Another strong financial result has been posted for the Queenstown Lakes District Council for the 2005 2006 financial year, as it continues to be the fastest growing district in New Zealand, QLDC finance manager Stewart Burns said.

The council and its subsidiaries, the Queenstown Airport Corporation and the Queenstown Events Centre Trust, have recorded a strong financial result for the year ended 30 June 2006.

"The combined operating surplus is $34 million which is well above budget and last year?s result of $28.9 million," Mr Burns said.

The surplus was the difference between revenue and operating expenditure.

"It is not profit but represents funds tagged for debt repayment and an extensive capital works programme. Unfortunately that has been a source of some confusion over the years," he said.

The council alone recorded an operating surplus of $32.1m against a budget of $28.4 million.

Operating revenue was ahead of budget by 9.9 percent.

"This is attributable mainly to revenue derived from continuing high levels of development activity in the district. In particular, the value of infrastructure assets vested to council during the year was $6.9 million above budget as well as capital contributions from developers at $1.69 million above budget," Mr Burns said.

Operating expenditure was 8 percent above budget for the year.

"The main reasons for this relate to higher than expected inflationary factors for the period, particularly those relating to the price of oil which has had a significant impact on local maintenance contracts for roads and infrastructure," he said.

Other factors included higher than expected depreciation charge ($550,000) and engineering management costs ($450,000).

"On the positive side, most of the cash portion of this variance has been offset by higher than expected user fees, lease and sundry income which were $1.5 million above budget for the year," Mr Burns said.

The continued strong cash flows for the period had enabled external debt to be reduced by $4.1m during the year to $2.2 million.

"This is in line with expectations and ensures that council is well positioned to finance the extensive capital works programme identified in the 2006 Council Community Plan," Mr Burns said.

Unfortunately, the council was not able to complete around 40 percent (by value) of the 2005 2006 capital works programme.

This has affected the community and utilities group of activities primarily with several capital projects delayed or deferred to 2006 2007:

In June 2006 the council announced the delivery of a Procurement Strategy and sought a team of preferred consultants and designers.

"We are also actively increasing the staff resource to better enable project delivery next financial year and in the coming years," he said.

The goal was to take the delivery of capital projects from around 50 percent to 95 percent by 2010.

"The council now has a strong policy framework behind it and is rapidly strengthening its ability to deliver the work programme the community has set," Mr Burns said.

A number of major projects were delivered during 2005 2006 including:

• McDonnell Road seal extension
• Routeburn Road seal extension
• Aubrey Road seal extension
• Crown Range Road rehabilitation
• Coronet Peak Access Road rehabilitation
• Park Street carparking
• Project Pure (project defined for consent process)
• Shotover Street upgrade ($2.4 million)
• Boat ramp upgrades throughout the district.
• Queenstown Recreation Ground Management Plan
• McMurdo Park, Wanaka Plan
• Kelvin Heights Peninsula Network Plan
• Lake Hayes Walking Track
• Wanaka Cemetery upgrade
• Skyline Town Link Track
• Other achievements for the 2005 2006 have included: delivery of the first fully audited Council Community Plan; continued work on the Growth Management Strategy and the Wanaka Structure Plan; delivery of the Monitoring Strategy; the Service Delivery Review; Frankton Flats; High Density Residential Plan Changes; Affordable Housing; the Queenstown Aquatic Centre; the Transport and Carparking Strategy; Waste Management and Flood Mitigation.

The council would be asked to adopt the report tomorrow (Friday) during full council at Wanaka.

ENDS

For further information please contact Stewart Burns 03 441 0499.

By: Sarah