Enable Services Limited 2016 Annual Report Enable Services Limited 2016 Annual Report Contents Bringing Directory Celebrating 50 percent 4 uptake in Rolleston Shareholder Christchurch City Holdings Limited Christchurch families fi b r e 5 and businesses connect Registered offi ce Enable House 2nd Floor 106 Wrights Road The Enable Group Christchurch 8149 and UFB in greater New Zealand 6 Christchurch broadband Contact address PO Box 9228 Chairman and Tower Junction CEO report Christchurch 8149 8 New Zealand Web: www.enable.net.nz to greater Email: [email protected] Board of Directors Phone: 0800 434 273 26 Auditor The Auditor-General is the auditor pursuant to section 14 of the Public Audit Act 2001. Christchurch Julian Tan of Audit New Zealand was appointed to perform the audit on behalf of theGovernance Auditor-General. Solicitor 28 Simpson Grierson This vision is being realised access customers with today,Banker with more and more fibre connectivity. Financial statements families,BNZ businesses, schools Families throughout greater 30 “ and community organisations Christchurch are moving embracing fibre broadband to online entertainment Enable’s fi bre network is an essential to transform how we live options in enormous Independent our lives. Auditor’s report enabler of an economically and socially numbers and discovering 75 Children across our new ways to connect with community are taking friends and family. vibrant, innovative, connected and advantage of exciting new The potential value of online learning opportunities Enable’s fibre broadband is globally competitive Christchurch. in school and beyond. no longer a promise to be Enable CEO, Steve Fuller. The business community – realised tomorrow – it is here from Rangiora to Rolleston, now bringing benefits and and throughout the city – opening new possibilities for are discovering new ways everyone in our community. to do business and 2 / Enable Services Limited EnableEnable Services Services Limited Limited / 3 / 79 Celebrating 50 percent Christchurch families uptake with the and businesses enjoying Rolleston community their fibre experience In April 2016, Rolleston became the first town in New Zealand to pass the half way mark for fibre broadband Enable’s network Residential Business uptake – and at year end had reached 55 percent. currently reaches “ “ We invited the people of Rolleston to join Enable, 118,000 homes Communications Minister Hon Amy Adams, Selwyn District Mayor Kelvin Coe and some of the BNZ and businesses Crusaders (as part of Enable’s Take a Kid to Footy sponsorship) in celebrating how quickly the community across the greater is embracing fibre broadband. At the time, Rolleston Christchurch was two and half times the national uptake rate. Other parts of greater Christchurch have also taken to community. fibre at tremendous rates – including Wigram, Halswell At year end, almost 26,000 people and Lincoln enjoying over 40 percent uptake and Burnside, were connected to fibre broadband Northwood, Bishopdale and Redwood over 30 percent. – more than double the number We wouldn’t go back to having Companies that we deal with from a year ago. a non-fibre connection. You in Sydney and San Francisco never go back when you’ve are envious of the fibre that People across the community are got something better. we have here in Christchurch. using fibre broadband in dierent ways and have been driven to make Ged Robinson, BNZ Crusaders Ross Beck, Orly the switch for a variety of reasons. The really easy thing is that We produce eight TV ads a we can all do anything that day, each of those can be we want on the internet, around a gigabyte. Uploading at any time. those without fibre would take Cameron Ta s, Sydenham a lot of time. Aaron Pero, Mike Pero Real Estate 4 / Enable Services Limited Enable Services Limited / 5 The Enable Group and UFB in greater Christchurch The Enable Group is made up of Enable Services Limited (ESL) and local fibre company, Enable Networks Limited (ENL). ESL is a fully owned subsidiary of Christchurch City Holdings Limited (CCHL), the investment arm of the Christchurch City Council (the Council). It was launched in 2007 to build a commercial fibre network “ aimed at providing better quality broadband services to Enable becoming fully owned businesses and schools in Christchurch. by Christchurch City was able to In May 2011, ESL entered into a partnership with the Government as part of the national ultra-fast be achieved in 2016 because of broadband (UFB) initiative. The partnership is providing the tremendous success of the fibre broadband services to two UFB candidate areas – making up approximately 180,000 homes, businesses, business and the way in which schools and healthcare facilities across Christchurch the people of greater Christchurch and parts of the Waimakariri and Selwyn districts. These are embracing fibre broadband. candidate areas are Christchurch (including Rolleston, Lincoln, Prebbleton and Templeton) and Rangiora Mark Bowman, Enable Chairman. (including Kaiapoi and Woodend). Focused only on our region, Enable is inherently linked to the people of greater Christchurch and is committed On 29 June 2016, the link to the local community was to making a positive contribution to our community. further strengthened when ESL took full ownership of ENL, its critical network infrastructure and its underlying potential to transform our community. The UFB initiative investment is supported by CCHL and is funded commercially and by an interest free loan to CCHL from the Crown. This Annual Report covers the activities of the Enable Group. 