those policiesYes5.2Companies should provide the information indicated in the Guide to reporting on Principle 5YesPrinciple 6:Respect the rights of shareholders6.1Companies should design a communications policy for promoting effective communication with share
257、holders and encouraging their participation at general meetings and disclose their policy or a summary of that policyYes6.2Companies should provide the information indicated in the Guide to reporting on Principle 6YesPrinciple 7:Recognise and manage risk7.1Companies should establish policies for the
258、 oversight and management of material business risks and disclose a summary of those policiesYes7.2The board should require management to design and implement the risk management and internal control system to manage the companys material business risks and report to it on whether those risks are be
259、ing managed effectively.The board should disclose that management has reported to it as to the effectiveness of the companys management of its material business risksYes7.3The board should disclose whether it has received assurance from the chief executive offi cer(or equivalent)and the chief fi nan
260、cial offi cer(or equivalent)that the declaration provided in accordance with section 295A of the Corporations Act is founded on a sound system of risk management and internal control and that the system is operating effectively in all material respects in relation to fi nancial reporting risksYes7.4
261、Companies should provide the information indicated in the Guide to reporting on Principle 7YesPrinciple 8:Remunerate fairly and responsibly8.1The board should establish a remuneration committeeYes8.2Companies should clearly distinguish the structure of non-executive directors remuneration from that
262、of executive directors and senior executivesYes8.3Companies should provide the information indicated in the Guide to reporting on Principle 8YesNotes1.The board has chosen not to have a separate Nomination Committee,as explained in the section of this corporate governance statement entitled“Principl
263、e 2:Structure the board to add value”.2.APA Group intends to make publicly available information on procedures for the selection and appointment of the external auditor and for the rotation of external audit engagement partners.25APA ANNUAL REPORT 08DIRECTORS REPORT AUSTRALIAN PIPELINE TRUST AND ITS
264、 CONTROLLED ENTITIESAUSTRALIAN PIPELINE TRUST AND ITS CONTROLLED ENTITIES ARSN 091 678 778The directors of Australian Pipeline Limited(“APL”or“Responsible Entity”)submit the annual fi nancial report of Australian Pipeline Trust(“APT”or“Trust”)and its controlled entities(together“Consolidated Entity”
265、or“APA Group”)for the year ended 30 June 2008.This report and the fi nancial statements attached refer to the consolidated results of Australian Pipeline Trust and APT Investment Trust(together“APA”).DIRECTORSThe names of the directors of the Responsible Entity during and since the end of the fi nan
266、cial year are:Mr L F Bleasel,AMIndependent Chairman.Appointed director 28 August 2007.Appointed Chairman 30 October 2007.Mr J A FletcherIndependent Director.Appointed 27 February 2008.Mr R A Higgins,AOIndependent Director.Mr M MuhammadIndependent Director.Mr M RatilalIndependent Director.Appointed 3
267、1 July 2007.Mr R J WrightIndependent Director.Mr M J McCormackManaging Director.Mr G H BennettIndependent Chairman.Retired 30 October 2007.Mr R M GersbachRetired 1 February 2008.Details of directors,their qualifi cations,experience,special responsibilities and directorships of other listed entities
268、are set out on page 14.Alternate directors who served during the period are as follows:Ms W S SaidiAlternate for Mr M Muhammad.Mr W Z W Ariffi nAlternate for Mr M Ratilal.Appointed 31 July 2007.COMPANY SECRETARIESMr M T KnapmanAppointed 16 July 2008.Ms S M DureauAppointed 3 April 2008.Resigned 18 Ju
269、ly 2008.Mr A J V JamesResigned 29 April 2008.PRINCIPAL ACTIVITIESThe principal activities of the Consolidated Entity during the course of the fi nancial year were the ownership and operation of energy infrastructure,including:gas transmission and distribution businesses and investments located acros
270、s Australia;?other energy assets,including coal seam gas processing plants,gas fi red power stations,and electricity transmission?systems;and asset management and operations services for third parties,including all Envestra assets.?DIRECTORS REPORT(CONTINUED)26APA ANNUAL REPORT 08 AUSTRALIAN PIPELIN
271、E TRUST AND ITS CONTROLLED ENTITIESSIGNIFICANT CHANGES IN STATE OF AFFAIRSAPA acquired the Origin Energy Networks assets for$557.0 million.The assets comprise Origin Energy Asset Management,which provides management and operations services to Envestra,a 17.2%stake in Envestra,a one-third interest in
