3. Financial statements of each company . Incomes statement (Statement of Profit or Loss) Air Newzealand 2019 Income Statement STATEMENT OF FINANCIAL PERFORMANCE FOR THE YEAR TO 30 JUNE 2019 NOTES 2019 2018 Operating Revenue Passenger revenue Cargo 4,960 4,696 390 387 Contract services 197 193 Other revenue 238 219 5785 5,495 Operating Expenditure Labour (1,351) 1,294) Fuel (1,271) (987) Maintenance (399) (352) Aircraft operations (678) (319) (634) Passenger services (295) Sales and marketing 350) (344) Foreign exchange 53 (19) Other expenses (290) (278) 2 (4,605) (4,203) Operating Earnings (excluding items below) 1.180 1,292 Depreciation and amortisation Rental an (525) (227) Earnings Before Finance Costs, Associates and Taxation 368 Finance income 540 40 Finance costs (72) Share of earnings of associates (net of taxation) 37 (73) 33 Earnings Before Taxation 374 540 (150) Net Profit Attributable to Shareholders of Parent Company 270 390 Per Share Information: Basic earnings per share 34.7 Diluted earnings per share (cents) 24.0 34.4 Interim and final dividends declared per share (cents) 23.9 220 Net tangible assets per share (cents) 22.0 169 179 Certain balances for the year to 30 June 2018 have been restated following the adoption of NZ IFRS 15 - Revenue from Contracts with Customers. Refer to Note 25 for further details. All Revenue: All Expenses: Operating revenue 5,785 Operating expenses 4,605 Finance incomes 48 Depreciation and amortisation 567 Share of earnings of associates 37 Rental and lease expenses 245 Total revenue 5.870 Finance costs 79 Taxation expenses 104 Total expenses 5.600 Total Revenue less Total Expenses = Profit (Loss) (5,785+48+37)-(4,605+567+245+79+104) =270Telstra 2019 Income Statement Income Telstra Financial Report 2019 Statement For the year ended 30 June 2019 Telstra Group Year ended 30 June 2019 2018 Restated Note $m $m Income Revenue (excluding finance income) 2.2 25,259 25,848 Other income 2.2 2,548 2,993 27,807 28,841 Expenses Labour 5,279 5,207 Goods and services purchased 9, 138 8,338 Net impairment losses on financial assets 184 190 Other expenses 2.3 5,234 4,887 19,835 18,622 Share of net profit (loss) from joint ventures and associated entities (22) 19,823 18,644 Earnings before interest, income tax expense, depreciation and amortisation (EBITDA) 7,984 10,197 4,470 Earnings before interest and income tax expense (EBIT) 3,702 5,727 Finance income 2.2 218 Finance costs 2.3 806 Net finance costs 630 588 Profit before income tax expense 3,072 5,139 1,582 Profit for the yea 2,149 3,557 Profit/(loss) attributable to: Equity holders of Telstra Entity 2,154 3.591 Non-controlling interests (5) (34) 2,149 3,557 Earnings per share (cents per share) cents cents Basic 2.5 18.1 30.2 Diluted 2.5 18.1 30.2 The notes following the financial statements form part of the financial report. All Revenue: All expenses: Income 27,807 Expenses 19,835 Share of net profit 12 Depreciation and amortisation 4,282 Finance income 238 Finance costs 868 Total revenue 28.057 Income tax expense 923 Total expenses 25,908 Total Revenue less Total Expenses = Profit (Loss) (27,807+12+238) - (19,835+4,282+868+923) =[2,149. Balance Sheet (Statement of Financial Position) Air Newzealand 2019 Balance Sheet STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2019 NOTES 1019 2018 SM Current Assets Bank and short-term deposits 1.055 1,343 Trade and other receivables 576 nventories 81 75 Derivative financial assets 48 87 Income taxation Other assets 56 Total Current Assets 1.804 2,253 Non-Current Assets Trade and other receivables 64 Property, plant and equipment 5.268 77 Intangible assets 186 5,035 149 170 