INFRASTRUCTURE INDUSTRY
TRAINING ORGANISATION
Formerly trading as
The Electricity Supply Industry Training Organisation (ESITO)
and InfraTrain New Zealand Ltd
ANNUAL REPORT
for the year ended 31 December 2013
Chair’s Report
The pace of change in the industry training sector
continued to gain momentum during 2013. The number
of Industry Training Organisations (ITOs) decreased
significantly with several merging to form new entities.
There were 21 ITOs at the beginning of 2013, shrinking
to 14 within a twelve month period. This number is set to
decrease further in 2014.
On 1 October, InfraTrain New Zealand merged with the Electricity
Supply Industry Training Organisation (ESITO) to form a niche ITO with
the capability to meet the specific needs of the infrastructure sector. A
significant factor underpinning the concept of an infrastructure centric
ITO, and ultimately the merger, was a desire for closer alignment to
Government policy. Developing New Zealand’s infrastructure through a
National Infrastructure Plan has been identified as a key area forming the
Governments Business Growth Agenda.
The merger followed a period of sustained and detailed consultation
between InfraTrain and ESITO and their respective industries, and was
approved by the Minister of Tertiary Education, Skills and Employment Hon Steven Joyce in June 2013.
The merger proposal and process was acknowledged by the Tertiary Education Commission (TEC) as being of a
high calibre, and this is to the credit of the respective Boards and management teams of both ITOs, as well as the
Joint Merger Committee. It is our intention to continue to work collaboratively and collectively with the TEC as the
new organisation becomes established.
As a member of the former ESITO Board, I am delighted to have the
opportunity to act as Chair for the new organisation at such an exciting
and challenging time. Collectively, we are now in a far stronger position
than the two organisations were previously. We have a new Board
of a very high calibre. The new governance framework gives equal
representation to both the civil and electrical sectors, and a governance
structure that gives an equal voice to all representatives.
Frances Hague (Chair)
Capability Consulting
ESITO
From a strategic perspective, we face a number of challenges going
forward. Perhaps the most significant of these is the disparity between
the Government focus on longer term qualifications versus industry need
for ‘just in time’ training to meet market requirements. While seeking to
address this, we will continue to focus on the needs of all stakeholders to
ensure satisfactory outcomes for all.
Alister Harlow
New Zealand Roadmarkers Federation Inc.
InfraTrain
As a result of the merger, we are committed to delivering major gains
for our customers in both the civil and electrical sectors – and we look
forward to working with you to achieve this.
Infrastructure ITO Board
John Foote
Mighty River Power Ltd
ESITO
Gavan Jackson
Electrix Ltd
ESITO
Don Pryde
Delta Utility Services
ESITO
Don Tilbrook
Brian Perry Civil
InfraTrain
Brian Warren
The Isaac Construction Co Ltd
InfraTrain
Frances Hague
Chair
1
Chief Executive Officer’s Report
2013 was a year of significant change in the Industry
Training Organisation (ITO) sector, particularly in
regard to the rationalisation of ITOs.
The merger between InfraTrain New Zealand and the Electricity
Supply Industry Training Organisation (ESITO) was one of several
which took place and set a high standard for others to follow. The
merger process was entirely voluntary, and took place with the full
support and involvement of employers and the relevant industry
associations. The resulting organisation is a strong, commerciallyviable ITO which has been welcomed by industry and is well equipped
to service the wider infrastructure sector.
The success of the merger was due in no small part to the
achievements of the previous management teams and Boards of
InfraTrain and ESITO. Both organisations underwent a series of
changes to strengthen their financial viability and performance during
2011 and 2012, which enabled them to enter into the merger in a
strong position. By 2013, InfraTrain was operating at a profit for the
first time in several years, despite incurring significant merger costs.
ESITO also made excellent gains during 2013, with high qualification
completion rates.
The merger process itself was well executed, and the new organisation came into being on 1 October 2013. The
merger had a minimal impact on existing InfraTrain and ESITO customers, with business as usual continuing
uninterrupted. I would like to acknowledge the role of the Board, management team and Joint Merger Committee
who all played an integral role in enabling this to happen.
So far, the newly-formed Infrastructure ITO is making great progress, and I have been extremely impressed by the
quality and commitment of the staff working for the organisation. They have shown real optimism and enthusiasm
to do something extraordinary in 2014 and beyond.
