Endeavour Energy Annual Performance Report - Parliament of New ...
Endeavour Energy Annual Performance Report - Parliament of New ...
Endeavour Energy Annual Performance Report - Parliament of New ...
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To that end, we pursued our<br />
second year <strong>of</strong> our organisationwide<br />
plan to improve customer<br />
value through cost reductions<br />
and efficiency programs<br />
identified by our employees.<br />
This plan is expected to deliver<br />
savings <strong>of</strong> $35 million over three<br />
years, exceeding our voluntary<br />
commitment to the Australian<br />
<strong>Energy</strong> Regulator to reduce<br />
operating costs by 2% per year<br />
from 2009–2014.<br />
We remain focused on further<br />
improving customer value in<br />
2011–12, with plans to reduce<br />
corporate overheads by $22 million<br />
per year by 2013–2014 and reduce<br />
costs in our regional operations<br />
by $26 million per year without<br />
compromising safety or reliability.<br />
These and other initiatives will<br />
assist us to control increases in our<br />
network tariffs to around CPI for<br />
the next two years.<br />
Retail business assets sale<br />
We unveiled our new brand<br />
‘<strong>Endeavour</strong> <strong>Energy</strong>’ on<br />
1 March 2011 following the sale<br />
<strong>of</strong> our retail business assets to<br />
Origin <strong>Energy</strong>. <strong>Endeavour</strong> means<br />
‘to make a serious and sincere<br />
effort’ and that resonates with our<br />
commitment to safely delivering a<br />
reliable, sustainable and efficient<br />
network for all our customers.<br />
Our Transition Services Agreement<br />
(TSA) with Origin <strong>Energy</strong> began<br />
in March and covers sale-related<br />
issues such as transitioning retail<br />
intellectual property, people<br />
and processes, including our call<br />
centre and retail billing functions.<br />
This work is being completed<br />
against the backdrop <strong>of</strong> the NSW<br />
Government’s plans to merge<br />
NSW’s three electricity distribution<br />
businesses into two distributors.<br />
Industry restructure<br />
These industry restructure plans<br />
are intended to save $400 million<br />
in combined operating costs over<br />
four years, by reducing overheads<br />
and delivering economies <strong>of</strong><br />
scale. These savings will further<br />
contribute to our own efficiency<br />
initiatives and help fund rebates<br />
for people struggling to pay<br />
electricity bills.<br />
Strong financial results<br />
As a state-owned corporation<br />
we have an obligation to pay a<br />
dividend to our shareholder, the<br />
NSW Government. The dividend<br />
is calculated as 70% <strong>of</strong> our net<br />
pr<strong>of</strong>it after tax. We returned<br />
$266 million in distributions,<br />
including income tax equivalents,<br />
to our shareholder in 2010–11<br />
and delivered a net pr<strong>of</strong>it after<br />
tax <strong>of</strong> $245 million.<br />
Michael McLeod<br />
Chairman<br />
A clear way forward<br />
Notwithstanding the challenges<br />
experienced in the past year, we<br />
have made significant progress<br />
in improving the reliability <strong>of</strong> our<br />
network, reducing operating<br />
expenditure and building on solid<br />
strategic plans to continually<br />
improve the performance <strong>of</strong><br />
our business.<br />
On behalf <strong>of</strong> the Board and the<br />
Executive Leadership Team, we<br />
extend our thanks and appreciation<br />
to the serious and sincere effort<br />
made by the people <strong>of</strong> <strong>Endeavour</strong><br />
<strong>Energy</strong> to achieve these outcomes.<br />
With ongoing support we will<br />
continue to provide reliable, valuefor-money<br />
services to the 2.1 million<br />
Australians who depend on us for<br />
energy, and ensure a safe working<br />
environment for our employees,<br />
customers and communities,<br />
every day.<br />
Vince Graham<br />
Chief Executive Officer<br />
<strong>Endeavour</strong> <strong>Energy</strong> <strong>Annual</strong> <strong>Performance</strong> <strong>Report</strong> 2010–11<br />
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