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H4. Deed of cross guarantee

NBN Co Limited and NBN Tasmania Limited (NBN Tasmania) are parties to a deed of cross guarantee under which each company guarantees the debts for the other. By entering into the deed, the wholly-owned entities have been relieved from the requirement to prepare a Financial Report and Directors’ report under the ASIC Corporations (Wholly-owned Companies) Instrument 2016/785.

Statement of profit or loss and other comprehensive income, Statement of financial position and Summary of movements in accumulated losses

NBN Co Limited and NBN Tasmania Limited represent a ‘closed group’ for the purpose of the Class Order and as there are no other parties to the deed of cross guarantee, they also represent the ‘extended closed group’.

Set out on the following pages are a Statement of profit or loss and other comprehensive income, Statement of financial position and a Summary of movements in accumulated losses for the year ended 30 June 2020 of the closed group.

Statement of profit or loss and other comprehensive income

NBN Co & NBN Tasmania

30 June 2020

30 June 2019

For the year ended

$m

$m

Revenue

3,836

2,824

Direct network costs

(641)

(746)

Employee benefits expenses

(877)

(867)

Other operating expenses

(554)

(609)

Subscriber costs

(2,414)

(1,903)

Depreciation and amortisation

(3,151)

(2,611)

Other income

24

23

Net finance costs

(1,460)

(991)

Loss before income tax

(5,237)

(4,880)

Income tax (expense)/benefit

(1)

1

Loss for the year

(5,238)

(4,879)

Loss attributable to the shareholder

(5,238)

(4,879)

Other comprehensive gain/(loss)

Items that may be reclassified to profit or loss

Changes in the fair value of cash flow hedges, net of tax

2

3

Total other comprehensive gain/(loss) for the year, net of tax

2

3

Total comprehensive loss for the year

(5,236)

(4,876)

Total comprehensive loss attributable to the shareholder

(5,236)

(4,876)

Statement of financial position

NBN Co & NBN Tasmania

30 June 2020

30 June 2019

As at

$m

$m

Current assets

Cash and cash equivalents

344

520

Trade and other receivables

512

444

Inventories

-

39

Derivative financial assets

5

6

Other current assets

129

116

Total current assets

990

1,125

Non-current assets

Derivative financial assets

-

2

Property, plant and equipment

33,738

29,443

Intangible assets

2,064

2,114

Other non-current assets

29

43

Total non-current assets

35,831

31,602

Total assets

36,821

32,727

Current liabilities

Trade and other payables

2,289

2,751

Other liabilities

25

24

Lease liabilities

415

276

Other financial liabilities

1,000

-

Provisions

213

160

Total current liabilities

3,942

3,211

Non-current liabilities

Trade and other payables

1

5

Other liabilities

847

811

Lease liabilities

10,445

8,277

Provisions

57

63

Related party borrowings

19,458

13,053

Total non-current liabilities

30,808

22,209

Total liabilities

34,750

25,420

Net assets

2,071

7,307

Equity

Contributed equity

29,500

29,500

Other reserves

9

7

Accumulated losses

(27,438)

(22,200)

Total equity

2,071

7,307

Summary of movements in accumulated losses

NBN Co & NBN Tasmania

30 June 2020

30 June 2019

For the year ended

$m

$m

Opening balance at 1 July

(22,200)

(17,321)

Loss for the period

(5,238)

(4,879)

Closing balance at 30 June

(27,438)

(22,200)