ANNUAL REPORT FINANCIAL YEAR 2010 TVNZ/TVNZ_AR_FY10.pdfTVNZ ANNUAL REPORT FY2010 4 The impact of the recession on media industry revenues globally has been widely publicised, with

ANNUAL REPORT FINANCIAL YEAR 2010

Management and staff have produced a creditable result in the midst of the media industry’s worst ever international downturn, through a combination of disciplined cost management and determined effort to maintain market share.

Rick Ellis - Chief Executive Officer

“

INSPIRING NEW ZEALANDERS ON EVERY SCREENTe Whakaaratanga o Aotearoa ki ngā Rīangi Whakaata Katoa

4 Chairman’s Introduction

5 Chief Executive’s Overview

8 Financial Performance

9 TVNZ in Society

11 General Charter Measures

12 Charter Performance Measurements

30 Financial Statements

80 Corporate Governance

81 Directors’ Profiles

82 Main Locations

TABLE OF CONTENTS

TVNZ ANNUAL REPORT FY2010

4

The impact of the recession on media industry revenues globally has been widely publicised, with New Zealand similarly impacted.

By the end of the 2009 calendar year TVNZ revenues were at pre-2000 levels and by March 2010 the company had experienced nearly six consecutive quarters of year-on-year declines. The April–June quarter, however, saw year-on-year revenue growth again.

The company moved quickly and effectively during the financial year to reduce costs in response to the recession, whilst at the same time progressing key strategic capital investment projects and implementing a new sales go-to-market approach.

Pleasingly the company exceeded its EBIT budget, delivering an EBIT of $12.9 million. This was an improvement of $2.8 million over the prior year and occurred even though there was a $29.3 million year-on-year decline in revenues.

The Board has declared a dividend to the shareholder of $4.9 million, in comparison with last year’s dividend of $1.5 million.

Despite this improvement in operating earnings, TVNZ is reporting a net bottom-line loss of $26.0 million as a result of the impact of two one-off non-cash accounting adjustments. These are a change in programme stock utilisation policy and the change to the way depreciation of buildings is to be treated for tax purposes.

TVNZ strives to be New Zealand’s leading television and digital media company. Consistent with our strategy of “Inspiring New Zealanders on every screen” the year saw us launch our first digital pay TV channel, TVNZ Heartland, on the SKY TV platform, extend our highly acclaimed TVNZ ondemand service to the Sony PlayStation 3 and launch a successful iPhone news application.

The Board believes that TVNZ is well positioned to capitalise on improving economic and market conditions. I wish to acknowledge the outstanding efforts and results from management and staff during what have been the most difficult trading conditions in the company’s history.

I pā mai ki Aotearoa te aria o te whakahekenga o te hua moni ki nga ūmanga pāho kua panui whanuitia i te ao. E rite ana tēnei te āhua ki konei.

I te tōnga o te tau 2009 i te rite ngā moni hua i riro mai i ā Te Reo Tātaki ki era i mua ake i te tau 2000, ā, tae rawa mai ki te marama o Māehe ō 2010 i pā mai ki te kamupene, tata āna ki te ono ngā tau rārangi e whakaheke ana ngā hua. I waimarie, na te mea, mai i te wa o Aperira ki Hune kātahi anō ka timata te ora mai anō o tēnei tau kāore i pērā i te tau ō muri.

He tere te neketanga o Te Reo Tātaki i te wā o te tau-ā-tahua ki te whakangāwari i ngā taumahatanga hei kāro i nga mamae o te whakahekenga. I taua wa anō, i whakamātauria nga take whai hua, me te whakamātau he pārure hou hei tauira.

Ko te kōanga ngākau, ara noa ātu te ekenga o te pārure ki $12.9 miriona. E $2.8 miriona te pikinga atu mai i te tau ō muri ā, i eketia tenei, ahakoa te tino hekenga mai i te tau o mua. E $29.3 miriona te tatauranga whakaotinga.

E pānui ana te Poari he hua, $4.9 miriona, ki te kahui whai pānga. Kei runga āke tenei i te $1.5 miriona o tērā tau.

Ahakoa te rewatanga āke ō ngā hua, ko te karere a Te Reo Tātaki, e $26.0 miriona te whakahekenga whakaotinga. Na te mea ē rua ngā whakamōmōritanga o nga tikanga kaute i whāia ai tēnei huarahi. I pēnei ai, na te mea i whakarerekētia te whakaputanga o nga rārangi hōtaka, me te hekenga-a-wāriu o ngā whare mo ngā kaupapa e pā ana ki ngā āhuatanga tāke.

Kei te kaha rawa ātu a Te Reo Tātaki ki te āki i a ia āke hei tauira mo ngā āhuatanga katoa o te ao whakapāoho, ahakoa ko te ao māmati me te mau tonu ki te tātaku, “Te Whakaaratanga o Aotearoa ki ngā Rīangi Whakaata Katoa”. I timata i tenei tau te tuatahi o nga teihana utu a TVNZ Te Iho Whenua i runga i nga teihana o SKY, me te whakawhānuitanga o Te Reo Tātaki-ā-tono, Teihana Purei 3 ā Sony me te hopu a nga aeWaea i nga pitopito kōrero o te wā.

E whakapono ana te poari kei te pai te tū a Te Reo Tātaki ki te whakaora anō i ngā tikanga o ana rawa ki waenganui i nga ūmanga pāho. Me tino mihi rawa ātu ahau ki te kaha o nga kaiwhakahaere me te hunga mahi mo to ratou pūmau ki te kaupapa i tēnei te wa, te tau tino tūpuhi, mai i ngā tau i tīmata ai a Te Reo Tātaki.

Sir John Anderson - Chairman

CHAIRMAN’S INTRODUCTION Te Ripoata a te Manukura


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TVNZ HAS EMERGED FROM THE RECESSION IN BETTER SHAPE THAN SEEMED ACHIEVABLE AT THE MID-POINT OF THE FINANCIAL YEAR.Management and staff have produced a creditable result in the midst of the media industry’s worst ever international downturn, through a combination of disciplined cost management and determined effort to maintain market share.

Crucially, the immediate demands of surviving a recession have not been allowed to divert the company’s attention from its long term goals. The capital investment, innovation, business partnerships and transformational projects that underpin our strategy of ‘Inspiring New Zealanders on every screen’ have pushed ahead - despite the constraints - with excellent results this year and equally good prospects in the future.

Our progress against the business priorities we set in our Statement of Intent is detailed below:

1 Accelerate the change to the business foreshadowed in the five year strategic plan

The plan is to change TVNZ from a traditional analogue advertising-reliant broadcaster to a multi-platform television and digital media company with diversified revenue streams. Initially this progression was expected to take 5 to 10 years, but the global economic downturn has necessitated an accelerated response over the next one to three years.

To this end, we completed the integration of the disparate sections of our sales force this year so that it now operates as one across both TV and digital media.

We addressed the issue of sales commissions and have set a date for the introduction of a new rate that allows our clients to see the true cost of advertising.

In June we successfully launched our first pay TV channel, TVNZ Heartland, on the SKY TV platform, where within its first few weeks more than 21% of the population had tuned in.

The installation of high-end digital equipment that will provide a future-proofed digital infrastructure was running to time, ready for operation in the final quarter of the calendar year.

And many months of painstaking analysis came together with the launch of a new operational design for our News and Current Affairs division, which brings us into line with the world’s top broadcasters and creates an efficient news supply-line for all our news and current affairs programmes, media outlets and platforms.

2Achieve advertising revenue share growth

The effort put into completion and introduction of a new Sales go-to-market strategy has had a positive impact. While television advertising has declined, it has done so less dramatically than other traditional media and in fact showed a welcome resurgence in the last quarter of the fiscal year. TVNZ’s share of the television market also rose in the last quarter.

Over the full year, our television advertising revenue held firm at 60.6%.

3Maximise TVNZ’s share of contestable funding

The last financial year has been especially challenging for us in the area of local content production. Agreement was reached with NZ On Air (NZOA) for reduced licence fees in response to the recession.

During the year a number of significant new shows were funded by NZOA for broadcast on TVNZ channels in FY2010.

Country Calendar achieved the milestone of 45 years on air. Key documentary series were renewed such as Beyond the Darklands and The Investigator, with the first episode “The Case Against Robin Bain” going to air to huge critical acclaim and significant ratings.

In the documentary genre a new historical docudrama series received significant support. TV ONE also continued to lead the field with Sunday dramas. New titles included Tangiwai, Bliss, Bloodlines and Nights in the Garden of Spain.

Our leadership in factual entertainment and observational documentary was supported by NZOA with series such as North with Marcus Lush, Radar’s Patch, Coasters and a further series of How the Other Half Lives.

The standout success in achieving NZOA support for TV2 has been the renewal of Go Girls.

CHIEF EXECUTIVE’S OVERVIEW


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CHIEF EXECUTIVE’S OVERVIEW (CONTINUED)

NZOA has continued support for the long running children’s programme What Now on weekends as well as the weekday programme, The Erin Simpson show and Studio 2. TV2 also received NZOA support for a new children’s drama in co-production with the BBC called Paradise Café.

We continue to strive to provide the best range of quality local programming that will deliver the audiences TVNZ and NZOA aspire to.

4Sustain the performance of TV ONE and TV2

The combined audience delivery of TV ONE and TV2 against 18-54 year olds in the 2010 year was very pleasing with TVNZ achieving budget and growth over last year.

The major driver of this result was an outstanding ratings and share performance on TV2 where the channel achieved its highest channel share for the last five years. TV2 exceeded its monthly performance targets in all 12 months and as well as winning its target demographics of 18-39 year olds and “household shoppers with kids”. It also won overall in 25-54 and 18-49.

A number of the key properties which drove performance on TV ONE and TV2 (including Shortland Street, MasterChef, FIFA World Cup and Go Girls) also had a strong online presence which helped build audience engagement as well as maximising programme reach.

5Develop an integrated strategy for all TVNZ channels

TVNZ now delivers content across multiple platforms – TV ONE, TV2, TVNZ 6, TVNZ 7, TVNZ Heartland, TVNZ Ondemand and tvnz.co.nz. How the increasing portfolio of channels, platforms and devices interact with each other, and their brand positions in the marketplace, are critical to TVNZ’s value as New Zealand’s national television and digital media company.

During the year the company changed the organisation and structure of executive responsibilities to reflect a strong brand and performance focus on each of our channels, whether TV or digital media. Content acquisition, commissioning and production – including News and Current Affairs, Maori and Sport – have been repositioned to serve the needs of all channels, not just a specific channel as the company has always done.

The reconfiguration of the News and Current Affairs division, finalised at the close of the financial year after many months of planning, was an important step in recognising the status of TVNZ as the market leader in the multi-platform, multi-channel environment.

6Implement a TVNZ multi–year brand strategy

TVNZ, in conjunction with its marketing partners, began implementing a multi-year brand strategy which will see the company’s many distribution points remain relevant to viewers and advertisers.

This thinking informed the branding of TVNZ’s new pay channel on SKY TV – TVNZ Heartland. In a fragmented media market and with TVNZ delivering content across multiple platforms it becomes essential for us to demonstrate a clear branding position to maximise value.

7Drive digital media business growth

There has been phenomenal growth in digital media during the year. Revenue grew 56% across the year. In the last quarter of FY2010, TVNZ digital media revenue grew 38% on the same period last year, almost double the market display growth of 19%. Unique Browsers to tvnz.co.nz grew 13.5% and TVNZ Ondemand’s unique visitors grew 74% as it continues to be embraced by broadband users. Consequently TVNZ Ondemand’s revenues grew 248% and we extended its availability to the Sony Playstation 3.

8Complete digital playout facility implementation

This project has been supported by one of the company’s largest capital allocations – in recognition of its importance in effecting TVNZ’s transition to the country’s leading television and digital media company. This playout facility will enable TVNZ to move away from its outdated tape-based analogue processes and into a far more efficient, cost-effective and future-proofed way of ingest and playout of content. The facility is on target for launch in the 4th calendar quarter of 2010, and essentially completes TVNZ’s infrastructure transformation. In addition to implementation of the latest digital television and digital media technology there are substantial associated changes to the way we work. A number of new job functions have been created and significant training is being undertaken.

9Plan for digital switch over (DSO) and spectrum reallocation

TVNZ has taken a lead in a collaboration with the Ministry for Culture and Heritage, Ministry of Economic Development and industry to plan for digital switch over. The company has participated fully in the advisory groups that will assist the Government to manage a smooth transition from analogue transmission of television signals into a totally digital environment. Freeview – the digital Free-To-Air platform established to encourage New Zealanders to ‘go digital’- is continuing to grow ahead of projections. As at June 30 2010 Freeview was reaching viewers in more than a quarter of New Zealand homes, tracking closer to the trigger point at which the Government will decide a date for DSO.


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The performance of the company, in the context of an economic king-hit to the media industry, has been heartening.

Despite the challenging year, our market share remained steady, all 20 of the top 20 most watched programmes were on TVNZ, we launched our first digital pay TV channel on the SKY platform, and we extended the popular TVNZ Ondemand service to the Sony Playstation 3.

These and many other highlights of the year would not have been achievable without the single-minded efforts of our TVNZ people, who have my thanks and admiration.

While I am cautiously optimistic about the coming year, the economic recovery is patchy and structural changes in the industry will still challenge all media companies. We have come through the recession well and adapted to the digital era better than most, but we will still need to keep a sharp eye on costs while we press ahead with our strategy of transformation and diversification.

Rick Ellis – Chief Executive Officer

FINANCIAL PERFORMANCE


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TVNZ has reported total revenue of $355.3 million and underlying earnings of $12.9 million for the year.

Total revenue was $29.4 million (7.6%) down on the prior year, which includes a reduction in television advertising of $14.1 million (4.7%). The decline in revenue reflects the challenging year faced by all advertising-reliant media companies in the economic downturn resulting from the global financial crisis.

TVNZ maintained its share of all television advertising revenue at 60.6%, notwithstanding that in the prior year TVNZ had enjoyed a share lift in the first quarter due to the Beijing Olympics. TVNZ’s advertising revenue share performance in the last two quarters was particularly pleasing with quarter-on-quarter and year-on-year increases.

