Content Page Reference

1. Shareholder Agreement 3

2. Corporate Objectives 4

3. Business Overview 5-7

4. Major Urban Renewal Portfol io 8

5. Financial Performance Targets 9

6. Non - Financial Performance Targets 10

7. Reporting Obligations 11

8. Policy Compliance 12-13

UrbanGrowth NSW Statement of Corporate Intent 2014 15 2

Statement of Corporate Intent

ORGANISATION: UrbanGrowth NSW

PERIOD: Commencing 1 July 2014

This Statement of Corporate Intent has been agreed between:

on behalf of the Board

UrbanGrowth NSW Statement of Corporate lntent2014 15 3

First Voting Shareholder

The Hon. Andrew Constance MP Treasurer

~ cond Voting Shareholder

The Hon. Dominic Perrottet MP Minister for Finance and Services

Statutory Objectives (summarised)

Our Principal Objectives under the Landcom Corporation Act 2001 are:

(a) to be a successful business and:

(i) to operate at least as efficiently as comparable businesses, and

(ii) to maximise the net worth of the State's investment in it

(b) to exhibit a sense of social responsibility

(c) to protect the environment by conducting its operations in compliance with the principles of ecologically sustainable development

(d) to exhibit a sense of responsibility towards regional development

(e) to undertake, or assist the Government in undertaking, strategic or complex urban development projects

(e) to assist the Government in achieving its urban management objectives

(f) to be a responsible developer of land.

The first four objectives are generic to all State Owned Corporations and the final three are specific to our organisation.

UrbanGrowth NSW Statement of Corporate lntcnt2014·15 4

We have been charged with responsibility to deliver major urban renewal projects in NSW. Our business is transitioningand is now focused on coordinating agencies across the NSW Government to deliver on urban renewal objectives including:

,.. Driving increases in supply of housing and jobs

,.. Strengthening the NSW economy by delivering world class centres that attract investment and boost productivity

,.. Optimising public investment in infrastructure through integrating land use and transport planning

,.. Operating on a commercially astute basis, seeking a fair return for taxpayers

,.. Promoting public sector innovation through collaborating across government, the private sector and the community in the delivery of Major Urban Renewal Projects

UrbanGrowth NSW Statement of Corporate lntent2014·15 5

11000

10000

9000

8000

7000

6000

5000

4000

3000

2000

1000

0

10,000 Home site program

Home sites released

Program to December 2013

Januar 2014 Total

Baseline Target

5,508

197 5705

5,827

36 5863

319 .

-131 158

5 ,863 6,270

5,705

5, 508

7, 611

6 ,806

Target sales releases at 1 July 2011

.._Actual sa les re leases

10,004

9 ,297

8,307

Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 Oec-12 Mar-13 Jun-13 Sep-13 Oec-13 Mar-14 Jun-14 Sep-14 Oec-14 Mar-lS Jun-15