272、 the SEA Gas Pipeline,and a number of other smaller businesses.The acquisition of the SEA Gas Pipeline interest was completed on 29 June 2007,while the acquisition of the remaining assets was completed on 2 July 2007.The arrangements between APA,Alinta and the Babcock&Brown/Singapore Power Consortiu
273、m to terminate or transfer to APA the operating and maintenance services previously provided by Alinta for many of APAs gas transmission pipelines were completed on 2 October 2007.APA paid$206.2 million,resulting in the elimination of all fees and margins that were paid to Alinta and the transfer to
274、 APA of associated property,plant and equipment and Alinta personnel involved in the provision of services.In the opinion of the directors,there were no other signifi cant changes in the state of affairs of the Consolidated Entity during the fi nancial year that are not discussed elsewhere in this r
275、eport or in the fi nancial report.DISTRIBUTIONSDistributions paid to securityholders during the fi nancial year were:Final FY 2007 distribution paid 28 September 2007(1)Interim FY 2008 distribution paid 28 March 2008Cents persecurityTotaldistribution$000Cents persecurityTotaldistribution$000APT Divi
276、dend distribution2.08,6349.844,918APTIT Tax deferred distribution2.08,6342.712,375APTIT Interest income3.012,9512.09,167Total7.030,21914.566,460(1)Final FY 2007 distribution was a quarterly distribution for the period 1 April 2007 to 30 June 2007.On 26 August 2008 the directors declared a fi nal dis
277、tribution for APA for the current fi nancial year of 15.0 cents per security(“cps”)payable 10 September 2008,made up of:Final FY 2008 distribution payable 10 September 2008Cents persecurityTotaldistribution$000APT Dividend distribution9.042,142APTIT Tax deferred distribution2.813,110APTIT Interest i
278、ncome3.214,984Total15.070,236Total distribution for the fi nancial year is 29.5 cps,an increase of 1.5 cps(5.4%)over the prior year.FINANCIAL AND OPERATIONAL REVIEWUnderlying resultsThe underlying results for APA Group exclude one-off signifi cant items(refer Note 7 to the fi nancial statements)and
279、include two adjustments to revenue and earnings arising from their treatment under A-IFRS.Accordingly,the following items have been reclassifi ed to revenue and earnings in the underlying result:the capital distributions received from Envestra and the Mariner Income Trust,ie.the capital components o
280、f?$10,807,000 of the distributions received have been reclassifi ed to revenue and earnings(2007:$nil);and earnings from a number of complementary assets which are treated as fi nance leases under A-IFRS,ie.fi nance lease?principal repayments of$5,256,000,have been reclassifi ed to revenue(2007:$nil
281、).The directors are of the view that the underlying results provide a more accurate portrayal of the results of operations of APA Group.27APA ANNUAL REPORT 08DIRECTORS REPORT(CONTINUED)AUSTRALIAN PIPELINE TRUST AND ITS CONTROLLED ENTITIES The table below summarises the underlying results for key fi
282、nancial performance measures for the fi nancial year.Underlying results Year ended 30 June2008$0002007$000Changes$000%Total revenue897,792532,700365,09268.5EBITDA430,535296,842133,69345.0Interest(net)223,779136,62587,15463.8Operating profi t after tax and minorities82,21964,53017,68927.4Operating ca
283、sh fl ow(1)192,117150,60841,50927.6Operating cash fl ow per security(cents)42.739.73.07.6Earnings per security(cents)18.317.01.37.6Distribution per security(cents)29.528.01.55.4(1)Operating cash fl ow=net cash from operations after interest and tax payments,adjusted for signifi cant items.Underlying
284、 profi t APA Group reported underlying operating profi t after tax and minorities of$82,219,000 for the fi nancial year,an increase of 27.4%compared with$64,530,000 reported last year.The main factors driving the increase in underlying profi t include:increased gas transmission revenue across the ma
285、jority of APAs gas pipelines,particularly from Western Australia?and New South Wales;full 12 month contributions of gas businesses acquired in the previous and current fi nancial years,including the?Victorian Transmission System and Telfer Gas Pipeline,APA Gas Network(Allgas),Directlink,and the Orig
286、in Energy Network businesses and assets;partial and fi rst full 12 month contributions of complementary assets developed and commissioned in the previous?and current fi nancial years,including Daandine Power Station,Tipton West Gas Processing Plant,and the X41 Power Station and associated pipelines;