The decline in other revenues included a reduction in Government programme funding revenues of $9.8 million and trading revenues associated with transmission services to international broadcasters in association with the Beijing Olympics. The lower level of Government programme funding reflects the withdrawal of Direct Funding and the establishment of the NZ On Air contestable Platinum Fund, with effect from July 1st 2009.

Programme funding is recognised as income as the programme cost is recognised as an expense, so the reduced level of funding revenue also reflects the lower level of funded programmes being broadcast.

In response to the reduction in revenues, the company undertook a disciplined approach to managing and reducing costs. Total operating costs were $342.4 million, a reduction of $32.3 million (8.6%) on the prior year. The savings in programme costs were $25.9 million, while all other operating costs were reduced by $8.0 million, offset by a $1.6 million increase in depreciation and amortisation.

While the company continues to restructure to reduce operating costs, it has also continued to invest in the transformation of TVNZ. The company is in year two of a three year digital infrastructure investment programme, all of which has been funded from operating cashflow.

Underlying earnings were $12.9 million, a $2.8 million (28%) increase on the prior year. The increase in earnings is a direct result of the company’s disciplined approach to managing costs out of the business in the face of declining revenues.

TVNZ has reported an after tax loss of $26.0 million as a result of two non-recurring accounting adjustments. TVNZ has changed the expensing of programme costs to accelerate the period over which cost is recognised. The amortisation period for locally produced programming has been changed from amortisation over 12 months to fully amortise on first screening. The amortisation for movies has been reduced from 36 months to 12 months. Full details of the changes to the expensing of programme costs is shown in note 6, which has resulted in the non-recurring accounting adjustment of $26.8 million.

On May 20th 2010 the Government announced changes to the corporate tax rate and the removal of tax depreciation allowances on buildings. This has resulted in an additional charge to tax expense and a corresponding increase in deferred tax liability. Note 9 details the impact of the tax legislation changes which resulted in the non-recurring accounting adjustment of $14.2 million.

Excluding these two non-recurring accounting adjustments, the normalised after tax profit was $6.9 million, an increase of $4.8 million on the prior year.

TVNZ declared a final dividend of $4.9 million, being 70% of the normalised after tax profit, to be paid at the end of September.

FINANCIAL MEASURES

FY2010 FY2009

Measurement Actual Target Actual

Profitability Return on average equity (reported earnings) -15.2% 3.5% 1.1% Return on average equity (normalised earnings)* 3.3% 3.5% 1.0% EBITDRA/Core television revenue 11.1% 10.6% 9.1%

Gearing Net interest bearing debt/net interest bearing debt plus equity 18.9% Less than 40% 16.4%

Financial Stability Total equity/Total assets 60.7% More than 40% 60.7%

Interest Cover EBITDRA/Interest expense 10.6 times More than 4 times 12.5 times

*normalised earnings excludes net tax effect of programme amortisation revision, financial instruments/foreign currency gains/(losses) and income tax changes. EBITDRA – earnings before interest, tax, depreciation, amortisation, reorganisation costs and revaluation of financial instruments.


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TVNZ IN SOCIETY

As a Crown entity, TVNZ is expected to be a good employer and to demonstrate social and environmental responsibility. In FY2010 a number of initiatives and programmes were implemented.

ENVIRONMENTAL SUSTAINABILITY TVNZ has continued to proactively mitigate the impact of its operational activities on the environment.

1. Air Travel The nature of TVNZ’s activities is such that air travel is an essential part of operations. However increased use of technology and air travel restrictions imposed internally has meant that there has been a significant reduction in air travel compared to the previous year.

Kilometres Travelled (000)

2010 2009 Reduction % Domestic 2,642 3,260 18.9 Trans Tasman 881 931 5.4 International 3,216 5,874 45.2

Total 6,739 10,065 33.1

2. Vehicle Fleet Fuel efficiency is a key part of the criteria used to determine vehicle selection. This has resulted in a number of changes to the TVNZ vehicle fleet purchasing policy. Where possible diesel vehicles have been selected in preference to petrol powered vehicles.

During FY2010 a total of 14 cars, station wagons, and vans were replaced by diesel powered alternatives.

These vehicles are achieving average fuel savings of 38.4%.

As well as reducing TVNZ ‘s carbon emissions the implementation of the new vehicle selection policy will provide significant reduction in vehicle fuel and maintenance costs in future years.

3. Electricity Usage A number of initiatives aimed at reducing electricity usage have been in place during FY2010. These include turning off lights, PC’s, printers and other equipment overnight and on weekends. The hours of operation of office air conditioning have been reduced to a minimum. As a result electricity consumption for FY2010 at 13,640,861 Kw hrs represents a 6.74% reduction over the previous year.

4. General Waste to Landfill A group of TVNZ volunteers with a commitment to environmental sustainability have implemented a number of ideas focussed on improving the Company’s recycling programme. As a result of this effort during the FY 2010 the amount of General Waste transferred to land fill at 132.7 tonnes represented a reduction of 16.1% over the previous year. The group continues to work with TVNZ’s waste management providers to refine the recycling programme.

COMMUNITY SUPPORT FOUNDATION The TVNZ Community Support Foundation provides charities with free air time worth up to $50,000 a month, which allows the recipients to promote their services and drive fundraising activities.

TVNZ currently has four charitable organisations who were the successful recipients of free on-air advertising until June 30, 2011.

They are:

• TheProstateCancerFoundationofNewZealand • SpecialOlympicsNewZealand • BNZSavetheKiwiTrust • LandSAR(NewZealandLandSearchandRescue)

TVNZ is committed to helping build stronger communities, in the tradition of New Zealanders helping each other out. The charities are all organisations reflecting important aspects of kiwi life and the wellbeing of New Zealand’s people.

TVNZ has provided charitable organisations with more than $30 million in free advertising time on its channels over a period of more than 20 years.

CAPABILITY The response to the recession meant careful prioritisation during this period.

A highly professional programme of business sales development continued with managers undergoing certification for coaching for performance competency. The introduction of the company’s new digital infrastructure has been supported with multi-skilled training on the new equipment for our production services area. News and Current Affairs have had a focus on journalism coaching and training and are preparing for an intense period of training to support the new multi-media model.

Leadership development continued for the senior team through a programme of internal sessions and key external speakers, with support from the University of Auckland short courses. The performance framework was supported by coaching for managers to drive a high performing culture.

FINANCIAL MEASURES

FY2010 FY2009

Measurement Actual Target Actual

Profitability Return on average equity (reported earnings) -15.2% 3.5% 1.1% Return on average equity (normalised earnings)* 3.3% 3.5% 1.0% EBITDRA/Core television revenue 11.1% 10.6% 9.1%

Gearing Net interest bearing debt/net interest bearing debt plus equity 18.9% Less than 40% 16.4%

Financial Stability Total equity/Total assets 60.7% More than 40% 60.7%

Interest Cover EBITDRA/Interest expense 10.6 times More than 4 times 12.5 times

*normalised earnings excludes net tax effect of programme amortisation revision, financial instruments/foreign currency gains/(losses) and income tax changes. EBITDRA – earnings before interest, tax, depreciation, amortisation, reorganisation costs and revaluation of financial instruments.

GOOD EMPLOYER TVNZ has continued with activities to enhance the experience of being part of the TVNZ team. Employees are kept well informed through various communication channels, including strategy and company update sessions with the CEO.

Our culture and branding work has enabled events to bring the magic of television to our own people. Special occasions are celebrated and company-wide networking opportunities are created.

A new performance framework ensures employees have clear objectives and feedback on performance, and the remuneration system that links to this is highly transparent.

Focus remains on supporting employees through change and personal challenges with confidential counselling and outplacement support.

There continues to be support for wellness initiatives such as on-site yoga classes, and subsidies for gym membership. Employees also enjoy a subsidised cafeteria with healthy options and an on-site child care facility.


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GENERAL CHARTER MEASURES

These measures highlight national and international programming across all genres that entertains, informs and educates New Zealand audiences.

General output measures Number of local content hours per genre across TVNZ analogue services*

FY2010 6am - Midnight

1st Run Repeat Total

Entertainment 207.7 320.6 528.3 Factual and Arts 1,034.6 314.0 1,348.6 Kids 241.2 196.0 437.2 Maori 190.9 35.0 225.9 Lifestyle 19.6 70.2 89.8 News and Current Affairs 1,669.0 68.3 1,737.3 Sport 411.2 15.8 427.0

3,774.2 1,019.9 4,794.1

Local Content Totals

TV ONE TV2 TVNZ

Total Hours 3,661.6 1,132.5 4,794.1 % Schedule 55.7% 17.2% 36.5%

* Genres by % of schedule for both digital channels are reported on in the Statement of Service Performance.

General Engagement Measures Average monthly cumulative audience (5+) of TVNZ channels:

• 3,826,950peopleaged5+tunedtoaTVNZchannelin an average month, which represents 96.7% of all the 5+ population

Number of TVNZ programmes within the yearly Top 20 programme lists in the demographics of 5+ and 18-39 (see tables, right)

• 20outof20programmesin5+ • 18outof20programmesin18-39

Online Measures

• TheaveragemonthlynumberofUniqueViewersofTVNZ Ondemand streams for FY2010: 287,348 (Source: Nielsen Online SiteCensus DAV)

• TheaveragemonthlynumberofUniqueBrowsersfor tvnz.co.nz: 1,457,544 (Source Nielsen Online NZ Market Intelligence)

TOP 20 PROGRAMMES

FY2010 - TOTAL PEOPLE

Channel Avg Aud Ratings

1 Cheers to 50 Years of Television TVONE 760,170 19.0

2 Fair Go Ad Awards 2009 TVONE 745,380 18.8

3 South TVONE 727,620 18.3

4 Coastwatch TVONE 674,980 16.8

5 The Politically Incorrect Parenting Show TVONE 656,920 16.6

6 Rapid Response TVONE 660,200 16.5

7 Fair Go TVONE 631,890 15.9

8 Border Patrol TVONE 620,930 15.5

9 Dog Squad TVONE 617,840 15.4

10 Wild Vets TVONE 602,730 15.1

11 One News TVONE 585,490 14.7

12 The Santa Clause TV2 580,580 14.6

13 Animal Rescue TVONE 567,230 14.3

14 Medical Emergency TVONE 565,590 14.2

15 Piha Rescue TVONE 564,570 14.2

16 National Bank Country Calendar TVONE 565,540 14.1

17 Radar’s Patch TVONE 565,310 14.1

18 Border Security TVONE 556,920 14.0

19 Motorway Patrol TV2 551,470 13.9

20 Sensing Murder TV2 546,950 13.6

FY2010 - AP 18-39

Channel Avg Aud Ratings

1 The Longest Yard TV2 219,340 17.4

2 The Santa Clause TV2 210,800 16.9

3 Bruce Almighty TV2 209,760 16.9

4 Motorway Patrol TV2 207,210 16.8

5 Shortland Street TV2 207,230 16.6

6 Monster-In-Law TV2 202,160 16.3

7 The Big Bang Theory TV2 203,560 16.3

8 Cougar Town TV2 201,790 16.0

9 Two and a Half Men TV2 200,350 15.9

10 Neighbours at War TV2 196,950 15.7

11 Sensing Murder TV2 199,190 15.7

12 Highway Patrol TV2 194,200 15.3

13 Grey’s Anatomy TV2 192,150 15.3

14 The Mentalist TV2 189,250 15.2

15 50 First Dates TV2 187,540 15.2

16 Transformers TV3 186,480 15.1

17 Meet the Fockers TV2 185,290 15.0

18 Outrageous Fortune TV3 180,730 14.7

19 Police Ten 7 TV2 182,230 14.6

20 The Middle TV2 182,760 14.5


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CHARTER PERFORMANCE MEASUREMENTS


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For the third year, a full performance measurement framework has been used to assess TVNZ’s non-financial performance as the country’s national television broadcaster.

As in previous years, the approach taken is to summarise the Charter objectives into seven broad themes for measurement –

• Aninformedsociety • NationalIdentity/Citizenship • Maori • Diversity • HighStandards,Innovation • NewZealandtalent

TVNZ programmes are then assessed against each theme through a combination of quality, reach, impact and output measures.

As a way of gauging quality, a unique ‘appreciation/importance survey’ has been used. This asks respondents to rank programmes from the point of view of both a viewer and a citizen. While an individual may not like a particular programme personally, as a citizen they may appreciate the fact that the national television broadcaster makes it available for those who do.

This survey demonstrates the commercial and public value of TVNZ programmes and identifies areas where the company needs to improve its performance.

Reach is a measure of usage. Impact is a measure of external effects such as awards and industry/peer recognition of achievement. Output is the number of hours of content delivered.

QUALITY Appreciation/Importance Survey An independent research company conducted online quantitative research using a representative sample of 1130 people aged 18 and over in June 2010.

The results show perceptions of TVNZ’s delivery in almost all categories has remained stable against last year’s result, with the exception of a small decline in support of local talent.

They also show that having a New Zealand-owned TV network continues to be highly important to nearly all New Zealanders, and that TVNZ is seen as highly valuable to the New Zealand community.

TVNZ PERFORMANCE STABLE TVNZ Performance – Themes 2010 vs. 2009 (Excellent, Very Good) 2010 2009

PERCENT

Consistently high quality programmes

Independent newsEvents of national importance

Analysis of issues of the dayEvents of international importance

Educational for young peopleEvents of importance to your region

Different perspectivesDiscussion on current issues

NZ’s history, heritage, natural environment

Inspiring NZers

Reflects and reinforces our NZ identity

Mix of local and overseas programmes

Supports local talentGood quality local drama

Appeal to smaller and wider audiencesReflects Interests/Tastes not covered

Reflects NZ‘s many culturesUnderstanding different cultures

Deals with minority interests

Maori history, culture, current issues

Promotes Maori language and cultureVoice to Maori perpectives

QUALITY

NATIONAL IDENTITY

NZ TALENT

DIVERSITY

MAORI

20 40 60 80 100

5857

7070

INFORMATION & EDUCATION

0

4445

4241

4243

3940

3130

4140

3736

3434

3538

4337

375454

4542

48

4847

4239

4242

3938

6765

6461

45

4542

39

Base: Total Sample, Test Month N between 1005 – 1130


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TVNZ’s performance as the national broadcaster is stable and strong overall, and Maori are still more positive about the company than the New Zealand population in total.

