apr-11.pdf (2.07 MB) - Crown Ownership Monitoring Unit

OperationsSince the 2008/09 GFC and the flow-on impact on the New Zealand housingmarket, QV has been negatively affected by the significant reduction inproperty sales, and limited capital available for industrial and commercialproperty developments. QV is continuing to respond to this economicenvironment by renewing its focus on customer needs, and deliveringinnovative solutions, such as launching mobile technology in the field whichallows QV valuers to record property-specific information on mobile devices.In 2010/11, QV’s performance has been adversely affected primarily byits subsidiary’s performance – Darroch Limited. Darroch’s underlyingperformance has largely been affected by integration issues with DTZNew Zealand Limited MREINZ (DTZ), which was acquired by QV in 2009/10.Financial performanceQV’s performance in 2010/11 has been disappointing, with a net loss aftertax of $2.2 million. This compares unfavourably with QV’s performanceover the past five years. The reduction in profitability in 2010/11 was mainlybecause of higher than planned expenses (compared to budget), particularlya $2.1 million goodwill impairment charge in relation to Darroch’s underlyingvalue.Performance against planQV’s last four annual plans have each forecast profitability growth, while actualperformance has been below the plan figures (note: 2007/08 actual is adjustedfor a one-off gain related to the Property IQ joint venture). In 2010/11, thoughQV achieved its revenue targets, its underlying performance was poor owingto expenses being higher than planned which translated to a net loss aftertax of $2.2 million, compared to a budgeted profit of $700,000. QV’s nextthree years’ financial forecast is predicated on the market recovering and QVbeing able to achieve continued business growth. However, QV’s continuedpoor performance in 2010/11 is of concern, and we are looking forward to asignificant improvement in performance in the period ahead.DividendsOwing to its adverse financial performance, QV has not paid a dividend in2010/11. However, dividend payments are expected to resume in the 2011/12financial year.Major investmentsIn 2010/11, QV invested $283,000in its subsidiary and joint venturecompanies and purchasing fixedassets. QV’s 2010/11 investmentswere significantly below plan (92%below plan) owing to deferredinvestments.Non-financial performanceQV’s non-financial performanceindicators are mostly around thequality of service provided. QVhas achieved four of its sevenperformance targets for 2010/11.The areas where QV was belowtarget include users ranking QV’swebsite as good or excellent (actual80% versus target 85%), and theaccuracy and integrity of propertydata on QV’s website is rankedas good or excellent (actual 63%versus target 75%).Corporate social responsibilityFollowing the earthquakes inCanterbury, QV supported itsstaff and its families, and alsocontributed to the mayoral relieffunds, which were targeted to assistpeople affected by the earthquakes.QV is focused on minimising itscarbon footprint in the key areasof power and fuel consumption. In2010/11, QV has reduced its powerconsumption by 4.7% and fuelconsumption by 1.68%.page | 95