Performance

TAPS Trust financial report

The ordinary units in TAPS Trust are held by HDUF Finance Trust (one of the three trusts comprising the Hastings Diversified Utilities Fund), and the financial report for the financial year ended 31 December 2007 is prepared on this basis. TAPS Trust reported a net loss attributed to ordinary securityholders (i.e. HDF) of $4.6 million. This net loss is explained by understanding the accounting treatment of the cash flows of the TAPS Trust. In particular:

-      TAPS Trust receives the majority of its cash flows from the South East Water business  (including Mid Kent Water) via a return of capital. A return of capital is reflected in the cash flow statement rather than the income statement, hence the lack of accounting earnings.

-      The distributions paid to TAPS holders are treated as an expense under Australian International Financial Reporting Standards (AIFRS), therefore increasing the net loss attributable to ordinary securityholders (i.e. HDF).

-      It is this structure that results in the majority of distributions to TAPS holders being tax deferred.

Security price and distribution history is available in the TAPS Trust Investor Centre.