While TVNZ’s delivery against expectations of consistent high quality is stable, there remains a considerable gap between expectations and perceptions of delivery. This is in line with previous years, and reflects similar levels of expectation for public broadcasters around the world. It is unlikely that performance would ever match expectation and by international standards TVNZ is performing well.

In the areas of information and education, performance is stable but there is seen to be room for improvement in education for young people, providing different perspectives, and events of regional importance.

This survey did not include specific questions about TVNZ’s digital channels, TVNZ 6 and TVNZ 7, which include much programming that comes into the categories of information and education. It is possible that consideration of content on these channels may affect public perceptions in the future.

TVNZ DELIVERING ON INFORMATION & MAORI THEMES Public Importance vs. TVNZ Performance - Themes 2010

Importance (Extremely, Very Important)Performance (Excellent, Very Good)

PERCENT

Consistently high quality programmes

Independent newsEvents of national importance

Analysis of issues of the dayEvents of international importance

Educational for young peopleEvents of importance to your region

Different perspectivesDiscussion on current issues

NZ’s history, heritage, natural environment

Inspiring NZers

Reflects and reinforces our NZ identity

Mix of local and overseas programmes

Supports local talentGood quality local drama

Appeal to smaller and wider audiencesReflects Interests/Tastes not covered

Reflects NZ‘s many culturesUnderstanding different cultures

Deals with minority interests

Maori history, culture, current issues

Promotes Maori language and cultureVoice to Maori perpectives

QUALITY

NATIONAL IDENTITY

NZ TALENT

DIVERSITY

MAORI

20 40 60 80 100

INFORMATION & EDUCATION

0

87

85

84

8361

70

58

44

81

75

72

67

67

65

64

73

3964

47

45

45

42

43

54

54

52

51

51

50

4940

40

41

3130

30

28

33

36

37

38

34

37

42

38

65

Base: Total Sample, N = 1130


14 TVNZ ANNUAL REPORT FY2010

14

TVNZ’s delivery of National Identity programming is stable, and continues to perform especially well in Maori themes.

Maori viewers also continued to rate the importance and performance of most public broadcasting themes more highly than the total survey audience.

Again this year ONE News was considered the most important programme, and was also a clear leader in terms of personal interest.

Other ‘heritage’ programming maintained stable levels of both importance and interest (Country Calendar, Fair Go) and there was a large increase in perceived importance for The Investigator – likely to be the result of the survey taking place close to the broadcast of the episode examining the Bain murders.

In comparison with last year, a number of programmes across a range of genres had declined slightly in perceived importance. However the importance of both Go Girls and Beyond the Darklands increased in line with increased ratings.

Once again, most programmes were considered more important than interesting – notably ANZAC Day coverage which was regarded as highly important but not of high personal interest.

Intrepid Journeys, MasterChef NZ and Shortland Street all had high personal interest relative to importance.

Interests were different among Maori viewers. Core Maori programming such as Te Karere and Marae has significantly

higher interest for Maori than for the total viewing audience, as does Shortland Street, and to a lesser extent, Intrepid Journeys. Conversely, Maori viewers had less interest than the total audience in Fair Go and Country Calendar.

COMPLIANCE WITH STANDARDS AND CODES Formal complaints The Broadcasting Standards Authority (BSA) is responsible under the Broadcasting Act 1989 for administering standards in programming and presentation of programming. All formal complaints must be first made in writing to the Broadcaster (with the exception of allegations of privacy). Complainants may refer their complaint to the BSA if they are not satisfied with the outcome of the TVNZ process.

In the period under review, TVNZ received 800 formal complaints.

• 216morethaninthepreviousyear.

• Ofthese800complaints,211wereupheldbythe TVNZ Complaints Committee.

• Oftheseupholdsthemajorityconcernedtwo programmes (182 complaints).

2008 2009 2010

491 complaints 584 complaints 800 complaints

17 upheld 78 upheld 211 upheld (182 for 2 programmes)

NEw ZEALAND OwNED NETwORk STILL IMPORTANT TO NEARLy ALL NEw ZEALANDERS Importance of New Zealand owned TV network - over time

Not important at all

Not very important

Quite important

Very important

Extremely important

0

20

40

60

80

100

PERC

ENT

2008 2009 2010

12

13

25

59

13

9

24

62

14

10

22

63



15

In FY2010 the BSA handled 75 referrals about TVNZ programming – an increase of 6 referrals on the previous year (referrals are counted per programme). Of these 9 were upheld by the BSA*.

2008 2009 2010

41 referred 69 complaints 75 complaints

11 upheld 18 upheld 9 upheld*

*14 referrals had yet to be decided by the BSA.

AWARDS AND RECOGNITION Qantas Television Awards In the Qantas Television Awards for 2010, TVNZ won 11 of the 12 awards in the News and Current Affairs category including Best News.

Current Affairs programmes Sunday, Close Up and 20/20 also had outstanding results – 20/20 won one award, Close Up won two, including Journalist of the Year, and Sunday won three, including Best Investigation.

Seventeen of the 25 awards in the General TV category were also won by or screened on TVNZ.

In April, TVNZ’s first online-only interactive drama Reservoir Hill won an Emmy Award - New Zealand’s first international Emmy.

The interactive drama, which played out online in weekly episodes last year on TVNZ Ondemand, won the Digital Emmy for programmes aimed at children or young people, against competition from shows from Hong Kong, Canada, Finland and the UK.

The online drama was a New Zealand first from David Stubbs and Thomas Robins from KHF Media.

In other industry awards, TVNZ’s creative services staff won three Gold’s in the Promax Awards – for Best Drama Promo, Best Drama campaign, and Best scriptwriting.

They also won a Bronze and four Silvers, for Best editing, Best News and Current Affairs promo, Best on-air branding design and Best on-air ident design.

TVNZ’s marketing staff won Silver for an Integrated Campaign (Shortland Street Christmas campaign) in the Proximity Worldwide Network Awards, and in the RSVP Awards for results-focussed marketing they won Bronze for customer engagement for the same campaign.

TVNZ won Bronze in the Effie Awards which combine all the disciplines of successful marketing in the consumer durables category (Ford Car is the Star).

TVNZ VALuE TO THE NEw ZEALAND COMMuNITy IS INCREASING Overall value of TVNZ to New Zealand community - over time

Not valuable at all

Not very valuable

Quite valuable

Very valuable

Extremely valuable

0

20

40

60

80

100

PERC

ENT

2008 2009 2010

6

28

37

29

14 4

28

38

30

1

24

38

33



16 TVNZ ANNUAL REPORT FY2010

16

OUTPUT AND REACH Charter themes

The assessment of which Charter themes were reflected in each programme broadcast in the 12 months under review was carried out using two guiding principles:

• PreferencewouldbegiventoselectionofNewZealand programming, on the assumption that it would have an impact intrinsically greater than that of overseas programming.

• Internationalprogrammessuchasthelargenumberofnatural history, lifestyle or wildlife documentaries where the emphasis was judged to be as much on entertainment as on information, would not be included.

8857

53

53

46

2826

9

12

256

2412

3

3

24

23

22

21

21

4

2

18

181

173

1621

1

ONE News

Fair GoCountry Calender

Netball (National and International)Sunday

Q & AIntrepid Journeys

The InvestigatorWhat Now?

Rural DeliveryBeyond the Darklands

Attitude

Tagata PasifikaGo Girls

Marae

Studio 2Let’s Get Inventin

The Apprentice New ZealandShortland Street

Waka Huia

TV ONE Anzac Day Coverage

Masterchef New Zealand

Te Karere

Asia Down Under

Praise Be

6318

36

3247

22

27

27

13

2626

2

194

4

11

16

15

0 20 40 60 80 100

PERCENT

17

44

GAP REMAINS BETwEEN IMPORTANCE AND PERSONAL INTEREST Public Importance vs. TVNZ Performance - Programmes 2010

Importance (Extremely, Very Important)Interest (‘put off other things’, ‘watching if it was on’)

Base: N between 391 - 1130


17

Definitions An Informed Society Providing impartial and comprehensive information and national and international programming that is essential to having an informed and educated society.

National Identity/Citizenship Providing entertaining and informative programming that reflects the diverse range of cultures and interests that contribute to an overall sense of who we are as New Zealanders.

Maori Providing entertaining and informative programming that reflects Maori interests, culture, and language and conveys these interests to a wider NZ audience.

Diversity Providing entertaining national and international programmes that service the interests and needs of different audiences, including cultures, lifestyles, age and regions, and particularly those that may not be provided for in a purely commercial broadcasting environment.

Innovation Promoting innovation, risk-taking and creativity.

New Zealand Talent Supporting and promoting the talents and the creative resources of New Zealanders.

High Standards Promoting high programming standards and editorial integrity.

Note: The description of the output measure for programmes exhibiting High Standards is hours of local shows/films TVNZ has funded/co-funded or commissioned. Because the category includes titles that are yet to be screened, and are therefore still commercially sensitive, only the total for the period is given. The total count for the full financial year across all channels is 1938.3 hours.


18

FOR THE YEAR ENDED 30 JUNE 2010CHARTER PERFORMANCE MEASUREMENTS

20/20 TV2 NCA 10.2 - 10.2 10.2 2,650,330 66.5% ✓ ✓ 50 Years of Television TV ONE Entertainment 2.0 - 2.0 2.0 1,311,080 32.7% ✓ ✓ ✓ Activate TV2 Children’s 4.5 9.0 13.5 13.5 924,940 23.2% ✓ Adventures of Massey Ferguson TV2 Pre School 0.8 - 0.8 - 291,010 7.3% ✓ An Irish Homecoming TV ONE Doco - 0.5 0.5 - 41,500 1.0% ✓ ✓ ✓ Animal Academy TVNZ 6 Factual - 44.1 - n/a n/a ✓ Animal House TV ONE Factual 4.5 1.0 5.5 5.5 1,938,850 48.4% ✓ ANZAC Day National Wreath-laying TV ONE SI 1.5 - 1.5 1.5 237,130 5.9% ✓ ✓ ✓ Are We There Yet? TV ONE Factual - 3.5 3.5 3.5 462,580 11.7% ✓ ✓ Are You Smarter than a Ten Year Old? TV2 Entertainment - 4.0 4.0 4.0 490,940 12.4% ✓ ✓ Artsville TVNZ 7 Arts - 27.5 27.5 n/a n/a ✓ ✓ ✓ ASB Polyfest TVNZ 6 SI - 21.5 - n/a n/a ✓ ✓ ✓ ✓ ASB Polyfest TV2 SI 2.5 - 2.5 - 408,670 10.2% ✓ ✓ ✓ ✓ Asia Downunder TVNZ 7 SI - 87.1 87.1 n/a n/a ✓ ✓ Asia Downunder TV ONE SI 19.0 1.0 20.0 20.0 935,350 23.5% ✓ ✓ Attitude TVNZ 7 SI - 64.2 64.2 n/a n/a ✓ Attitude TV ONE SI 22.0 4.8 26.8 26.8 1,227,000 30.8% ✓ Auction House TV ONE Factual - 3.0 3.0 3.0 275,960 6.9% ✓ Back Benches TVNZ 7 NCA - 193.3 - n/a n/a ✓ Back Benches Specials TVNZ 7 NCA - 15.8 - n/a n/a ✓ Back Benches Summer Tour TVNZ 7 NCA - 40.0 - n/a n/a ✓ Beat Squad TV ONE Factual - 1.0 1.0 1.0 612,910 15.4% ✓ Best In Show TV ONE Factual - 5.0 5.0 5.0 400,270 10.0% ✓ Best of Breakfast TVNZ 7 NCA - 85.8 - n/a n/a ✓ Best of Breakfast TV ONE NCA - 23.0 23.0 - 761,170 19.1% ✓ Best of Business & Breakfast TVNZ 7 NCA - 460.0 - n/a n/a ✓ Best of Waka Huia TV ONE SI - 11.0 11.0 11.0 735,040 18.3% ✓ ✓ ✓ Beyond the Darklands TV ONE Factual 7.0 - 7.0 7.0 1,692,430 42.2% ✓ ✓ Birdland TV ONE Factual 3.5 - 3.5 3.5 1,619,750 40.8% ✓ ✓ Black Sheep TV2 Drama - 1.5 1.5 1.5 791,740 19.7% ✓ ✓ Blues Clues TV2 Pre School - 80.0 80.0 80.0 1,325,970 33.2% ✓ Border Patrol TV ONE Factual 1.0 5.5 6.5 6.5 1,568,560 39.5% ✓ Borderline TV ONE Factual - 3.5 3.5 3.5 572,170 14.3% ✓ Brain Power TV ONE Doco - 3.0 3.0 3.0 351,690 8.9% ✓ ✓ ✓ Breakfast TV ONE NCA 594.1 - 594.1 - 2,680,540 67.2% ✓ Business TV ONE NCA 115.5 - 115.5 - 1,178,880 29.6% ✓ Business Weekend TVNZ 7 NCA - 78.3 - n/a n/a ✓ Business Weekend TV ONE NCA 11.0 11.5 22.5 - 465,610 11.7% ✓ Buzzy Bee & Friends TV2 Pre School - 1.5 1.5 1.5 404,190 10.1% ✓ Carols in the Caves TV ONE SI 1.0 - 1.0 1.0 276,530 7.0% ✓ ✓ ✓ Chasing the Ghost TV ONE Doco 1.0 - 1.0 1.0 812,310 20.5% ✓ ✓ ✓ Children’s Day Compile TVNZ 6 Factual - 1.1 - n/a n/a ✓ ✓ ✓ Chuggington TV2 Pre School - 22.6 22.6 - 1,024,040 25.8% ✓ Clifford Puppy Days TV2 Pre School - 6.0 6.0 - 238,040 5.9% ✓ Close Up TVNZ 7 NCA - 99.2 - n/a n/a ✓ Close Up TV ONE NCA 120.5 - 120.5 120.5 3,452,730 86.6% ✓ Close Up Weekend TVNZ 7 NCA - 45.4 - n/a n/a ✓ Coastwatch TV ONE Factual 4.5 5.5 10.0 10.0 2,306,900 57.8% ✓ Colour of War: The Anzacs TVNZ 7 Factual - 7.5 - n/a n/a ✓ ✓ Comedy Christmas Gala TV2 Comedy - 0.5 0.5 0.5 223,440 5.6% ✓ ✓ Cool Kids Cooking TV2 Children’s 1.7 8.0 9.7 9.7 1,262,150 31.7% ✓