Investments in other entities Derivative financial assets Other assets 285 Total Non-Current Assets 1.952 5,593 Total Assets 7,846 Current Liabilities Trade and other payables Revenue in advance .372 322 Interest-bearing liabilities 307 431 Derivative financial liabilities Provisions 117 Income taxation Other liabilities 263 Total Current Liabilities 2,666 2,696 Non-Current Liabilities Revenue in advance 200 Interest-bearing liabilities .290 185 2,303 Provisions 165 151 Other liabilities 42 27 Deferred taxation 304 308 Total Non-Current Liabilities 3,001 2,974 Total Liabilities 5.667 5.670 Net Assets 2,089 2,176 Equity Share capital 2,219 2,226 Reserves (130) (50) Total Equity 2,089 2,176 Assets = Liabilities + Equity 7,756 = 5,667 + 2,089 Assets: 7,756 Liabilities: 5,667 Equity: 2,089Telstra 2019 Sheet Balance Statement of Telstra Financial Report 2019 Financial Position As at 30 June 2019 Telstra Group As at 30 June 30 June 1 July 2019 2018 2017 Restated Restated Note $m $m $m Current assets Cash and cash equivalents 2.6 604 629 938 Trade and other receivables and contract assets 3.3 5,39 5,588 6.09 Deferred contract costs 3.8 95 69 106 Inventories 448 492 469 Derivative financial assets 43 179 75 21 Current tax receivables 7 6 11 Prepayments 457 431 412 Assets classified as held for sale 3.1 121 Total current assets 7,303 7,290 3.047 Non-current assets Trade and other receivables and contract assets 3.3 780 730 971 Deferred contract costs 3.8 1.232 1,180 997 Inventories 3.4 35 19 29 Investments - accounted for using the equity method 6.2 1,298 237 194 Investments - other 44 25 36 292 Property, plant and equipment 3.1 22,332 22,108 21,350 Intangible assets 3.2 7,21 7.922 8,317 Derivative financial assets 4.3 2.083 1.897 1.623 Deferred tax assets 2.4 59 54 44 Defined benefit asset 5.3 232 250 142 Total non-current assets 35,286 35,433 $3,959 Total assets 42,589 42,723 42,006 Current liabilities Trade and other payables 3.5 4,528 4.528 3,944 Employee benefits 5.1 804 368 865 Other provisions 103 89 16 Borrowings 4.3 2,22 1,635 2,476 Derivative financial liabilities 4.3 57 42 Current tax payables 2.4 103 132 161 Contract liabilities and other revenue received in advance 3.6 1.657 532 1,424 Liabilities classified as held for sale 31 79 Total current liabilities 9,553 8,785 9,081 Non-current liabilities Other payables 3.5 68 70 Employee benefits 5.1 158 57 60 Other provisions 158 168 134 Borrowings 4.3 15,031 15,316 14.808 Derivative financial liabilities 43 283 389 536 Deferred tax liabilities 24 1,529 1.537 1,443 Defined benefit liability 5.3 8 Contract liabilities and other revenue received in advance 3.6 1,271 1,681 1,617 Total non-current liabilities 18,506 19,319 18,774 Total liabilities 28,059 28,104 27,855 Net assets 14,530 14,619 14,151Statement of Financial Position (continued) As at 30 June 2019 Telstra Group As at 30 June 30 June 1 July 2019 2018 2017 Restated Restated Note $m $m $m Equity Share capital 4.2 4,447 4,428 4,421 Reserves 42 (58) (131) (105) Retained profits 10.160 10,335 9.816 Equity available to Telstra Entity shareholders 14,549 14,632 14,132 Non-controlling interests (19 (13) Total equity 4,530 14,619 14,151 The notes following the financial statements form part of the financial report. Assets = Liabilities + Equity 42,589 = 28,059 + 14,530 Assets: 42,589 Liabilities: 28,059 Equity: 14,530. Statement of Changes in Equity Air Newzealand 2019 Statement of Changes in Equity STATEMENT OF CHANGES IN EQUITY FOR THE YEAR TO 30 JUNE 2019 FOREIGN SHARE HEDGE RESERVES GENERAL NOTES CAPITAL TRANSLATION RESERVE TOTAL SM QUITY Balance as at 1 July 2018 2,226 66 (13 (103) 2,176 Net profit