The FPC continues to provide a significant contribution to the economies of the State and many communities throughout the south-west of Western Australia.
This financial year, an operating profit result of $0.03 million has been achieved after taking into account an additional amortisation expense of $2.2 million.
This result is contributed to by all forest business segments returning a profit before amortisation of licences and right of use assets.
The profit earned by the FPC has enabled the investment of $11.6 million in building the State’s softwood estate, native forest and sandalwood resource regeneration programs.
During 2018–2019, a dividend of $1.04 million was paid to the State Government for the 2017–2018 year.
Pricing arrangements are determined by a variety of factors including requirements under the Forest Products Act 2000.
Section 59 of the Act prescribes the costs that are to be factored into a price for forest products. Contracts include indexation or an alternative escalation mechanism to minimise financial risk to the FPC.
The following table details a summary of our corporate performance against the financial outcomes and targets detailed in the Statement of Corporate Intent.
|Target 2018-19 ($ millions)||Actual 2018-19 ($ millions)||Variance ($ millions)|
|Total expenses (sourced from Statement of Comprehensive Income)||130.7||126.3||4.4|
|Total income (sourced from Statement of Comprehensive Income)||135.9||126.3||(9.6)|
|Total equity (sourced from Statement of Financial Position)||365.2||264.6||(100.6)|
|Net increase / (decrease) in cash held (sourced from Statement of Cash Flows)||(7.1)||0.9||8.0|
|Net profit / (loss) after tax||(9.4)||1.4||10.8|
|Closing cash balance||23.5||31.4||7.9|
|Target 2018-19 (%)||Actual 2018-19 (%)||Variance (%)|
|Return on assets||1.4%||0.0%||-1.4%|
|Return on equity||1.4%||0.0%||-1.4%|
|Operating profit to timber revenues||3.9%||0.0%||-3.9%|
*Due to a change in Accounting Policy, the FPC achieved an operating profit result of $0.03 million after taking into account an additional amortisation expense of $2.2 million as per note 5.2.1.