FIRST REPEAT TOTAL HOURS OF 5+ REACH 5+ REACH IN Informed National Identity/ PROGRAMME TITLE CHANNEL GENRE RUN HOURS HOURS CAPTIONING IN UNITS PERCENTAGE Society Citizenship Maori Diversity NZ Talent Innovation


19

20/20 TV2 NCA 10.2 - 10.2 10.2 2,650,330 66.5% ✓ ✓ 50 Years of Television TV ONE Entertainment 2.0 - 2.0 2.0 1,311,080 32.7% ✓ ✓ ✓ Activate TV2 Children’s 4.5 9.0 13.5 13.5 924,940 23.2% ✓ Adventures of Massey Ferguson TV2 Pre School 0.8 - 0.8 - 291,010 7.3% ✓ An Irish Homecoming TV ONE Doco - 0.5 0.5 - 41,500 1.0% ✓ ✓ ✓ Animal Academy TVNZ 6 Factual - 44.1 - n/a n/a ✓ Animal House TV ONE Factual 4.5 1.0 5.5 5.5 1,938,850 48.4% ✓ ANZAC Day National Wreath-laying TV ONE SI 1.5 - 1.5 1.5 237,130 5.9% ✓ ✓ ✓ Are We There Yet? TV ONE Factual - 3.5 3.5 3.5 462,580 11.7% ✓ ✓ Are You Smarter than a Ten Year Old? TV2 Entertainment - 4.0 4.0 4.0 490,940 12.4% ✓ ✓ Artsville TVNZ 7 Arts - 27.5 27.5 n/a n/a ✓ ✓ ✓ ASB Polyfest TVNZ 6 SI - 21.5 - n/a n/a ✓ ✓ ✓ ✓ ASB Polyfest TV2 SI 2.5 - 2.5 - 408,670 10.2% ✓ ✓ ✓ ✓ Asia Downunder TVNZ 7 SI - 87.1 87.1 n/a n/a ✓ ✓ Asia Downunder TV ONE SI 19.0 1.0 20.0 20.0 935,350 23.5% ✓ ✓ Attitude TVNZ 7 SI - 64.2 64.2 n/a n/a ✓ Attitude TV ONE SI 22.0 4.8 26.8 26.8 1,227,000 30.8% ✓ Auction House TV ONE Factual - 3.0 3.0 3.0 275,960 6.9% ✓ Back Benches TVNZ 7 NCA - 193.3 - n/a n/a ✓ Back Benches Specials TVNZ 7 NCA - 15.8 - n/a n/a ✓ Back Benches Summer Tour TVNZ 7 NCA - 40.0 - n/a n/a ✓ Beat Squad TV ONE Factual - 1.0 1.0 1.0 612,910 15.4% ✓ Best In Show TV ONE Factual - 5.0 5.0 5.0 400,270 10.0% ✓ Best of Breakfast TVNZ 7 NCA - 85.8 - n/a n/a ✓ Best of Breakfast TV ONE NCA - 23.0 23.0 - 761,170 19.1% ✓ Best of Business & Breakfast TVNZ 7 NCA - 460.0 - n/a n/a ✓ Best of Waka Huia TV ONE SI - 11.0 11.0 11.0 735,040 18.3% ✓ ✓ ✓ Beyond the Darklands TV ONE Factual 7.0 - 7.0 7.0 1,692,430 42.2% ✓ ✓ Birdland TV ONE Factual 3.5 - 3.5 3.5 1,619,750 40.8% ✓ ✓ Black Sheep TV2 Drama - 1.5 1.5 1.5 791,740 19.7% ✓ ✓ Blues Clues TV2 Pre School - 80.0 80.0 80.0 1,325,970 33.2% ✓ Border Patrol TV ONE Factual 1.0 5.5 6.5 6.5 1,568,560 39.5% ✓ Borderline TV ONE Factual - 3.5 3.5 3.5 572,170 14.3% ✓ Brain Power TV ONE Doco - 3.0 3.0 3.0 351,690 8.9% ✓ ✓ ✓ Breakfast TV ONE NCA 594.1 - 594.1 - 2,680,540 67.2% ✓ Business TV ONE NCA 115.5 - 115.5 - 1,178,880 29.6% ✓ Business Weekend TVNZ 7 NCA - 78.3 - n/a n/a ✓ Business Weekend TV ONE NCA 11.0 11.5 22.5 - 465,610 11.7% ✓ Buzzy Bee & Friends TV2 Pre School - 1.5 1.5 1.5 404,190 10.1% ✓ Carols in the Caves TV ONE SI 1.0 - 1.0 1.0 276,530 7.0% ✓ ✓ ✓ Chasing the Ghost TV ONE Doco 1.0 - 1.0 1.0 812,310 20.5% ✓ ✓ ✓ Children’s Day Compile TVNZ 6 Factual - 1.1 - n/a n/a ✓ ✓ ✓ Chuggington TV2 Pre School - 22.6 22.6 - 1,024,040 25.8% ✓ Clifford Puppy Days TV2 Pre School - 6.0 6.0 - 238,040 5.9% ✓ Close Up TVNZ 7 NCA - 99.2 - n/a n/a ✓ Close Up TV ONE NCA 120.5 - 120.5 120.5 3,452,730 86.6% ✓ Close Up Weekend TVNZ 7 NCA - 45.4 - n/a n/a ✓ Coastwatch TV ONE Factual 4.5 5.5 10.0 10.0 2,306,900 57.8% ✓ Colour of War: The Anzacs TVNZ 7 Factual - 7.5 - n/a n/a ✓ ✓ Comedy Christmas Gala TV2 Comedy - 0.5 0.5 0.5 223,440 5.6% ✓ ✓ Cool Kids Cooking TV2 Children’s 1.7 8.0 9.7 9.7 1,262,150 31.7% ✓



20

Country Calendar TVNZ 6 Factual - 11.3 - n/a n/a ✓ ✓ Crime and Punishment TV ONE Doco 1.0 - 1.0 1.0 715,040 17.8% ✓ ✓ ✓ Dare To Win TV2 Entertainment - 1.0 1.0 - 236,510 5.9% ✓ ✓ Death on the Beach TV ONE Doco - 0.6 0.6 - 95,490 2.4% ✓ ✓ ✓ Deer Wars TV ONE Doco - 0.4 0.4 0.4 135,090 3.4% ✓ ✓ ✓ Dog Squad TV ONE Factual 5.0 - 5.0 5.0 2,140,500 53.4% ✓ Drag Racing TV ONE Sport 2.0 - 2.0 - 323,400 8.1% ✓ ✓ Eating for Two TV ONE Doco 1.0 1.0 2.0 2.0 851,850 21.5% ✓ ✓ ✓ Erebus the Aftermath TV ONE Doco - 2.8 2.8 2.8 450,530 11.4% ✓ ✓ ✓ Erin Simpson Show TV2 Children’s 67.0 11.0 78.0 - 2,222,910 55.8% ✓ Fair Go TV ONE Factual 14.5 9.5 24.0 24.0 2,798,870 70.4% ✓ Farmers Santa Parade TV2 Entertainment 0.5 - 0.5 0.5 33,750 0.9% ✓ ✓ Fatal Attraction TV ONE Doco 1.0 - 1.0 1.0 63,830 1.6% ✓ ✓ ✓ Festival of Nine Lessons TV ONE SI 0.4 1.5 1.9 - 208,900 5.3% ✓ ✓ ✓ FIFA World Cup Soccer TVNZ 7 Sport - 64.1 - n/a n/a ✓ ✓ FIFA World Cup Soccer TV ONE Sport 28.2 15.8 44.0 - 2,805,880 70.0% ✓ ✓ Firefighters TV ONE Factual - 3.5 3.5 3.5 505,170 12.6% ✓ ✓ Frontier of Dreams TV ONE Doco - 11.7 11.7 11.7 385,750 9.6% ✓ ✓ ✓ Gardens of the World TV ONE Factual - 1.5 1.5 - 222,490 5.6% ✓ ✓ Get A Life Coach TV ONE Doco - 0.9 0.9 0.9 142,810 3.6% ✓ ✓ ✓ Giggles TVNZ 6 Pre School - - 90.9 - n/a n/a ✓ Go Girls TV2 Drama 13.0 13.0 26.0 26.0 2,629,920 65.6% ✓ ✓ Go Show TV2 Pre School - 76.8 76.8 76.8 1,273,290 31.9% ✓ Good Morning TV ONE Factual 660.0 - 660.0 - 2,916,980 73.1% ✓ ✓ ✓ Great Kiwi Christmas Comedy Gala TV2 Comedy 2.0 - 2.0 2.0 921,010 23.2% ✓ ✓ Ground Rules 2 TV ONE Factual - 5.0 5.0 5.0 360,120 9.1% ✓ Handy Manny TV2 Pre School 5.5 23.5 29.0 29.0 958,590 24.0% ✓ Hayley Westenra in Concert TV ONE Entertainment - 0.6 0.6 - 103,760 2.6% ✓ ✓ Hi-5 TV2 Pre School 22.5 106.5 129.0 129.0 1,110,370 27.8% ✓ Highway of Legends TV ONE Entertainment - 1.0 1.0 - 174,470 4.4% ✓ ✓ Highway Patrol TV2 Factual 5.0 - 5.0 5.0 2,100,410 52.4% ✓ ✓ Homefront Extra TV ONE Factual - 4.3 4.3 - 411,550 10.3% ✓ Homegrown TV ONE Factual - 3.5 3.5 3.5 429,290 10.8% ✓ ✓ Horse of the Year TV ONE Sport 2.5 - 2.5 - 349,400 8.7% ✓ ✓ House & Garden Extra TV ONE Factual - 0.8 0.8 - 156,850 4.0% ✓ ✓ How Clean Is Your House? TV ONE Factual - 10.0 10.0 10.0 759,460 19.0% ✓ How the Other Half Lives TV ONE Factual - 3.5 3.5 3.5 1,462,780 36.7% ✓ ✓ Hunger for the Wild TV ONE Factual - 9.0 9.0 9.0 1,698,110 42.8% ✓ ✓ ✓

I Am TV TV2 SI 34.0 - 34.0 - 1,049,240 26.3% ✓ ✓ ✓ I Am TV Presents The Outlook for Someday TVNZ 6 SI - - 0.8 - n/a n/a ✓ ✓ ✓ Ice TV ONE Factual - 2.9 2.9 2.9 1,138,710 28.4% Illegal NZ TV2 Factual 3.5 - 3.5 3.5 1,896,850 47.8% ✓ ✓ In The Night Garden TV2 Pre School - 69.5 69.5 69.5 1,177,760 29.5% ✓ InBeTween TVNZ 6 Children’s - - 65.3 - n/a n/a ✓ ✓

Indy Racing League TV ONE Sport 2.9 - 2.9 - 442,600 11.0% ✓ ✓ Intrepid Journeys TV ONE Factual 7.0 22.0 29.0 29.0 2,280,600 57.3% ✓ IRB Sevens TV ONE Sport 21.7 - 21.7 - 2,006,600 50.2% ✓ ✓ Is She Or Isn’t He? TV ONE Doco 1.0 - 1.0 1.0 916,500 22.9% ✓ ✓ Island Wars TV2 Entertainment 10.0 - 10.0 10.0 2,195,540 55.3% ✓ Jack of All Trades TV ONE Factual 8.0 - 8.0 - 680,330 17.1% ✓ Jonah - Dare To Dream TV ONE Doco - 1.3 1.3 1.3 129,040 3.2% ✓ ✓



21

Country Calendar TVNZ 6 Factual - 11.3 - n/a n/a ✓ ✓ Crime and Punishment TV ONE Doco 1.0 - 1.0 1.0 715,040 17.8% ✓ ✓ ✓ Dare To Win TV2 Entertainment - 1.0 1.0 - 236,510 5.9% ✓ ✓ Death on the Beach TV ONE Doco - 0.6 0.6 - 95,490 2.4% ✓ ✓ ✓ Deer Wars TV ONE Doco - 0.4 0.4 0.4 135,090 3.4% ✓ ✓ ✓ Dog Squad TV ONE Factual 5.0 - 5.0 5.0 2,140,500 53.4% ✓ Drag Racing TV ONE Sport 2.0 - 2.0 - 323,400 8.1% ✓ ✓ Eating for Two TV ONE Doco 1.0 1.0 2.0 2.0 851,850 21.5% ✓ ✓ ✓ Erebus the Aftermath TV ONE Doco - 2.8 2.8 2.8 450,530 11.4% ✓ ✓ ✓ Erin Simpson Show TV2 Children’s 67.0 11.0 78.0 - 2,222,910 55.8% ✓ Fair Go TV ONE Factual 14.5 9.5 24.0 24.0 2,798,870 70.4% ✓ Farmers Santa Parade TV2 Entertainment 0.5 - 0.5 0.5 33,750 0.9% ✓ ✓ Fatal Attraction TV ONE Doco 1.0 - 1.0 1.0 63,830 1.6% ✓ ✓ ✓ Festival of Nine Lessons TV ONE SI 0.4 1.5 1.9 - 208,900 5.3% ✓ ✓ ✓ FIFA World Cup Soccer TVNZ 7 Sport - 64.1 - n/a n/a ✓ ✓ FIFA World Cup Soccer TV ONE Sport 28.2 15.8 44.0 - 2,805,880 70.0% ✓ ✓ Firefighters TV ONE Factual - 3.5 3.5 3.5 505,170 12.6% ✓ ✓ Frontier of Dreams TV ONE Doco - 11.7 11.7 11.7 385,750 9.6% ✓ ✓ ✓ Gardens of the World TV ONE Factual - 1.5 1.5 - 222,490 5.6% ✓ ✓ Get A Life Coach TV ONE Doco - 0.9 0.9 0.9 142,810 3.6% ✓ ✓ ✓ Giggles TVNZ 6 Pre School - - 90.9 - n/a n/a ✓ Go Girls TV2 Drama 13.0 13.0 26.0 26.0 2,629,920 65.6% ✓ ✓ Go Show TV2 Pre School - 76.8 76.8 76.8 1,273,290 31.9% ✓ Good Morning TV ONE Factual 660.0 - 660.0 - 2,916,980 73.1% ✓ ✓ ✓ Great Kiwi Christmas Comedy Gala TV2 Comedy 2.0 - 2.0 2.0 921,010 23.2% ✓ ✓ Ground Rules 2 TV ONE Factual - 5.0 5.0 5.0 360,120 9.1% ✓ Handy Manny TV2 Pre School 5.5 23.5 29.0 29.0 958,590 24.0% ✓ Hayley Westenra in Concert TV ONE Entertainment - 0.6 0.6 - 103,760 2.6% ✓ ✓ Hi-5 TV2 Pre School 22.5 106.5 129.0 129.0 1,110,370 27.8% ✓ Highway of Legends TV ONE Entertainment - 1.0 1.0 - 174,470 4.4% ✓ ✓ Highway Patrol TV2 Factual 5.0 - 5.0 5.0 2,100,410 52.4% ✓ ✓ Homefront Extra TV ONE Factual - 4.3 4.3 - 411,550 10.3% ✓ Homegrown TV ONE Factual - 3.5 3.5 3.5 429,290 10.8% ✓ ✓ Horse of the Year TV ONE Sport 2.5 - 2.5 - 349,400 8.7% ✓ ✓ House & Garden Extra TV ONE Factual - 0.8 0.8 - 156,850 4.0% ✓ ✓ How Clean Is Your House? TV ONE Factual - 10.0 10.0 10.0 759,460 19.0% ✓ How the Other Half Lives TV ONE Factual - 3.5 3.5 3.5 1,462,780 36.7% ✓ ✓ Hunger for the Wild TV ONE Factual - 9.0 9.0 9.0 1,698,110 42.8% ✓ ✓ ✓