for the year 270 270 Other comprehensive income for the year (97) (6 (102) Total Comprehensive Income for the Year (97) 264 168 Transactions with Owners: Equity-settled share-based payments (net of taxation) 3, 17 7 7 Equity settlements of long-term incentive obligations 17 (14) Dividends on Ordinary Shares 16 (14) (248) 248) Total Transactions with Owners (248) (255) Balance as at 30 June 2019 2.219 130) (12) (87) 2.089 FOREIGN SHARE CURRENCY PITA RESERVES ANSLATION ESERVES TOTAL NOTES Balance as at 1 July 2017 2,238 (16 (245 1,986 Net profit for the year 390 390 Other comprehensive income for the year 57 60 Total Comprehensive Income for the Year 57 390 450 Transactions with Owners: Equity-settled share-based payments (net of taxation) 3, 17 Equity settlements of long-term incentive obligations 5 5 16 (17) Dividends on Ordinary Shares 248) 248) Total Transactions with Owners (12) (248) (260) Balance as at 30 June 2018 2,226 66 (13 (103) 2,176Telstra 2019 Statement of Changes in Equity Statement of Changes in Equity For the year ended 30 June 2019 Telstra Group Share Reserves Retained Total Non- Total capital profits control- equity ling interests Note $m $m $m $m $m $m Balance as previously reported at 1 July 2017 4,421 105) 10,225 4,541 19 14,560 Change in accounting policy arising from AASB 15: 'Revenue from contracts with customers' 1.5 (409 (409) (409) Restated balance at 1 July 201 4,421 105) 9,81 14,132 19 14,15 Restated profit/(loss) for the year 3.591 3,59 34) 3,557 Restated other comprehensive income (23) 78 55 (3) 52 Restated total comprehensive income for the year (23) 3,669 3,646 37) 3,609 Dividend 3,150) (3,150) (2) 3,152) Non-controlling interests on disposals (1) Transactions with non-controlling interests (3 (3) 3 Amounts repaid on share loans provided to employees Additional shares purchased 18) (18) 18 Share-based payments 24 24 5 29 Restated balance at 30 June 2018 4.428 (131) 10.335 14,632 (13) 14.619 Change in accounting policy arising from AASB 9: 'Financial instruments' 1.5 63) (63) Restated balance at 1 July 2018 4.428 (131) 10,272 14,569 13) 14,556 2,154 2,154 2,149 Other comprehensive income 73 66 Total comprehensive income for the year 73 2,14 2,220 (5) 2,215 Dividend (2,258) (2,259) (2) (2,261) Non-controlling interests on disposals Transactions with non-controlling interests (11 Amounts repaid on share loans provided to employees Share-based payments 18 18 19 Balance at 30 June 2019 4,447 (58) 10,160 14,549 (19) 14,530 The notes following the financial statements form part of the financial report.. Statement of Cash Flows Air Newzealand 2019 Statement of Cash Flows STATEMENT OF CASH FLOWS FOR THE YEAR TO 30 JUNE 2019 NOTES 2018 2018 Cash Flows from Operating Activities Receipts from customers 5,869 5,444 Payments to suppliers and employees 4,835 (4.307) Income tax paid (23) (81) Interest paid (71) 63) Interest received 46 38 Net Cash Flow from Operating Activities 986 1,031 Cash Flows from Investing Activities Disposal of property, plant and equipment, intangibles and assets held for resale 13 33 Distribution from associates 24 16 Acquisition of property, plant and equipment and intangibles (821) (809) Interest-bearing asset payments (82) (18) Net Cash Flow from Investin g Activities (883) (778) Cash Flows from Financing Activities Interest-bearing liabilities drawdowns 263 58 347 Rollover of foreign exchange contracts (20) Equity settlements of long-term incentive obligations 17 ( 14 ) (17) Interest-bearing liabilities payments Dividends on Ordinary Shares 16 (438) (329) (260) (260) Net Cash Flow from Financing Activities (391) (279) Decrease In Cash and Cash Equivalents (288) (26) Cash and cash equivalents at the beginning of the year 1.343 1,369 Cash and Cash Equivale 1,055 1.343 "Relates to gains/losses on rollover of foreign exchange contracts that hedge exposures in other financial periods. Certain balances for the year to 30 June 2018 have been restated following the adoption of NZ IFRS 15 - Revenue from Contracts with Customers. Refer to Note 25 for further details. Net cash flow from operating + Net cash flow from investing + Net cash flow from financing = Decrease in cash and cash equivalents = cash and cash equivalents at end of the year - cash and cash equivalents at the beginning of the year 986 + (-833) + (-391) =-288 1,055 - 1,343 = -288 Net cash flow from operating: 986 Net cash flow from investing: -833 Net cash flow from financing: -391 Cash and cash equivalents at beginning of the year: 1,055 Cash and cash equivalents at the end of the year: 1,343 Decrease in cash and cash equivalents: -288Telstra 2019 Statement of Cash Flows Statement of Telstra Financial Report 2019 Cash Flows For the year ended 30 June 2019 Telstra Group Year ended 30 June 2019 2018 Note $m $m Cash flows from operating activities Receipts from customers (inclusive of goods and services tax (GST)) 30,231 31,901 Payments to suppliers and employees (inclusive of GST) (22,748) (21,948) Government grants received 156 174 Net cash generated by operations 7,639 10,127 Income taxes paid 2.4 (956) (1,521) Net cash provided by operating activities 2.6 6,683 8,606 Cash flows from investing activities Payments for property, plant and equipment (3,235) (3,571) Payments for intangible assets (1.135) (1,361 Capital expenditure (before investments) (4,370) (4,932) Payments for business and shares in controlled entities (net of cash acquired) (115) (56) Payments for equity accounted investments (21) (15) Payments for other investments (26) (67) Total capital expenditure (including investments) (4,532) (5,070) Government grants received 53 Proceeds from sale of property, plant and equipment 646 796 Proceeds from sale of business and shares in controlled entities (net of cash disposed) 42 49 Proceeds from sale of other investments 6 24 Distributions received from equity accounted investments 33 9 Interest received 33 65 Proceeds from finance lease principal amounts 104 125 sed in investing activities (3,615) (3,911) Operating cash flows less investing cash flows 3,068 4,695 Cash flows from financing activities Proceeds from borrowings 4.669 4.195 Repayment of borrowings (4,637) (5,148) Repayment of finance lease principal amounts (79) (120) Purchase of shares for employee share plans (18) Finance casts paid (781) (776) Dividend paid to equity holders of Telstra Entity 4.1 (2.259) (3,150) Other (1) Net cash used in financing activities (3,088) (5,015) Net decrease in cash and cash equivalents (20) (320) Cash and cash equivalents at the beginning of the year 620 936 Effects of exchange rate changes on cash and cash equivalents 4 Cash and cash equivalents att e end of the year 604 620 The notes following the financial statements form part of the financial report. Net cash flow from operating + Net cash flow from investing + Net cash flow from financing = Decrease in cash and cash equivalents = cash and cash equivalents at end of the year - cash and cash equivalents at the beginning of the year 6,683 + (-3,615) + (-3,088) =-20 600 - 620 = -20Net cash flow from operating: 6,683 Net cash flow from investing: -3,615 Net cash flow from financing: -3,088 Cash and cash equivalents at beginning of the year: 620 Cash and cash equivalents at the end of the year: 600 Decrease in cash and cash equivalents: -20