Our immediate priority is to focus on becoming a high-performing ITO, particularly in terms of financial
performance, growth and operational excellence. Ultimately our aim is to become a one-stop-shop for
infrastructure industry training – not just an infrastructure ITO but the infrastructure ITO for New Zealand.
To achieve this success we will ensure our work reflects both the common and different requirements of the
industries and customers we serve. However, in all cases our operational improvements will have the same aim –
to add value to the industries and trainees we serve, while meeting the needs and objectives of our stakeholders
such as the Tertiary Education Commission (TEC).
Ngā Mihi
Helmut Modlik
Chief Executive Officer
2
Statement of comprehensive income &
Statement of changes in equity
for the year ended 31 December 2013
Statement of comprehensive income
December 2013
$NZD
December 2012
$NZD
3,795,364
3,273,733
173,562
240,244
Other income
2,080,510
813,198
InfraTrain NZ Ltd - net assets acquired for nil consideration
2,181,044
-
8,230,480
4,327,175
255,761
239,853
2,528,646
1,998,561
814,452
657,965
2,955,184
2,070,146
189,823
-
6,743,866
4,966,525
Profit/(loss) for the year
1,486,614
(639,350)
Total comprehensive income for the year
1,486,614
(639,350)
Income
Grant income
Interest income
Expenses
Depreciation and amortisation expense
Employee benefits expense
Other administration expense
Other operating expense
Merger expenses
Statement of changes in equity
Retained earnings
$NZD
Balance as at 1 January 2012
3,900,581
Total comprehensive income for the year
(639,350)
Balance as at 31 December 2012
3,261,231
Total comprehensive income for the year
1,486,614
Balance as at 31 December 2013
4,747,845
The summary financial statements have been extracted from the full financial statements of Infrastructure ITO.
These summary financial statements cannot be expected to provide as complete an understanding as the full financial statements.
A copy of the full financial statements and the unmodified auditor’s report can be obtained from Infrastructure ITO at 40 Mercer St,
Wellington.
All differential reporting concessions were applied in preparing the full financial statements.
These summary financial statements comply with FRS-39.
3
Statement of financial position
for the year ended 31 December 2013
December 2013
$NZD
December 2012
$NZD
4,747,845
3,261,231
Cash and cash equivalents
232,124
537,776
Trade and other receivables
844,635
275,244
Other assets - prepayments
49,890
12,320
5,359,997
3,186,077
12,670
-
6,499,315
4,011,417
Property, plant & equipment
458,646
75,615
Intangibles
403,884
566,026
862,530
641,641
7,361,844
4,653,058
813,438
519,995
98,157
163,042
1,702,404
708,790
2,613,999
1,391,827
Total liabilities
2,613,999
1,391,827
Net Assets
4,747,845
3,261,231
Equity
Retained earnings
Current assets
Term deposits
Inventories
Non current assets
Total assets
Current liabilities
Trade and other payables
Employee benefits
Deferred revenue
4
Statement of cash flows
for the year ended 31 December 2013
December 2013
$NZD
December 2012
$NZD
3,790,472
2,176,285
Interest received
173,216
252,969
GST paid
123,082
2,327
2,045,020
804,681
Payments to suppliers
(2,831,624)
(2,124,568)
Payments to employees
(2,807,923)
(2,199,685)
Training subsidy payments
(1,089,573)
(612,848)
(597,330)
(1,700,839)
(190,357)
(15,814)
-
14,446
(16,671)
(10,144)
(1,899,998)
2,100,000
2,398,704
-
291,678
2,088,488
-
-
Net movement in cash
(305,652)
387,649
Opening cash balance
537,776
150,127
Closing cash and cash equivalents
232,124
537,776
Cash flow from operating activities
Receipts from grants
Receipts from other income
Net cash (used in) / generated by operating activities
Cash flow from investing activities
Purchase of property, plant and equipment
Proceeds from disposal of property, plant and equipment
Purchase of intangible assets
Investment in term deposits
Cash on acquisition of Infratrain
Net cash (used in) / generated by investing activities
Cash flow from financing activities
Cash was applied to:
Net cash (used in)/generated by financing activities
5
Auditors report
6
Infrastructure Industry Training Organisation
Head Office
Level 12, Simpl House
40 Mercer Street
Wellington 6140
New Zealand
Freephone: 0800 486 626
www.infrastructureito.org.nz