287、and operating and maintenance cost savings and capital expenditure savings achieved through direct control of all APA?assets,in particular,through the termination in October 2007 of the Alinta Pipeline Management Agreement which provided operational services to APAs foundation gas transmission pipel
288、ines.RevenueUnderlying revenue was$897,792,000,a 68.5%increase on last year of$532,700,000.Revenue was$614,918,000 after removing pass-through revenue totalling$282,874,000(2007:$95,911,000).This is a 40.8%increase on the equivalent revenue from last year.Earnings per securityUnderlying earnings per
289、 security calculated on a weighted average basis,for the fi nancial year was 18.3 cps,an increase of 7.6%compared to 17.0 cps last year.The weighted average number of securities on issue during the fi nancial year was 450,262,000,up from 379,551,000 last year due to capital raising activities.Operat
290、ing cash fl owUnderlying operating cash fl ow per security grew by 3.0 cps to 42.7 cps,an increase of 7.6%compared to 39.7 cps last year.Cash generation from new and existing businesses grew strongly by 27.6%to$192,117,000 exceeding the additional costs of debt in the year,and more than covering dis
291、tributions returned to securityholders.On a per security basis,APA achieved its target of growing operating cash fl ow by at least 5%per annum.DistributionsAPA Groups distributions for the fi nancial year totalled 29.5 cps,an increase of 5.4%,or 1.5 cps on last year,achieving its distribution growth
292、 target of at least 5%for the full year.APA retains its target of continued growth of distributions of at least 5%per annum in the medium term while maintaining a prudent payout ratio.The distribution payout ratio for the fi nancial year was 71.2%,further demonstrating APAs ability to pay fully fund
293、ed distributions out of operating cash fl ows each year.Statutory resultsExcluding underlying adjustments and after signifi cant items,reported profi t attributable to APA securityholders for the fi nancial year was$67,192,000,an increase of$10,432,000 or 18.4%above$56,760,000 reported last year.DIR
294、ECTORS REPORT(CONTINUED)28APA ANNUAL REPORT 08 AUSTRALIAN PIPELINE TRUST AND ITS CONTROLLED ENTITIESThe following table provides a summary of key fi nancial data for the year:Statutory resultsYear ended 30 June2008$0002007$000Changes$000%Operating results before signifi cant itemsGas transmission an
295、d distribution revenue485,530394,07691,45423.2Electricity transmission revenue25,22817,1938,03546.7Asset management revenue42,8536,72636,127537.1Complementary/other revenue29,6574,03025,627635.9Other income interest15,58714,7648235.6Total revenue excluding pass-through598,855436,789162,06637.1Pass-t
296、hrough revenue(1)282,87495,911186,963194.9Total revenue881,729532,700349,02965.5EBITDA414,472296,842117,63039.6Depreciation and amortisation(94,459)(69,783)(24,676)35.4EBIT320,013227,05992,95440.9Net interest expense(223,779)(136,625)(87,154)63.8Pre-tax profi t96,23490,4345,8006.4Income tax expense(
297、24,766)(25,802)1,036(4.0)Minorities(56)(102)46(45.1)Operating profi t after tax and minorities,before signifi cant items71,41264,5306,88210.7Signifi cant items after income tax(4,220)(7,770)3,550-Profi t after income tax and minorities67,19256,76010,43218.4(1)Pass-through revenue is revenue on which
298、 no margin is earned.Pass-through revenue arises in the NT Gas business and the Asset management operations on Envestra assets.Signifi cant items in the current period amounted to$6,029,000($4,220,000 after tax)and relate to“one-off”costs associated with the integration of the newly acquired busines
299、ses($4,350,000),unsuccessful acquisition due diligence costs($1,343,000)and a small revaluation loss on interest rate hedges which are deemed ineffective,acquired as part of the GasNet acquisition($336,000).Segment performanceAPAs operations and fi nancial performance in the fi nancial year refl ect
300、 full and part year contributions of acquired businesses(current year and prior year),growth in existing businesses,and benefi ts achieved through the continued integration of recently acquired businesses into its internal management model.Underlying revenue and EBITDA performance of APAs business s
301、egments is tabled below.Year ended 30 June2008$0002007$000Changes$000%RevenueGas transmission and distribution498,604394,076104,52826.5Queensland133,596108,19025,40623.5New South Wales82,34875,3806,9689.2Victoria102,04966,62835,42153.2South Australia 19,687-19,687-Western Australia142,489128,72513,7
302、6410.7Northern Territory18,43515,1533,28221.7Electricity transmission25,22817,1938,03546.7Asset management42,8536,72636,127-Complementary assets34,9134,03030,883766.3Total601,598422,025179,57342.6Pass-through revenue282,87495,911186,963194.9Unallocated revenue13,32014,764(1,444)(9.8)Total underlying