I Am TV TV2 SI 34.0 - 34.0 - 1,049,240 26.3% ✓ ✓ ✓ I Am TV Presents The Outlook for Someday TVNZ 6 SI - - 0.8 - n/a n/a ✓ ✓ ✓ Ice TV ONE Factual - 2.9 2.9 2.9 1,138,710 28.4% Illegal NZ TV2 Factual 3.5 - 3.5 3.5 1,896,850 47.8% ✓ ✓ In The Night Garden TV2 Pre School - 69.5 69.5 69.5 1,177,760 29.5% ✓ InBeTween TVNZ 6 Children’s - - 65.3 - n/a n/a ✓ ✓

Indy Racing League TV ONE Sport 2.9 - 2.9 - 442,600 11.0% ✓ ✓ Intrepid Journeys TV ONE Factual 7.0 22.0 29.0 29.0 2,280,600 57.3% ✓ IRB Sevens TV ONE Sport 21.7 - 21.7 - 2,006,600 50.2% ✓ ✓ Is She Or Isn’t He? TV ONE Doco 1.0 - 1.0 1.0 916,500 22.9% ✓ ✓ Island Wars TV2 Entertainment 10.0 - 10.0 10.0 2,195,540 55.3% ✓ Jack of All Trades TV ONE Factual 8.0 - 8.0 - 680,330 17.1% ✓ Jonah - Dare To Dream TV ONE Doco - 1.3 1.3 1.3 129,040 3.2% ✓ ✓



22

Just the Job TVNZ 6 Children’s - - 55.9 55.9 n/a n/a ✓ Just the Job TV2 Children’s 5.0 5.0 10.0 10.0 861,250 21.6% ✓ Kapa Haka Kids TV2 SI 2.0 - 2.0 - 473,390 11.8% ✓ ✓ ✓ ✓ Karting TV ONE Sport 1.0 - 1.0 - 198,530 5.0% ✓ ✓ Kidzone TVNZ 6 Pre School - - 729.2 - n/a n/a ✓ Killian Curse TV2 Children’s - 3.5 3.5 3.5 520,630 13.0% ✓ ✓ Kiwis at War TV ONE Doco - 0.5 0.5 0.5 508,760 12.7% ✓ ✓ ✓ Korero Mai TVNZ 6 Maori - - 21.2 - n/a n/a ✓ ✓ ✓ Korero Mai TV2 SI 21.0 38.2 59.2 - 1,199,630 30.1% ✓ ✓ ✓ Leigh Hart’s Mysterious Planet TV ONE Factual 6.0 - 6.0 6.0 1,336,680 33.3% ✓

Leo’s Pride TV ONE Doco - 1.5 1.5 1.5 112,080 2.8% ✓ ✓ ✓ Let’s Get Inventin’ TVNZ 6 Children’s - - 44.9 44.9 n/a n/a ✓ Let’s Get Inventin’ TV2 Children’s 5.0 5.0 10.0 10.0 1,372,320 34.2% ✓ Life’s A Riot TV ONE Drama 1.6 - 1.6 1.6 875,230 22.1% ✓ ✓ Line of Fire TV ONE Doco 3.0 - 3.0 3.0 1,372,690 34.6% ✓ ✓ ✓ Little Bear TV2 Pre School - 8.5 8.5 - 674,610 16.8% ✓ Little Einsteins TV2 Pre School 9.5 53.0 62.5 62.5 1,443,140 36.2% ✓ Location Location Location TV ONE Factual - 7.0 7.0 7.0 733,570 18.3% ✓ Lost Dreaming TV ONE Doco - 0.6 0.6 - 52,690 1.3% ✓ ✓ Lost in Libya TV ONE Doco - 1.0 1.0 1.0 115,230 2.9% ✓ ✓ ✓ Making Italy Home TV ONE Factual - 2.5 2.5 2.5 461,780 11.5% ✓ Marae TVNZ 7 SI - - 62.5 - n/a n/a ✓ ✓ ✓ Marae TV ONE SI 20.0 1.5 21.5 - 874,660 21.9% ✓ ✓ ✓ Marae Summer Season TVNZ 7 SI - - 25.0 - n/a n/a ✓ ✓ ✓ Marae Summer Season TV ONE SI 5.0 - 5.0 - 296,610 7.4% ✓ ✓ ✓ Master Raindrop TV2 Pre School - 10.5 10.5 10.5 684,610 17.1% ✓ Masterchef New Zealand TV ONE Factual 14.0 1.0 15.0 15.0 2,466,330 61.5% ✓ ✓ Matthew & Marc’s Rocky Road to Bollywood TV2 Entertainment 3.0 - 3.0 3.0 1,508,120 37.6% ✓ ✓ Media 7 TVNZ 7 NCA - - 183.7 - n/a n/a ✓ Media 7 Specials TVNZ 7 NCA - - 25.0 - n/a n/a ✓ Meet the Locals TVNZ 6 Factual - - 128.1 - n/a n/a ✓ ✓ ✓ Mickey Mouse Clubhouse TV2 Pre School - 25.5 25.5 25.5 727,240 18.2% ✓ Milly Molly TV2 Pre School 8.6 - 8.6 - 760,020 19.0% ✓ Minority Voice TVNZ 7 Factual - - 25.8 25.8 n/a n/a ✓ ✓ Minority Voices TV ONE SI 5.0 - 5.0 5.0 400,640 10.0% ✓ ✓ Moto GP 2010 TV ONE Sport 1.0 - 1.0 - 94,620 2.4% ✓ ✓ Motocross TV ONE Sport 1.4 - 1.4 - 268,400 6.7% ✓ ✓ Motorcycling TV ONE Sport 3.9 - 3.9 - 404,100 10.1% ✓ ✓ Motorway Patrol TV2 Factual 4.5 8.0 12.5 12.5 2,603,480 65.6% ✓ ✓ Mucking In TV ONE Factual 5.5 27.8 33.3 33.3 2,005,970 50.3% ✓ My Friends Tigger and Pooh TV2 Pre School 19.5 33.5 53.0 53.0 1,410,230 35.3% ✓ My God TVNZ 7 SI - - 2.5 2.5 n/a n/a ✓ ✓ My God TV ONE SI 4.5 - 4.5 4.5 417,420 10.4% ✓ ✓ My House My Castle TV2 Factual 4.0 - 4.0 4.0 2,045,900 51.5% ✓ National Bank Country Calendar TV ONE Factual 17.0 38.5 55.5 55.5 2,866,670 71.8% ✓ ✓ National Bank Young Farmer TVNZ 6 Factual - - 1.7 - n/a n/a ✓ ✓ National Bank Young Farmer TV ONE Factual 2.0 - 2.0 2.0 442,200 11.1% ✓ ✓ Netball - ANZ Champs TV ONE Sport 30.6 - 30.6 - 1,661,900 41.6% ✓ ✓ Netball - Aust Test/International Series TV ONE Sport 15.8 - 15.8 - 2,041,900 51.4% ✓ ✓ Netball - NZ/Aust v World/World Series TV ONE Sport 14.5 - 14.5 - 1,993,700 50.2% ✓ ✓ New Artland TVNZ 6 Arts - - 63.8 - n/a n/a ✓ ✓ ✓ ✓



23

Just the Job TVNZ 6 Children’s - - 55.9 55.9 n/a n/a ✓ Just the Job TV2 Children’s 5.0 5.0 10.0 10.0 861,250 21.6% ✓ Kapa Haka Kids TV2 SI 2.0 - 2.0 - 473,390 11.8% ✓ ✓ ✓ ✓ Karting TV ONE Sport 1.0 - 1.0 - 198,530 5.0% ✓ ✓ Kidzone TVNZ 6 Pre School - - 729.2 - n/a n/a ✓ Killian Curse TV2 Children’s - 3.5 3.5 3.5 520,630 13.0% ✓ ✓ Kiwis at War TV ONE Doco - 0.5 0.5 0.5 508,760 12.7% ✓ ✓ ✓ Korero Mai TVNZ 6 Maori - - 21.2 - n/a n/a ✓ ✓ ✓ Korero Mai TV2 SI 21.0 38.2 59.2 - 1,199,630 30.1% ✓ ✓ ✓ Leigh Hart’s Mysterious Planet TV ONE Factual 6.0 - 6.0 6.0 1,336,680 33.3% ✓

Leo’s Pride TV ONE Doco - 1.5 1.5 1.5 112,080 2.8% ✓ ✓ ✓ Let’s Get Inventin’ TVNZ 6 Children’s - - 44.9 44.9 n/a n/a ✓ Let’s Get Inventin’ TV2 Children’s 5.0 5.0 10.0 10.0 1,372,320 34.2% ✓ Life’s A Riot TV ONE Drama 1.6 - 1.6 1.6 875,230 22.1% ✓ ✓ Line of Fire TV ONE Doco 3.0 - 3.0 3.0 1,372,690 34.6% ✓ ✓ ✓ Little Bear TV2 Pre School - 8.5 8.5 - 674,610 16.8% ✓ Little Einsteins TV2 Pre School 9.5 53.0 62.5 62.5 1,443,140 36.2% ✓ Location Location Location TV ONE Factual - 7.0 7.0 7.0 733,570 18.3% ✓ Lost Dreaming TV ONE Doco - 0.6 0.6 - 52,690 1.3% ✓ ✓ Lost in Libya TV ONE Doco - 1.0 1.0 1.0 115,230 2.9% ✓ ✓ ✓ Making Italy Home TV ONE Factual - 2.5 2.5 2.5 461,780 11.5% ✓ Marae TVNZ 7 SI - - 62.5 - n/a n/a ✓ ✓ ✓ Marae TV ONE SI 20.0 1.5 21.5 - 874,660 21.9% ✓ ✓ ✓ Marae Summer Season TVNZ 7 SI - - 25.0 - n/a n/a ✓ ✓ ✓ Marae Summer Season TV ONE SI 5.0 - 5.0 - 296,610 7.4% ✓ ✓ ✓ Master Raindrop TV2 Pre School - 10.5 10.5 10.5 684,610 17.1% ✓ Masterchef New Zealand TV ONE Factual 14.0 1.0 15.0 15.0 2,466,330 61.5% ✓ ✓ Matthew & Marc’s Rocky Road to Bollywood TV2 Entertainment 3.0 - 3.0 3.0 1,508,120 37.6% ✓ ✓ Media 7 TVNZ 7 NCA - - 183.7 - n/a n/a ✓ Media 7 Specials TVNZ 7 NCA - - 25.0 - n/a n/a ✓ Meet the Locals TVNZ 6 Factual - - 128.1 - n/a n/a ✓ ✓ ✓ Mickey Mouse Clubhouse TV2 Pre School - 25.5 25.5 25.5 727,240 18.2% ✓ Milly Molly TV2 Pre School 8.6 - 8.6 - 760,020 19.0% ✓ Minority Voice TVNZ 7 Factual - - 25.8 25.8 n/a n/a ✓ ✓ Minority Voices TV ONE SI 5.0 - 5.0 5.0 400,640 10.0% ✓ ✓ Moto GP 2010 TV ONE Sport 1.0 - 1.0 - 94,620 2.4% ✓ ✓ Motocross TV ONE Sport 1.4 - 1.4 - 268,400 6.7% ✓ ✓ Motorcycling TV ONE Sport 3.9 - 3.9 - 404,100 10.1% ✓ ✓ Motorway Patrol TV2 Factual 4.5 8.0 12.5 12.5 2,603,480 65.6% ✓ ✓ Mucking In TV ONE Factual 5.5 27.8 33.3 33.3 2,005,970 50.3% ✓ My Friends Tigger and Pooh TV2 Pre School 19.5 33.5 53.0 53.0 1,410,230 35.3% ✓ My God TVNZ 7 SI - - 2.5 2.5 n/a n/a ✓ ✓ My God TV ONE SI 4.5 - 4.5 4.5 417,420 10.4% ✓ ✓ My House My Castle TV2 Factual 4.0 - 4.0 4.0 2,045,900 51.5% ✓ National Bank Country Calendar TV ONE Factual 17.0 38.5 55.5 55.5 2,866,670 71.8% ✓ ✓ National Bank Young Farmer TVNZ 6 Factual - - 1.7 - n/a n/a ✓ ✓ National Bank Young Farmer TV ONE Factual 2.0 - 2.0 2.0 442,200 11.1% ✓ ✓ Netball - ANZ Champs TV ONE Sport 30.6 - 30.6 - 1,661,900 41.6% ✓ ✓ Netball - Aust Test/International Series TV ONE Sport 15.8 - 15.8 - 2,041,900 51.4% ✓ ✓ Netball - NZ/Aust v World/World Series TV ONE Sport 14.5 - 14.5 - 1,993,700 50.2% ✓ ✓ New Artland TVNZ 6 Arts - - 63.8 - n/a n/a ✓ ✓ ✓ ✓



