WWU Regulatory Accounts to 31st March 2006 - Our Home Page

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DIRECTORS AND ADVISORS Duncan Whyte (R, H) Chairman Graham Edwards Chief Executive Officer Stephen Box (A, H) James Dickson Philip Garling Howard Higgins (H) Christopher Koski Wayne Leamon (A, R) Martin Stanley (R) Steven Bickerton (Alternate Director to Philip Garling) Charles Hazelwood (Alternate Director to Graham Edwards) David Owens (Alternate Director to Martin Stanley, Wayne Leamon and Howard Higgins) (A) (R) (H) Member of the Audit Committee Member of the Remuneration Committee Member of the Health & Safety Committee COMPANY SECRETARY AND REGISTERED OFFICE Christopher Talbot Ferry Road, Cardiff, CF11 0XR AUDITORS PricewaterhouseCoopers LLP 1 Kingsway, Cardiff CF10 3PW PRINCIPAL BANKERS Barclays Bank plc Subsequent to 21 June 2006, the date on which the statutory accounts were signed, the following changes in the above information occurred: • James Dickson resigned as a director of the Company with effect from 12 September 2006, • Anthony Clamp was appointed as a director of the Company with effect from 21 September 2006, • Duncan Whyte, Howard Higgins and Anthony Clamp were appointed to the Audit Committee, Wayne Leamon resigned from the Audit Committee, with effect from 21 September 2006. • With effect from 26 June 2006 the Registered Office of the Company was changed to: Wales & West House, Spooner Close, Coedkernew, Newport, NP10 8FZ Wales & West Utilities Ltd (Formerly Blackwater 2 Ltd) 2
OPERATING & FINANCIAL REVIEW IN RESPECT OF THE ELEVEN MONTHS ENDED 31 MARCH 2006 Introduction Wales & West Utilities Ltd (“The Company”) is a regulated gas transportation business owning and operating the principal gas distribution network in Wales and the South West of England. The Company operates under a Gas Transporter’s licence granted by the Gas and Electricity Markets Authority. History & development of the business The Company (formerly known as Blackwater 2 Ltd) was a dormant company wholly owned by National Grid Gas plc (NGG) (then called Transco plc) up until 1 May 2005 at which time the Gas Distribution Business for the Wales and South West Local Distribution Zones was transferred into it. On 1 June 2005 NGG sold its entire shareholding in the Company to MGN Gas Networks (Senior Finance) Ltd. Regulatory environment The Company is a private company. Details of the immediate and ultimate parent companies are set out in note 27 to the statutory financial statements. The gas distribution business of the Company is regulated by the Office of Gas & Electricity Markets (Ofgem). Ofgem operates under the direction and governance of the Gas and Electricity Markets Authority, which makes all major decisions and sets policy priorities for Ofgem. Other performance measures The Company uses a number of measures of operational and financial performance to plan and monitor its business. The Company’s core business is as a regulated gas network infrastructure utility and therefore many of the targets are determined by Ofgem. Safety performance is reportable to the Health & Safety Executive and measurement is again based on important regulatory targets. Much of the Company’s performance depends on meeting and exceeding those regulatory targets and improving safety performance. Measures of operational performance include: • Lost Time Injuries (LTIs), • The management of controllable costs in relation to the regulated business • Reliability of the gas distribution network and other customerfacing quality of service measures The Directors believe that safety is paramount and, as a fundamental part of this, that all work related injuries and illnesses are preventable. Consequently the Company measures the level of LTIs as a key operational performance indicator. LTIs are injuries that arise from a person’s employment and cause that person to be unable to attend the workplace and perform his or her duties for one or more shifts or working days. All the Company’s operations are required to report LTIs suffered by their respective employees and contractors. The level of controllable costs is another key measure. The Company’s ability to make an operating profit depends largely on the ability to manage those of the Company’s costs that can be controlled. Controllable costs include employment costs and other costs incurred in operating and maintaining the distribution system. Ofgem monitors the Company’s performance in a number of areas and the ability to reduce controllable costs is important in this process. Reliability of the gas distribution network is monitored by Ofgem in a number of ways, including the number and duration of interruptions to customers’ gas supplies. The Company is required to meet a number of different customer service targets which are set out in a determination by Ofgem (“Overall Standards”); these include attendance at gas escapes, notifying customers in advance of planned interruptions and responding to complaints. Compensation payments for customers are detailed in the Gas (Standards of Performance) Regulations 2005, including for example, payments for customers whose gas supply has been interrupted by an unplanned incident, as well as payments for failing to Wales & West Utilities Ltd (Formerly Blackwater 2 Ltd) 3
Page 1 and 2: Wales & West Utilities Limited REGU
Page 3: IMPORTANT INFORMATION Wales & West
Page 7 and 8: The Company was allocated a regulat
Page 9 and 10: Financial review Basis of accountin
Page 11 and 12: FINANCIAL RISK MANAGEMENT (continue
Page 13 and 14: DIRECTORS’ INTERESTS There were n
Page 15 and 16: CORPORATE GOVERNANCE STATEMENT STAT
Page 17 and 18: DIRECTORS' RESPONSIBILITIES FOR PRE
Page 19 and 20: Basis of audit opinion We conducted
Page 21 and 22: STATEMENT OF TOTAL RECOGNISED GAINS
Page 23 and 24: CASHFLOW STATEMENT FOR THE ELEVEN M
Page 25 and 26: TURNOVER Turnover represents the sa
Page 27 and 28: DECOMMISSIONING AND ENVIRONMENTAL C
Page 29 and 30: NOTES TO THE REGULATORY ACCOUNTS FO

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