303、 revenue897,792532,700365,09268.529APA ANNUAL REPORT 08DIRECTORS REPORT(CONTINUED)AUSTRALIAN PIPELINE TRUST AND ITS CONTROLLED ENTITIESYear ended 30 June2008$0002007$000Changes$000%EBITDAGas transmission and distribution368,274275,77592,49933.5Queensland95,83973,83122,00829.8New South Wales66,82346,
304、53020,29343.6Victoria75,18750,32524,86249.4South Australia 19,538-19,538-Western Australia107,872100,6897,1837.1Northern Territory3,0154,400(1,385)(31.5)Electricity transmission18,93912,8426,09747.5Asset management25,4615,71519,746-Complementary assets17,8612,51015,351611.6Total underlying EBITDA430
305、,535296,842133,69345.0Gas transmission and distribution revenue(excluding pass-through revenue)was$498,604,000,an increase of 26.5%on$394,076,000 last year.The increase was principally due to the full 12 month contributions of gas businesses acquired in the previous and current fi nancial years,incl
306、uding the Victorian Transmission System,APA Gas Network(Allgas),the SESA Pipeline,and the investments in the SEA Gas Pipeline and Envestra($62,220,000)and increased revenue across the majority of pipelines($42,308,000).Revenue from the Moomba Sydney Pipeline increased by$6,968,000 due to additional
307、pipeline services,primarily as a result of increased gas demand in July and August 2007 and new contracted services for the 2008 winter period.Gas transportation revenues in Western Australia increased by$13,764,000 due to increased third party demand,particularly from the mining sector,and despite
308、the gas supply impacts caused by the Varanus Island incident in June 2008.EBITDA increased by 33.5%to$368,274,000 refl ecting both the additional revenue outlined above and reduced operating expenses resulting from synergy benefi ts and the removal of third party operating fees since October 2007.El
309、ectricity transmission revenue increased by$8,035,000 to$25,228,000(2007:$17,193,000)due to a full 12 months contribution from the Directlink business acquired in February 2007.Asset management revenue refl ects the fi rst 12 months of revenue(excluding cost recovery revenue)from providing asset man
310、agement,operating and maintenance services to Envestra and nine months revenue from providing operating and maintenance services to the Moomba Sydney Ethane Pipeline.Complementary assets revenue of$34,913,000 is made up of contributions from the Tipton West Gas Processing Plant and Daandine Power St
311、ation,seven month contribution from the X41 Power Station,and 12 month contribution from NGV and cogeneration businesses acquired as part of the Origin Energy Networks acquisition in July 2007.Operational highlightsOperating highlights are provided in the Managing Directors Report and Operations Rep
312、ort on pages 6 to13.Finance and other activitiesCapital management During the current fi nancial year,APA undertook capital raising activities to fund the continuing growth of the business.APA raised$123,995,000 in equity through offerings as detailed below:in September 2007 and March 2008,$38,968,0
313、00 was raised through the operation of the Distribution Reinvestment?Plan resulting in the issue of 12.9 million securities;and in November 2007,the Security Purchase Plan raised$85,027,000 from existing securityholders,resulting in the issue?of 23.7 million securities.APA completed the refi nancing
314、 of a number of its debt facilities in June and July 2007.APAs new syndicated debt facility was oversubscribed and subsequently increased to$2.0 billion.In July 2008,APA refi nanced$150 million Medium Term Notes(“MTNs”)and added another$15 million to its debt facilities.APAs only refi nancing obliga
315、tion in 2009 is its$300 million MTNs due in March 2009.DIRECTORS REPORT(CONTINUED)30APA ANNUAL REPORT 08 AUSTRALIAN PIPELINE TRUST AND ITS CONTROLLED ENTITIESAPAs debt portfolio has a healthy spread of maturities extending out to 2022,and with an average maturity of 5.0 years.APA was geared at 72.0%
316、at 30 June 2008,down slightly on 2007.At 30 June 2008,APA had in excess of$500 million in cash and committed undrawn facilities available at the contracted margins to meet the capital growth needs of the business.APA has a prudent treasury policy which requires conservative levels of hedging of inte
317、rest rate exposures to minimise the potential impacts from adverse movements in rates.All interest rates and exchange rates on project debt and US Private Placement facilities have been fi xed for the life of the respective facilities.APA also enters into interest rate hedges which fi x a proportion
318、 of the interest rate exposure on the syndicated facility.At 30 June 2008,66%of all interest rate exposures were either hedged or at fi xed interest rates,for varying periods extending out as far as 14 years.In addition,a level of interest rate protection is provided through CPI indexing in revenue