24

No 2 TV ONE Drama - 1.8 1.8 1.8 546,400 13.8% ✓ ✓ ✓ No Opportunity Wasted TV2 Factual - 6.0 6.0 6.0 469,700 11.8% ✓ ✓ NZ Children’s Drama - various TVNZ 6 Ch Drama - - 133.5 39.6 n/a n/a ✓ ✓ NZ Documentaries - Various TVNZ 6 Doco - - 32.4 1.7 n/a n/a ✓ ✓ ✓ NZ Documentaries - Various TVNZ 7 Doco - - 27.5 - n/a n/a ✓ ✓ ✓ NZ Drama - various TVNZ 6 Drama 357.2 76.5 n/a n/a ✓ ✓ NZ Entertainment (incl. Comedy) - various TVNZ 6 Ent / Comedy - - 212.5 - n/a n/a ✓ ✓ NZ Factual - various TVNZ 6 Factual - - 389.5 82.4 n/a n/a ✓ ✓ ✓ NZ Festival of Motor Racing TV ONE Sport 2.4 - 2.4 - 250,120 6.2% ✓ ✓ NZ On A Plate 2 TV ONE Factual 6.1 5.5 11.6 11.6 1,662,050 41.7% ✓ ✓ NZ Pre School - various TVNZ 6 Pre School - - 1,803.6 443.9 n/a n/a ✓ NZ Smashes Guiness World Records TV2 Entertainment 6.5 - 6.5 6.5 2,112,570 53.2% ✓ ✓ NZ Up For Grabs TV ONE Doco - 0.1 0.1 0.1 51,230 1.3% ✓ ✓ ✓ Ocean Swim TV ONE Sport 1.8 - 1.8 - 299,840 7.5% ✓ ✓ Off the Radar TV ONE Factual - 6.5 6.5 6.5 624,150 15.7% ✓ ✓

One Decade in the Making TV ONE Doco 1.0 - 1.0 1.0 487,400 12.3% ✓ ✓ ✓ One Land TV ONE Factual 6.0 - 6.0 6.0 1,746,550 43.8% ✓ ✓ ✓ ONE News - Specials TV ONE NCA 5.5 - 5.5 4.0 1,079,570 27.0% ✓ ONE News at 4.30pm TV ONE NCA 118.5 - 118.5 - 2,519,310 63.2% ✓ ONE News at 6 TV ONE NCA 365.0 - 365.0 365.0 3,713,930 93.1% ✓ ONE News at Midday TV ONE NCA 118.5 - 118.5 118.5 2,281,840 57.2% ✓ ONE News Tonight TV ONE NCA 126.2 - 126.2 126.2 3,267,390 81.9% ✓ One Night Only TV2 Entertainment 6.0 - 6.0 6.0 1,689,820 42.4% ✓ ✓ ONES’s Countdown to New Year TV ONE Entertainment 1.5 - 1.5 1.5 453,290 11.4% ✓ ✓ Open Door TVNZ 7 Factual - - 83.3 - n/a n/a ✓ ✓ Orange Roughies TV ONE Drama 3.6 1.0 4.6 4.6 704,320 17.7% ✓ ✓ Our Heritage TV ONE Factual - 1.1 1.1 1.1 167,920 4.2% ✓ Our Lost War: Passchendaele TV ONE Doco - 0.6 0.6 0.6 71,930 1.8% ✓ ✓ ✓ Pacific Solutions: From Afghanistan to Aotearoa TV ONE Doco - 0.5 0.5 0.5 42,600 1.1% ✓ ✓ ✓ Paradise Cafe TV2 Children’s 6.5 6.5 13.0 13.0 1,117,940 28.0% ✓ ✓ Peter Pan TV ONE Arts - 1.6 1.6 1.8 46,930 1.2% ✓ ✓ ✓ Piece of My Heart TV ONE Drama - 1.8 1.8 21.1 806,370 20.3% ✓ ✓ ✓ Piha Rescue TV ONE Factual 5.0 13.0 18.0 18.0 2,734,280 68.5% ✓ ✓ Politically Incorrect Parenting TV ONE Factual 3.0 2.5 5.5 5.5 2,129,220 53.6% ✓ ✓ ✓ ✓

Powerbuilt Motorsport TV ONE Sport 22.1 - 22.1 - 2,304,190 58.1% ✓ ✓ Praise Be TVNZ 7 SI - - 67.5 - n/a n/a ✓ ✓ Praise Be TV ONE SI 21.5 0.5 22.0 - 927,110 23.3% ✓ ✓ Private Lives of … TV ONE Doco - 1.3 1.3 1.3 277,890 7.0% ✓ ✓ Puzzle Inc TV2 Pre School - 10.9 10.9 - 1,115,370 27.9% ✓ Q & A TVNZ 7 NCA - - 101.7 - n/a n/a ✓ Q & A TV ONE NCA 41.0 - 41.0 - 1,333,800 33.4% ✓ QTV TVNZ 6 Children’s - - 0.2 0.2 n/a n/a ✓ Racing For Possum TV ONE Doco - 0.1 0.1 0.1 39,810 1.0% ✓ ✓ Radar’s Patch TV ONE Factual 4.0 - 4.0 4.0 2,205,930 55.0% ✓ Rapid Response TV ONE Factual 1.0 4.5 5.5 5.5 1,493,580 37.3% ✓ ✓ Red Bull Air Race TV ONE Sport 5.5 - 5.5 - 483,490 12.2% ✓ ✓ Red Bull X-Fighters TV ONE Sport 4.0 - 4.0 - 411,140 10.4% ✓ ✓ Rescue One TV2 Factual 4.5 - 4.5 - 2,052,720 51.2% ✓ ✓ Reservoir Hill TV2 Drama 1.5 - 1.5 - 266,080 6.6% ✓ ✓ ✓

Road to the FIFA Cup TV ONE Sport 4.5 - 4.5 - 522,700 13.0% ✓ ✓ Roary The Racing Car TV2 Pre School - 17.3 17.3 - 994,470 24.9% ✓



25

No 2 TV ONE Drama - 1.8 1.8 1.8 546,400 13.8% ✓ ✓ ✓ No Opportunity Wasted TV2 Factual - 6.0 6.0 6.0 469,700 11.8% ✓ ✓ NZ Children’s Drama - various TVNZ 6 Ch Drama - - 133.5 39.6 n/a n/a ✓ ✓ NZ Documentaries - Various TVNZ 6 Doco - - 32.4 1.7 n/a n/a ✓ ✓ ✓ NZ Documentaries - Various TVNZ 7 Doco - - 27.5 - n/a n/a ✓ ✓ ✓ NZ Drama - various TVNZ 6 Drama 357.2 76.5 n/a n/a ✓ ✓ NZ Entertainment (incl. Comedy) - various TVNZ 6 Ent / Comedy - - 212.5 - n/a n/a ✓ ✓ NZ Factual - various TVNZ 6 Factual - - 389.5 82.4 n/a n/a ✓ ✓ ✓ NZ Festival of Motor Racing TV ONE Sport 2.4 - 2.4 - 250,120 6.2% ✓ ✓ NZ On A Plate 2 TV ONE Factual 6.1 5.5 11.6 11.6 1,662,050 41.7% ✓ ✓ NZ Pre School - various TVNZ 6 Pre School - - 1,803.6 443.9 n/a n/a ✓ NZ Smashes Guiness World Records TV2 Entertainment 6.5 - 6.5 6.5 2,112,570 53.2% ✓ ✓ NZ Up For Grabs TV ONE Doco - 0.1 0.1 0.1 51,230 1.3% ✓ ✓ ✓ Ocean Swim TV ONE Sport 1.8 - 1.8 - 299,840 7.5% ✓ ✓ Off the Radar TV ONE Factual - 6.5 6.5 6.5 624,150 15.7% ✓ ✓

One Decade in the Making TV ONE Doco 1.0 - 1.0 1.0 487,400 12.3% ✓ ✓ ✓ One Land TV ONE Factual 6.0 - 6.0 6.0 1,746,550 43.8% ✓ ✓ ✓ ONE News - Specials TV ONE NCA 5.5 - 5.5 4.0 1,079,570 27.0% ✓ ONE News at 4.30pm TV ONE NCA 118.5 - 118.5 - 2,519,310 63.2% ✓ ONE News at 6 TV ONE NCA 365.0 - 365.0 365.0 3,713,930 93.1% ✓ ONE News at Midday TV ONE NCA 118.5 - 118.5 118.5 2,281,840 57.2% ✓ ONE News Tonight TV ONE NCA 126.2 - 126.2 126.2 3,267,390 81.9% ✓ One Night Only TV2 Entertainment 6.0 - 6.0 6.0 1,689,820 42.4% ✓ ✓ ONES’s Countdown to New Year TV ONE Entertainment 1.5 - 1.5 1.5 453,290 11.4% ✓ ✓ Open Door TVNZ 7 Factual - - 83.3 - n/a n/a ✓ ✓ Orange Roughies TV ONE Drama 3.6 1.0 4.6 4.6 704,320 17.7% ✓ ✓ Our Heritage TV ONE Factual - 1.1 1.1 1.1 167,920 4.2% ✓ Our Lost War: Passchendaele TV ONE Doco - 0.6 0.6 0.6 71,930 1.8% ✓ ✓ ✓ Pacific Solutions: From Afghanistan to Aotearoa TV ONE Doco - 0.5 0.5 0.5 42,600 1.1% ✓ ✓ ✓ Paradise Cafe TV2 Children’s 6.5 6.5 13.0 13.0 1,117,940 28.0% ✓ ✓ Peter Pan TV ONE Arts - 1.6 1.6 1.8 46,930 1.2% ✓ ✓ ✓ Piece of My Heart TV ONE Drama - 1.8 1.8 21.1 806,370 20.3% ✓ ✓ ✓ Piha Rescue TV ONE Factual 5.0 13.0 18.0 18.0 2,734,280 68.5% ✓ ✓ Politically Incorrect Parenting TV ONE Factual 3.0 2.5 5.5 5.5 2,129,220 53.6% ✓ ✓ ✓ ✓

Powerbuilt Motorsport TV ONE Sport 22.1 - 22.1 - 2,304,190 58.1% ✓ ✓ Praise Be TVNZ 7 SI - - 67.5 - n/a n/a ✓ ✓ Praise Be TV ONE SI 21.5 0.5 22.0 - 927,110 23.3% ✓ ✓ Private Lives of … TV ONE Doco - 1.3 1.3 1.3 277,890 7.0% ✓ ✓ Puzzle Inc TV2 Pre School - 10.9 10.9 - 1,115,370 27.9% ✓ Q & A TVNZ 7 NCA - - 101.7 - n/a n/a ✓ Q & A TV ONE NCA 41.0 - 41.0 - 1,333,800 33.4% ✓ QTV TVNZ 6 Children’s - - 0.2 0.2 n/a n/a ✓ Racing For Possum TV ONE Doco - 0.1 0.1 0.1 39,810 1.0% ✓ ✓ Radar’s Patch TV ONE Factual 4.0 - 4.0 4.0 2,205,930 55.0% ✓ Rapid Response TV ONE Factual 1.0 4.5 5.5 5.5 1,493,580 37.3% ✓ ✓ Red Bull Air Race TV ONE Sport 5.5 - 5.5 - 483,490 12.2% ✓ ✓ Red Bull X-Fighters TV ONE Sport 4.0 - 4.0 - 411,140 10.4% ✓ ✓ Rescue One TV2 Factual 4.5 - 4.5 - 2,052,720 51.2% ✓ ✓ Reservoir Hill TV2 Drama 1.5 - 1.5 - 266,080 6.6% ✓ ✓ ✓

Road to the FIFA Cup TV ONE Sport 4.5 - 4.5 - 522,700 13.0% ✓ ✓ Roary The Racing Car TV2 Pre School - 17.3 17.3 - 994,470 24.9% ✓