6 / Enable Services Limited Enable Services Limited / 7 in agreeing that ENL would become Bringing full ownership of Enable Enable becoming a fully owned subsidiary of ESL. forward presents a number of fully owned by This new agreement took eect immediate and long-term benefits on 29 June 2016. for the business, for our shareholders Chairman and the people of and for our community. Enable It was always planned that remains a commercially funded Christchurch was Enable and its world-class fibre company with some of its debt a major milestone infrastructure would become fully funding from Central Government, owned by Christchurch City. Shifting yet our community owns 100 CEO report for our business. this plan forward was possible percent of an asset that will grow to because we are delivering on all of generate significant returns to this At the beginning of the year we set our key metrics. same community. some ambitious goals that would Enable - Christchurch’s We are deploying the network at see our business continue to grow We now have the autonomy to a rate that will ensure the build at an aggressive rate and would set determine capital structures and phase of our business will be own fibre network a platform for even greater future shareholder returns and fully drive completed by the end of 2018 - success. Just how successful we key operational decisions. We are a year ahead of the plan. We have been in achieving these goals able to run the business under a received tremendous support is highlighted by the confidence that less complex operating model and from our community, in receiving has been shown by our shareholders ensure that our strategic direction orders at volumes not expected for – CCHL and the Council – and by maximises the benefits for the two years – and connected more Crown Fibre Holdings Limited (CFH) greater Christchurch community. customers than forecast. Local connections almost 26,000 - more than doubling in a year Our marketing approach of focusing on a national level – with over half on areas of new coverage as the community now connected. Our community well as broader marketing to the A number of other suburbs where has demonstrated whole community (with two-thirds our network was well established remarkable levels now able to connect) is clearly continued to see significant uptake. delivering results. We know there is of demand for fibre considerable suppressed demand Uptake - broadband in the in areas we have just reached, with leading suburbs 31% past year. the likes of Avonhead, Ilam and Northwood Parklands passing 20 percent uptake At year end, 25,817 business, school very quickly. We have also continued 30% and home broadband users were to see exceptional demand in 29% Redwood Casebrook connected to our fibre network - suburbs where our network has been realising the benefits and potential. established for longer. Rolleston, as 29% an example, continued to be a leader 30% Northcote 35% Bishopdale We more than doubled the total Burnside connections on our network, with 13,522 net new connections – above our stretch target of 12,000. We grew the potential customer base by more than 31,000 55% 54% Rolleston Wigram homes and businesses to 117,988 and continued to proactively market the availability and benefits 43% Steve Fuller, Mark Bowman, of fibre broadband. 42% Halswell CEO Chairman Lincoln 8 / Enable Services Limited Enable Services Limited / 9 Customer experience underpins everything we do A significant market shift in the year a very clear challenge - to ensure We have also improved the feedback 17 retail service providers are now has seen retail service providers we are providing excellent customer to our retail service providers so they oering residential fibre broadband become more aggressive in service to their end user customers. can keep their end user customers Managing a significant promoting fibre broadband to their better informed. uplift in order volumes Throughout the year, Enable has services, far more than expected. customers - driving significant order and translating volumes into our business, with the continued to connect greater Importantly we delivered service The business fibre market is served highest month passing 3,000 orders. numbers of customers and invest to 92 percent of new customers on these orders into in resources and systems to more time – a considerable improvement connections, while by an even greater number of retail We have also seen a marked eectively manage our fibre on last year (87 percent) and change in the fibre products being installation experience.