319、contracts and the regulatory revenue reviews applicable to many of APAs assets.Borrowings and fi nance costsAs at 30 June 2008,APA had borrowings of$3,401 million,principally from syndicated debt facilities,US Private Placement notes and other medium-term notes,compared to$2,720 million as at 30 Jun
320、e 2007.Borrowings increased due to the funding of the acquisitions of the Origin Energy Network assets and the Alinta operating and maintenance activities,and due to organic capital expenditure projects.Net underlying fi nance costs increased by$87,154,000 or 63.8%to$223,779,000 in the current fi na
321、ncial year.The increase is a result of additional borrowings and from recent rises in interest rates impacting on the unhedged portion of the debt portfolio.APAs debt covenant Interest Cover Ratio for the fi nancial year was 1.86 times,well in excess of its default ratio of 1.1 times.Income taxThe e
322、ffective tax rate before signifi cant items has decreased to 25.7%in comparison to the previous year of 28.5%.This is largely due to the operation of APTIT,which is a pass-through entity for tax purposes.Capital expenditureCapital expenditure for the year totalled$227,347,000 with 95%allocated to gr
323、owth projects,including the Northern Territory Bonaparte Gas Pipeline,Brooklyn Lara Pipeline and compressor station in Victoria,X41 Power Station in Queensland,and the Culcairn compressor on the Moomba Sydney Pipeline System.Growth capital expenditure is generally either fully underwritten through l
324、ong-term gas transportation arrangements or has had regulatory approval through the relevant Access Arrangement.Securityholder base and distributionsOn 31 August 2007,Alintas 35%equity interest in APA was distributed in-specie to Alinta shareholders.As a result,APAs securityholder base expanded from
325、 approximately 28,000 to 130,000.As at 30 June 2008,106,392 securityholders hold 468,241,154 APA securities.During the year,the board changed the frequency of distributions from quarterly to semi-annually and maintained the Distribution Reinvestment Plan.Regulatory mattersRegulatory matters during t
326、he year are outlined on page 11.ENVIRONMENTAL REGULATIONSAll pipeline,distribution and gas processing assets owned and/or operated by APA are designed,constructed,tested,operated and maintained in accordance with pipeline and distribution licences issued by the relevant State and Territory technical
327、 regulators.All licences require compliance with environmental legislation and Australian standards.The pipeline licences also require compliance with the Australian Standard AS 2885“Pipelines-Gas and Liquid Petroleum”,which has specifi c requirements for the management of environmental matters asso
328、ciated with all aspects of the high pressure pipeline industry.Environmental management plans satisfying Part A of the Australian Pipeline Industry Association Code of Environmental Practice are prepared and independently audited for construction activities.In accordance with Part 3 of AS 2885,envir
329、onmental management plans satisfying Part B of the Code are in place for all operating pipelines and are managed in accordance with the terms and conditions of the applicable licences.31APA ANNUAL REPORT 08DIRECTORS REPORT(CONTINUED)AUSTRALIAN PIPELINE TRUST AND ITS CONTROLLED ENTITIESThe Safety and
330、 Operating plan for APAs distribution network has been audited in accordance with the Queensland and NSW technical regulator requirements.The board reviews external audit reports and,on a monthly basis,the internal reports prepared relating to environmental issues.No breaches have been reported duri
331、ng the fi nancial year and APA has managed the assets in accordance with the environmental management plans that are in place.APAs electricity transmission assets are designed,constructed,tested,operated and maintained in accordance with the requirements of its transmission licences complying with r
332、elevant Australian and State environmental legislation and Australian standards.Environmental management plans for each asset are in place for all operating activities and are managed in accordance with the terms and conditions of applicable licences.X41 Power Station is designed,constructed,tested
333、and maintained in accordance with an agreement with MIM Limited.The agreement requires compliance with relevant Australian and State environmental legislation and Australian standards.Daandine Power Station is designed,constructed,tested,operated and maintained in accordance with the requirements of its generation authority.A permit has been issued by the QLD Environmental Protection Agency in res
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