26

Rowing TV ONE Sport 2.5 - 2.5 - 356,690 9.0% ✓ ✓ Rural Delivery TVNZ 7 SI - - 50.8 - n/a n/a ✓ ✓ Rural Delivery TV ONE SI 15.5 - 15.5 - 741,870 18.6% ✓ ✓ Rural Delivery: Pick of the Crop TVNZ 7 SI - - 32.5 - n/a n/a ✓ ✓ Sailing & Yachting TV ONE Sport 21.3 - 21.3 - 1,062,540 26.7% ✓ ✓ Save Our Home TV ONE Factual 5.0 - 5.0 5.0 1,905,230 48.0% ✓ ✓ ✓ School of Success TV ONE Doco - 3.0 3.0 3.0 339,750 8.5% ✓ ✓ Search and Rescue TV ONE Factual - 2.0 2.0 2.0 313,370 7.8% ✓ ✓ Shock Treatment TV2 Factual - 5.0 5.0 - 584,810 14.6% ✓ ✓ Shortland Street TVNZ 6 Drama - - 94.4 - n/a n/a ✓ ✓ Shortland Street TV2 Drama 126.5 240.1 366.6 366.6 3,511,520 88.0% ✓ ✓ Show of Hands TV ONE Drama - 1.9 1.9 1.9 635,780 16.0% ✓ ✓ Skoda Game On and Extra Time TV ONE Sport 12.3 - 12.3 - 900,130 22.4% ✓ ✓ Small Blacks TV TV2 Children’s 9.0 1.5 10.5 - 848,520 21.2% ✓ Snowboarding TV ONE Sport 1.0 - 1.0 - 206,960 5.2% ✓ ✓ Someone Somewhere Loves Me TV ONE Doco - 0.1 0.1 0.1 71,230 1.8% ✓ ✓ ✓ South TV ONE Factual 3.5 3.5 7.0 7.0 2,213,640 55.7% ✓ ✓ Speedway TV ONE Sport 6.4 - 6.4 - 772,300 19.3% ✓ ✓ Spotlight on the Economy: Back Benches TVNZ 7 NCA - - 5.0 - n/a n/a ✓ Spotlight on the Economy: Media 7 TVNZ 7 NCA - - 2.5 - n/a n/a ✓ Spotlight on the Economy: National’s... TVNZ 7 NCA - - 5.0 - n/a n/a ✓ Spotlight on the Economy: Recession... TVNZ 7 NCA - - 10.0 - n/a n/a ✓ Staines Down Drains TV2 Children’s - 10.8 10.8 10.8 495,410 12.4% ✓ Studio 2 TV2 Children’s 63.0 - 63.0 - 2,007,680 50.4% ✓ Style Pasifika TV ONE Arts 1.0 1.0 2.0 - 402,330 10.1% ✓ ✓ ✓ Sunday TV ONE NCA 44.0 33.9 77.9 77.9 3,183,450 79.8% ✓ Tagata Pasifika TVNZ 7 SI - - 85.4 - n/a n/a ✓ ✓ Tagata Pasifika TV ONE SI 25.2 25.5 50.7 - 2,130,070 53.4% ✓ ✓ Tales from Te Papa TVNZ 6 Factual - - 102.5 - n/a n/a ✓ ✓ Talk Talk TVNZ 6 Arts - - 60.0 - n/a n/a ✓ ✓ ✓ Taste New Zealand TV ONE Factual - 13.0 13.0 13.0 821,530 20.6% ✓ ✓ Taste Takes Off TVONE Factual - 3.2 3.2 3.2 452,110 11.3% ✓ Te Karere TVNZ 7 SI - - 211.2 158.5 n/a n/a ✓ ✓ ✓ ✓ Te Karere TV ONE SI 127.9 22.5 150.4 150.4 2,434,480 61.0% ✓ ✓ ✓ ✓ Te Wiki O Te Karere TVNZ 7 NCA - - 82.5 - n/a n/a ✓ ✓ ✓ ✓ Tennis - Wimbledon TVNZ 7 Sport - - 7.5 - n/a n/a ✓ ✓ Tennis - Wimbledon Highlights TV2 Sport 9.0 - 9.0 - 741,550 18.5% ✓ ✓ Tennis TV ONE Sport 90.7 90.7 - 2,088,100 52.2% ✓ ✓ The Ad Show TVNZ 7 Factual - - 44.6 - n/a n/a ✓ The Apprentice NZ TV2 Entertainment 13.0 - 13.0 13.0 2,354,240 58.7% ✓ ✓ The Cheap Life TVNZ 6 Factual - - 10.0 - n/a n/a ✓ The Cult TV2 Drama 13.0 13.0 26.0 26.0 2,656,740 66.9% ✓ ✓ ✓

The Good Word TVNZ 6 Arts - - 71.3 - n/a n/a ✓ ✓ ✓ The Gravy TVNZ 6 Arts - - 42.5 - n/a n/a ✓ ✓ ✓ The Inspectors TV ONE Factual 5.0 - 5.0 5.0 2,133,090 53.2% ✓ ✓ The Investigator TV ONE Doco 4.0 - 4.0 4.0 1,369,050 34.5% ✓ ✓ ✓ The Killing of Sophie Elliott TV ONE Doco 1.0 - 1.0 1.0 689,980 17.4% ✓ ✓ ✓ The Kiwi Who Saved Britain TVNZ 6 Doco - - 1.7 1.7 n/a n/a ✓ ✓ The Kiwi Who Saved Britain TV ONE Doco 1.0 - 1.0 1.0 642,120 16.0% ✓ ✓ The Mighty Pride TV ONE Doco - 1.0 1.0 - 108,570 2.7% ✓ ✓ The Missing TV ONE Doco 8.0 - 8.0 8.0 2,007,780 50.6% ✓ ✓ ✓



27

Rowing TV ONE Sport 2.5 - 2.5 - 356,690 9.0% ✓ ✓ Rural Delivery TVNZ 7 SI - - 50.8 - n/a n/a ✓ ✓ Rural Delivery TV ONE SI 15.5 - 15.5 - 741,870 18.6% ✓ ✓ Rural Delivery: Pick of the Crop TVNZ 7 SI - - 32.5 - n/a n/a ✓ ✓ Sailing & Yachting TV ONE Sport 21.3 - 21.3 - 1,062,540 26.7% ✓ ✓ Save Our Home TV ONE Factual 5.0 - 5.0 5.0 1,905,230 48.0% ✓ ✓ ✓ School of Success TV ONE Doco - 3.0 3.0 3.0 339,750 8.5% ✓ ✓ Search and Rescue TV ONE Factual - 2.0 2.0 2.0 313,370 7.8% ✓ ✓ Shock Treatment TV2 Factual - 5.0 5.0 - 584,810 14.6% ✓ ✓ Shortland Street TVNZ 6 Drama - - 94.4 - n/a n/a ✓ ✓ Shortland Street TV2 Drama 126.5 240.1 366.6 366.6 3,511,520 88.0% ✓ ✓ Show of Hands TV ONE Drama - 1.9 1.9 1.9 635,780 16.0% ✓ ✓ Skoda Game On and Extra Time TV ONE Sport 12.3 - 12.3 - 900,130 22.4% ✓ ✓ Small Blacks TV TV2 Children’s 9.0 1.5 10.5 - 848,520 21.2% ✓ Snowboarding TV ONE Sport 1.0 - 1.0 - 206,960 5.2% ✓ ✓ Someone Somewhere Loves Me TV ONE Doco - 0.1 0.1 0.1 71,230 1.8% ✓ ✓ ✓ South TV ONE Factual 3.5 3.5 7.0 7.0 2,213,640 55.7% ✓ ✓ Speedway TV ONE Sport 6.4 - 6.4 - 772,300 19.3% ✓ ✓ Spotlight on the Economy: Back Benches TVNZ 7 NCA - - 5.0 - n/a n/a ✓ Spotlight on the Economy: Media 7 TVNZ 7 NCA - - 2.5 - n/a n/a ✓ Spotlight on the Economy: National’s... TVNZ 7 NCA - - 5.0 - n/a n/a ✓ Spotlight on the Economy: Recession... TVNZ 7 NCA - - 10.0 - n/a n/a ✓ Staines Down Drains TV2 Children’s - 10.8 10.8 10.8 495,410 12.4% ✓ Studio 2 TV2 Children’s 63.0 - 63.0 - 2,007,680 50.4% ✓ Style Pasifika TV ONE Arts 1.0 1.0 2.0 - 402,330 10.1% ✓ ✓ ✓ Sunday TV ONE NCA 44.0 33.9 77.9 77.9 3,183,450 79.8% ✓ Tagata Pasifika TVNZ 7 SI - - 85.4 - n/a n/a ✓ ✓ Tagata Pasifika TV ONE SI 25.2 25.5 50.7 - 2,130,070 53.4% ✓ ✓ Tales from Te Papa TVNZ 6 Factual - - 102.5 - n/a n/a ✓ ✓ Talk Talk TVNZ 6 Arts - - 60.0 - n/a n/a ✓ ✓ ✓ Taste New Zealand TV ONE Factual - 13.0 13.0 13.0 821,530 20.6% ✓ ✓ Taste Takes Off TVONE Factual - 3.2 3.2 3.2 452,110 11.3% ✓ Te Karere TVNZ 7 SI - - 211.2 158.5 n/a n/a ✓ ✓ ✓ ✓ Te Karere TV ONE SI 127.9 22.5 150.4 150.4 2,434,480 61.0% ✓ ✓ ✓ ✓ Te Wiki O Te Karere TVNZ 7 NCA - - 82.5 - n/a n/a ✓ ✓ ✓ ✓ Tennis - Wimbledon TVNZ 7 Sport - - 7.5 - n/a n/a ✓ ✓ Tennis - Wimbledon Highlights TV2 Sport 9.0 - 9.0 - 741,550 18.5% ✓ ✓ Tennis TV ONE Sport 90.7 90.7 - 2,088,100 52.2% ✓ ✓ The Ad Show TVNZ 7 Factual - - 44.6 - n/a n/a ✓ The Apprentice NZ TV2 Entertainment 13.0 - 13.0 13.0 2,354,240 58.7% ✓ ✓ The Cheap Life TVNZ 6 Factual - - 10.0 - n/a n/a ✓ The Cult TV2 Drama 13.0 13.0 26.0 26.0 2,656,740 66.9% ✓ ✓ ✓

The Good Word TVNZ 6 Arts - - 71.3 - n/a n/a ✓ ✓ ✓ The Gravy TVNZ 6 Arts - - 42.5 - n/a n/a ✓ ✓ ✓ The Inspectors TV ONE Factual 5.0 - 5.0 5.0 2,133,090 53.2% ✓ ✓ The Investigator TV ONE Doco 4.0 - 4.0 4.0 1,369,050 34.5% ✓ ✓ ✓ The Killing of Sophie Elliott TV ONE Doco 1.0 - 1.0 1.0 689,980 17.4% ✓ ✓ ✓ The Kiwi Who Saved Britain TVNZ 6 Doco - - 1.7 1.7 n/a n/a ✓ ✓ The Kiwi Who Saved Britain TV ONE Doco 1.0 - 1.0 1.0 642,120 16.0% ✓ ✓ The Mighty Pride TV ONE Doco - 1.0 1.0 - 108,570 2.7% ✓ ✓ The Missing TV ONE Doco 8.0 - 8.0 8.0 2,007,780 50.6% ✓ ✓ ✓



28

The Nuclear Comeback TV ONE Doco - 0.3 0.3 0.3 94,520 2.4% ✓ ✓ ✓ The Nutcracker TVNZ 6 Arts - - 1.4 1.4 n/a n/a ✓ ✓ The Other Olympiad TV ONE Doco - 0.8 0.8 0.8 99,330 2.5% ✓ ✓ ✓ The Pretender TV ONE Comedy - 0.3 0.3 0.3 93,650 2.4% ✓ ✓ ✓

The Real Mr Asia TV ONE Doco - 0.6 0.6 0.6 100,280 2.5% ✓ ✓ ✓ The Singing Bee TV2 Entertainment 4.0 5.9 9.9 9.9 1,699,210 42.5% ✓ ✓ The Sitting TVNZ 6 Arts - - 31.9 - n/a n/a ✓ ✓ ✓

The Truth About Us TV ONE Doco 1.0 - 1.0 1.0 541,060 13.5% ✓ ✓ ✓ The Worst Offenders TV ONE Doco 1.0 - 1.0 1.0 748,420 18.7% ✓ ✓ ✓ The Worst That Could Happen TV ONE Doco 1.0 - 1.0 1.0 674,020 17.0% ✓ ✓ The Zoo TV ONE Factual 5.5 9.5 15.0 15.0 2,191,140 54.8% ✓ ✓ The Zoo - This Is Your Life TV ONE Factual 1.5 - 1.5 1.5 1,217,030 30.3% ✓ ✓ Time Trackers TV2 Children’s - 6.5 6.5 - 769,980 19.2% ✓ ✓ To Sir With Love TV ONE Entertainment - 2.0 2.0 2.0 890,940 22.4% ✓ ✓ ✓ Treasure Island:Couples At War TV2 Entertainment - 12.5 12.5 12.5 777,790 19.6% ✓ Treasure Island:The Pirates of the Pacific TV2 Entertainment - 14.5 14.5 14.5 963,180 24.0% ✓ Tri TV - Contact TV ONE Sport 14.5 - 14.5 - 1,129,130 28.4% ✓ ✓ Tri TV - ITU World Champs TV ONE Sport 3.5 - 3.5 - 303,440 7.6% ✓ ✓ TVNZ News at 8 TVNZ 7 NCA - - 365.0 - n/a n/a ✓ TVNZ News Now TVNZ 7 NCA - - 1,645.7 - n/a n/a ✓ TVNZ News Specials TVNZ 7 NCA - - 4.0 - n/a n/a ✓ Two Women & A Baby TV ONE Doco - 0.5 0.5 0.5 99,960 2.5% ✓ Under Investigation Medical Mysteries TV ONE Doco - 0.3 0.3 0.3 206,610 5.2% ✓ Undercover TV ONE Doco - 3.3 3.3 3.3 1,376,030 34.7% ✓ Until Proven Innocent TV ONE Drama - 1.8 1.8 1.8 845,870 21.3% ✓ ✓ ✓ Use As Directed TVNZ 7 Factual - - 47.8 - n/a n/a ✓ Vietnam: My Father’s War TV ONE Doco - 0.6 0.6 0.6 95,040 2.4% ✓ ✓ ✓ Vodafone One Tribe TV TV2 Sport 5.0 - 5.0 - 609,920 15.4% ✓ Volunteer Power TVNZ 6 Factual - - 6.8 - n/a n/a ✓ ✓ Waka Huia TVNZ 7 SI - - 82.5 82.5 n/a n/a ✓ ✓ ✓ Waka Huia TV ONE SI 38.0 38.0 38.0 1,030,950 25.9% ✓ ✓ ✓ Waka Huia: He Hokinga Mai TVNZ 7 SI - - 210.0 - n/a n/a ✓ ✓ ✓ Waybuloo TV2 Pre School 22.6 - 22.6 22.6 793,230 19.8% ✓ Whanau TVNZ 6 SI - - 12.8 12.8 n/a n/a ✓ ✓ ✓ ✓ What Now Sundays TV2 Children’s 78.0 4.0 82.0 - 1,759,750 44.1% ✓ Who Dares Wins TV2 Entertainment - 2.0 2.0 2.0 679,610 16.9% ✓ ✓ Wicked Weather TV ONE Doco - 2.9 2.9 2.9 341,490 8.5% ✓ ✓ ✓ Wild Vets TV ONE Factual 5.5 - 5.5 5.5 2,108,260 52.9% ✓ Wonder Dogs TV ONE Entertainment - 0.5 0.5 0.5 82,540 2.1% ✓ ✓ World’s Fastest Indian: The Burt Munro Story TV ONE Doco - 0.7 0.7 0.7 86,400 2.2% ✓ ✓ Wot Wots TV2 Pre School 1.0 18.5 19.5 19.5 927,020 23.3% ✓ Yo Gabba Gabba TV2 Pre School 10.0 26.5 36.5 36.5 1,014,260 25.5% ✓ Your Money Sorted TV ONE Factual - 3.9 3.9 3.9 615,220 15.4% ✓ ✓ Zip & Mac’s Pad TV2 Pre School - 4.4 4.4 4.4 768,100 19.3% ✓ ✓

