51
2017 WEL Networks
|
Annual Report
wel.co.nz
WEL NETWORKS LIMITED
Notes to the financial statements
For the year-ended 31 March 2017
(continued)
The key assumptions used in the valuation of the Fibre Network as at 31 August 2016 include
the following assumptions:
The Group’s fibre network was revalued as at 31 August 2016 by Ernst & Young. The fair values were established in
accordance with NZ IFRS-3 Business combinations and were deemed cost to WEL Networks Limited. The valuation
was prepared using discounted cash flow methodology.
Key Assumptions include:
Weighted Average Revenue Per User (ARPU) of $48.75 in 2016/2017 increasing to $50.81 in 2023 and beyond.
New Connections of 100,000 over the next 40 years.
Uptake terminal penetration of 70% reached by 2022.
Weighted average connection costs of $1,492 in 2016/2017, increasing by inflation over the next 40 years.
9 CONSTRUCTION WORK IN PROGRESS
2017
$’000
2016
$’000
Amounts expected to be recovered with 12 months
-
29,492
Amounts expected to be recovered after more than 12 months
-
2,570
-
32,062
Made up of:
-
-
Layer one
-
23,062
Layer two
-
(10,812)
Connections
-
19,812
-
32,062
Analysed as:
-
-
Contract costs incurred
-
312,689
Less: progress billings
-
(280,627)
-
32,062
Revenue from construction contracts
-
82,576