UrbanGrowth NSW Statement of Corporate Intent 2014-15 6

900 800 700

"' 600 c: .2 500 --·e 4oo 11'). 300

200 100

0

Key Financial Indicators

2011 2012 2013 2014 2015 2016 2017 2018

• NPAT • Dividends+ Tax • Revenue

Years 2011 - 2013 are actuals

UrbanGrowth NSW Statement or Corporate Intent 2014 15 7

The Major Urban Renewal Portfolio has the ability to substantially transform Sydney. Our projects are illustrated below.

~~~JnGrowth Major Urban Renewal Portfolio

,.. ______ ... ...,. ___ .... ...,_ ,.._, .. - ...... --~-

UrbanGrowth NSW Statement of Corporate Intent 2014 15 8

Urban Growth NSW uses a number of targets to assess financial performance. In addition to the organisation targets listed below, each development project undergoes a rigorous business case or feasibility assessment prior to approval. The figures in the table below reflect the change in the organisation's business model as it transitions to a Major Urban Renewal Portfolio from greenfield retail developments.

Table 1: Annual Financial Performance Targets

Revenue {$M)

Return on Equity

Urban Growth NSW Statement of Corporate Intent 2014·15 9

2013-14 Forecast

$

629.0

144.6

143.5

137.5

96.2

70%

17.60%

24.39%

2014-15 SCI

$

778.9 -

121.0 -

119.9

112.5 -·-·

78.7

70%

15.18% -

18.71%

2015-16 Forecast

$

744.5

69.3 --

68.2

60.8 . ·-

42.6 . _ _..,_,

0%

8.88% -

9.38%

2016-17 Forecast

$

465.7

39.0 -·--

37.9

34.0 -

23.8 --- -

0% --

5.13%

4.89%

The Corporation's non-financial performance targets include our existing 10,000 Home site program and actions to mobilise private sector housing development as measured by dwelling supply and stakeholder feedback (new business).

Table 2: Non-Financial Performance Targets

Key Objectives Non Financial Performance Targets

• Progress against 10,000 Home Sites Program­We will continue to measure our performance against the Government's 10,000 Home Sites Program unti l end of FY15.

• Industry assessment - We will be qualitatively scored for service delivery via feedback collected (independently) for three key stakeholder groups:

1. Industry associations 2. State government agencies 3. Local agencies

UrbanGrowth NSW Statement of Corporate lntent2014-15 10

2014-15

Measured against 1 July 2011 agreed target sales releases.

2014-15

N/A

2015-16

N/A

Independent surveys will be conducted every 2 years with all three key stakeholder groups, and the results tracked year­to-year.

During the course of the 2014-15, Voting Shareholders will be provided with annual and half yearly reports in addition to continuous monthly updates of financial information to Treasury.

Schedule 1: Reporting Schedule for Voting Shareholders

Statuto re ortin re uirements

Jul Aug Sept Oct Nov Dec Jan Feb Mar April May

Half year financial report - · --- --Annual report -

Jun

In addition, the following additional reports will be compiled throughoutthe year to help describe UrbanGrowth NSW's overall and comparative performance:

Schedule i: Additional Progress Reports - Available on Request

Additional performance reportin

Progress against 10K Home sites

Performance reports*

------------Jul Aug Sept Oct Nov Dec Jan Feb Mar April May Jun - - --- - - -* Reports compiled by NSW Treasury, with assist ance f rom UrbanGrowth NSW

Urt>anGrowth NSW Statement of Corporate lntent2014 15 11

UrbanGrowth NSW confirms:

(a) The financial forecasts included in this Statement of Corporate Intent have been prepared in accordance with the State Owned Corporation Act 1989 and Australian Accounting Standards and the requirements of the Public Finance and Audit Act 1983 and Public Finance and Audit Regulation 2010

(b) The performance targets within the SCI are based on and supported by the Organisation's Business Plan.

(c) It will provide the voting shareholders with financial and other information, including information on major capital expenditure, on a quarterly basis to assess the performance against commitments in this SCI and to assess the value of the shareholders' investment in the business

(d) Its asset maintenance policies and processes are adequate and appropriate to manage and control risks associated with physical assets

(e) Al l known 'key risks' and 'major emerging contingent liabilities' which could material ly impact the current and future results of the Corporation have been disclosed to our Shareholders

(f) Related party interests, which may represent a possible conflict of interest for Directors have been disclosed, in accordance with Treasury Management Policy.

UrbanGrowth NSW Statement of Corporate Intent 2014·15 12

•

•

•

More particularly, the Corporation is aware of the following policies and/or guidelines and will comply with these to the extent they apply to UrbanGrowth NSW:

Commercial Policy Framework policies, as listed in State Owned Corporations: Applicable TPPs under the Commercial Policy Framework 2013

NSW Treasury Circulars on accounting policy matters as listed in the attachment 'State Owned Corporations Mandatory Accounting Policies 2013'

Internal Audit and Risk Management Policy in NSW Public Sector

•

•

•

•

Ministeria l Memorandum No 2012-04, Application of NSW public Sector Wages Policy 2011 to State Owned Corporations

Ministerial Memorandum No 2012-08 Use of Biofuels

Ministerial Memorandum No 2010-07, Working Together: Public Sector Workplace Health and Safety and Injury Management Strategy 2010-2012

Ministerial Memorandum No 2010-03, Strengthening Aboriginal Employment Opportunities and Community Partnerships

• Ministerial Memorandum No. 2013-08, Official Travel within Australia and Overseas.

• Ministerial Memorandum No 2013-04. Implementation guidelines for procurement of pub licly funded construction services.

UrbanGrowth NSW Statement of Corporate Intent 2014 15

13

UrbanGrowth NSW

Chair and CEO's Declaration of Dividend Approach

2014-15 Statement of Corporate Intent

We certify that the 2014-15 Statement of Corporate Intent ad

is consistent with the business' ability to meet its ob

'2 -'1-l 0 l ~