Total 14,672.2 4,007.1



29

The Nuclear Comeback TV ONE Doco - 0.3 0.3 0.3 94,520 2.4% ✓ ✓ ✓ The Nutcracker TVNZ 6 Arts - - 1.4 1.4 n/a n/a ✓ ✓ The Other Olympiad TV ONE Doco - 0.8 0.8 0.8 99,330 2.5% ✓ ✓ ✓ The Pretender TV ONE Comedy - 0.3 0.3 0.3 93,650 2.4% ✓ ✓ ✓

The Real Mr Asia TV ONE Doco - 0.6 0.6 0.6 100,280 2.5% ✓ ✓ ✓ The Singing Bee TV2 Entertainment 4.0 5.9 9.9 9.9 1,699,210 42.5% ✓ ✓ The Sitting TVNZ 6 Arts - - 31.9 - n/a n/a ✓ ✓ ✓

The Truth About Us TV ONE Doco 1.0 - 1.0 1.0 541,060 13.5% ✓ ✓ ✓ The Worst Offenders TV ONE Doco 1.0 - 1.0 1.0 748,420 18.7% ✓ ✓ ✓ The Worst That Could Happen TV ONE Doco 1.0 - 1.0 1.0 674,020 17.0% ✓ ✓ The Zoo TV ONE Factual 5.5 9.5 15.0 15.0 2,191,140 54.8% ✓ ✓ The Zoo - This Is Your Life TV ONE Factual 1.5 - 1.5 1.5 1,217,030 30.3% ✓ ✓ Time Trackers TV2 Children’s - 6.5 6.5 - 769,980 19.2% ✓ ✓ To Sir With Love TV ONE Entertainment - 2.0 2.0 2.0 890,940 22.4% ✓ ✓ ✓ Treasure Island:Couples At War TV2 Entertainment - 12.5 12.5 12.5 777,790 19.6% ✓ Treasure Island:The Pirates of the Pacific TV2 Entertainment - 14.5 14.5 14.5 963,180 24.0% ✓ Tri TV - Contact TV ONE Sport 14.5 - 14.5 - 1,129,130 28.4% ✓ ✓ Tri TV - ITU World Champs TV ONE Sport 3.5 - 3.5 - 303,440 7.6% ✓ ✓ TVNZ News at 8 TVNZ 7 NCA - - 365.0 - n/a n/a ✓ TVNZ News Now TVNZ 7 NCA - - 1,645.7 - n/a n/a ✓ TVNZ News Specials TVNZ 7 NCA - - 4.0 - n/a n/a ✓ Two Women & A Baby TV ONE Doco - 0.5 0.5 0.5 99,960 2.5% ✓ Under Investigation Medical Mysteries TV ONE Doco - 0.3 0.3 0.3 206,610 5.2% ✓ Undercover TV ONE Doco - 3.3 3.3 3.3 1,376,030 34.7% ✓ Until Proven Innocent TV ONE Drama - 1.8 1.8 1.8 845,870 21.3% ✓ ✓ ✓ Use As Directed TVNZ 7 Factual - - 47.8 - n/a n/a ✓ Vietnam: My Father’s War TV ONE Doco - 0.6 0.6 0.6 95,040 2.4% ✓ ✓ ✓ Vodafone One Tribe TV TV2 Sport 5.0 - 5.0 - 609,920 15.4% ✓ Volunteer Power TVNZ 6 Factual - - 6.8 - n/a n/a ✓ ✓ Waka Huia TVNZ 7 SI - - 82.5 82.5 n/a n/a ✓ ✓ ✓ Waka Huia TV ONE SI 38.0 38.0 38.0 1,030,950 25.9% ✓ ✓ ✓ Waka Huia: He Hokinga Mai TVNZ 7 SI - - 210.0 - n/a n/a ✓ ✓ ✓ Waybuloo TV2 Pre School 22.6 - 22.6 22.6 793,230 19.8% ✓ Whanau TVNZ 6 SI - - 12.8 12.8 n/a n/a ✓ ✓ ✓ ✓ What Now Sundays TV2 Children’s 78.0 4.0 82.0 - 1,759,750 44.1% ✓ Who Dares Wins TV2 Entertainment - 2.0 2.0 2.0 679,610 16.9% ✓ ✓ Wicked Weather TV ONE Doco - 2.9 2.9 2.9 341,490 8.5% ✓ ✓ ✓ Wild Vets TV ONE Factual 5.5 - 5.5 5.5 2,108,260 52.9% ✓ Wonder Dogs TV ONE Entertainment - 0.5 0.5 0.5 82,540 2.1% ✓ ✓ World’s Fastest Indian: The Burt Munro Story TV ONE Doco - 0.7 0.7 0.7 86,400 2.2% ✓ ✓ Wot Wots TV2 Pre School 1.0 18.5 19.5 19.5 927,020 23.3% ✓ Yo Gabba Gabba TV2 Pre School 10.0 26.5 36.5 36.5 1,014,260 25.5% ✓ Your Money Sorted TV ONE Factual - 3.9 3.9 3.9 615,220 15.4% ✓ ✓ Zip & Mac’s Pad TV2 Pre School - 4.4 4.4 4.4 768,100 19.3% ✓ ✓

Total 14,672.2 4,007.1



30

31 Statement of Responsibility

32 Income Statement

33 Statement of Comprehensive Income

34 Statement of Changes in Equity

35 Statement of Financial Position

36 Statement of Cash Flows

37 Notes to the Financial Statements

64 Statement of Service Performance

74 Report of the Auditor General

76 Five Year Trend Statement

77 Additional Information

FINANCIAL STATEMENTS


31

STATEMENT OF RESPONSIBILITYFOR THE YEAR ENDED 30 JUNE 2010

The Board and management of Television New Zealand Limited are responsible for:

• Thepreparationofthesefinancialstatementsandthejudgementsusedinthem.

• Establishingandmaintainingasystemofinternalcontroldesignedtoprovidereasonableassuranceastotheintegrityandreliabilityof financial reporting.

In the opinion of the Board and management these financial statements fairly reflect the financial position of Television New Zealand Limited as at 30 June 2010 and its financial performance and cash flows for the year ended that date.

The directors have pleasure in presenting the following financial statements for the year ended 30 June 2010.

For and on behalf of the Board of Directors

Sir John Anderson, KBE Sir John Goulter, KNZM, JP Chairman Chairman, Audit and Risk Committee

30 September 2010


32

INCOME STATEMENTFOR THE YEAR ENDED 30 JUNE 2010

Group Company

2010 2009 2010 2009

Notes $000 $000 $000 $000

Revenue

Operating revenue 4 313,669 333,213 313,669 333,213

Government funding 19a 41,460 51,234 41,460 51,234

(MCH, NZ On Air, Te Mangai Paho)

Interest income 208 314 208 314

Gain on sale of property, plant and equipment 0 25 0 25

355,337 384,786 355,337 384,786

Expenses

Programme amortisation 13 (205,650) (231,589) (205,650) (231,589)

Employee benefits 5 (61,735) (64,929) (61,735) (64,929)

Depreciation and amortisation 5 (18,570) (16,947) (18,570) (16,947)

Transmission (21,608) (21,564) (21,608) (21,564)

Marketing (11,714) (13,646) (11,714) (13,646)

Other (23,076) (25,970) (23,076) (25,970)

(342,353) (374,645) (342,353) (374,645)

Earnings before reorganisation cost, programme amortisation revision, interest, financial instruments, associate and tax

12,984 10,141 12,984 10,141

Programme amortisation revision (net) 6 (26,849) 0 (26,849) 0

Reorganisation costs 7 (944) (3,729) (944) (3,729)

Interest expense (2,948) (2,173) (2,948) (2,173)

Financial instruments/foreign currency gains 8 1,154 376 1,079 324

Share of results of associated company 15 94 (1,011) 0 0

Profit/(loss) before income tax (16,509) 3,604 (16,678) 4,563

Income tax benefit/(expense) 9 4,673 (1,502) 4,659 (1,486)

Effect of change in income tax legislation 9 (14,190) 0 (14,190) 0

Profit/(loss) for the year (26,026) 2,102 (26,209) 3,077

The accompanying notes form part of these financial statements.


33

STATEMENT OF COMPREHENSIVE INCOMEFOR THE YEAR ENDED 30 JUNE 2010

Group Company

2010 2009 2010 2009

Notes $000 $000 $000 $000

Profit/(loss) for the year (26,026) 2,102 (26,209) 3,077

Other comprehensive income/(loss)

Net changes in the fair value of cash flow hedges (485) 144 (485) 144

Income tax on other comprehensive income 146 (43) 146 (43)

Other comprehensive income/(loss) for the year net of income tax (339) 101 (339) 101

Total comprehensive income/(loss) for the year (26,365) 2,203 (26,548) 3,178



34

STATEMENT OF CHANGES IN EqUITYFOR THE YEAR ENDED 30 JUNE 2010

Share

Capital

Cash flow hedge reserve

Retained earnings

Total

Notes $000 $000 $000 $000

GroupAt 1 July 2009 140,000 84 44,808 184,892

Profit/(loss) for the period 0 0 (26,026) (26,026)

Other comprehensive income 0 (339) 0 (339)

Total comprehensive income/(loss) for the period 0 (339) (26,026) (26,365)

Equity transactions

Dividend paid in the year 0 0 (1,472) (1,472)

At 30 June 2010 140,000 (255) 17,310 157,055

At 1 July 2008 140,000 (17) 42,706 182,689

Profit/(loss) for the period 0 0 2,102 2,102

Other comprehensive income 0 101 0 101

Total comprehensive income for the period 0 101 2,102 2,203

Equity transactions

Dividend paid in the year 0 0 0 0

At 30 June 2009 140,000 84 44,808 184,892

CompanyAt 1 July 2009 140,000 84 45,845 185,929

Profit/(loss) for the period 0 0 (26,209) (26,209)

Other comprehensive income 0 (339) 0 (339)

Total comprehensive income/(loss) 0 (339) (26,209) (26,548)

Equity transactions

Dividend paid in the year 0 0 (1,472) (1,472)

At 30 June 2010 140,000 (255) 18,164 157,909

At 1 July 2008 140,000 (17) 42,768 182,751

Profit/(loss) for the period 0 0 3,077 3,077

Other comprehensive income 0 101 0 101

Total comprehensive income 0 101 3,077 3,178

Equity transactions

Dividend paid in the year 0 0 0 0

At 30 June 2009 140,000 84 45,845 185,929



35

Group Company

2010 2009 2010 2009

Notes $000 $000 $000 $000

ASSETS

Current Assets

Cash and cash equivalents 10 1,154 2,047 1,154 2,047

Receivables and prepayments 11 55,688 64,552 55,713 64,568

Programme rights - intangible assets 13 47,076 64,463 47,076 64,463

Inventories 223 229 223 229

Derivative financial instruments 22 1,354 3,527 1,354 3,527

Total current assets 105,495 134,818 105,520 134,834

Non-current assets

Property, plant and equipment 12 114,324 107,395 114,324 107,395

Other intangible assets 13 23,279 20,983 23,279 20,983

Programme rights - intangible assets 13 0 17,718 0 17,718

Deferred tax asset 9 2,056 11,233 2,054 11,200

Derivative financial instruments 22 9 851 9 851

Investment in subsidiaries 14 0 0 10,248 5,210

Investment in associate 15 9,417 9,151 0 0

Loan to associate 4,067 2,197 4,067 2,197

Other investments 42 42 42 42

Total non-current assets 153,194 169,570 154,023 165,596

Total assets 258,689 304,388 259,543 300,430

LIABILITIES

Current Liabilities

Loans and borrowings 17 159 36,221 159 36,221

Trade and other payables 18 43,783 51,960 43,783 46,965

Deferred income 19 17,832 26,939 17,832 26,939


Provisions 20 893 1,798 893 1,798

Total current liabilities 63,243 117,171 63,243 112,176

Non-current liabilities

Employee entitlements 18 1,789 2,047 1,789 2,047


Provisions 20 0 278 0 278

Loans and borrowings 17 36,600 0 36,600 0

Total non-current liabilities 38,391 2,325 38,391 2,325

Equity

Share capital 23 140,000 140,000 140,000 140,000

Cash flow hedge reserves (255) 84 (255) 84

Retained earnings 17,310 44,808 18,164 45,845

Total equity 157,055 184,892 157,909 185,929

Total equity and liabilities 258,689 304,388 259,543 300,430

The accompanying notes form part of these financial statements. For and on behalf of the Board, who authorise the issue of these financial statements on 30 September 2010

Sir John Anderson, KBE Sir John Goulter, KNZM, JP Chairman Director

STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2010


36

Group Company

2010 2009 2010 2009

Notes $000 $000 $000 $000

Cash flows from/(used in) operating activities

Receipts from customers 311,972 334,245 312,422 334,245

Receipt of government grants 34,618 44,239 34,168 44,239

Interest received 38 315 38 315

Income tax received 1,843 0 1,789 0

Payments to suppliers and employees (310,754) (347,408) (310,827) (347,460)

Interest paid (2,912) (2,163) (2,912) (2,163)

Income tax paid 0 (1,850) 0 (1,897)

Net cash flows from/(used in) operating activities 24 34,805 27,378 34,678 27,279

Cash flows from/(used in) investing activities

Proceeds from sale of property, plant and equipment 37 35 37 35

Loans repaid by subsidiaries 0 0 0 45

Purchase of property, plant and equipment (20,591) (11,566) (20,591) (11,566)

Purchase of intangibles (7,254) (9,487) (7,254) (9,487)

Loan to subsidiary 0 0 (4,866) (4,937)

Investment in and advances to associates (6,865) (7,366) (1,872) (2,375)

Net cash flows from/(used in) investing activities (34,673) (28,384) (34,546) (28,285)

Cash flows from/(used in) financing activities

Drawdown of borrowings 52,400 8,350 52,400 8,350

Repayment of borrowings (51,850) 0 (51,850) 0

Dividends paid (1,472) (10,301) (1,472) (10,301)

Net cash flows from/(used in) financing activities (922) (1,951) (922) (1,951)

Net increase/(decrease) in cash and cash equivalents (790) (2,957) (790) (2,957)

Net foreign exchange differences (91) 59 (91) 59

Cash and cash equivalents at the beginning of the period 1,876 4,774 1,876 4,774

Cash and cash equivalents at the end of the period 10 995 1,876 995 1,876


STATEMENTS OF CASH FLOWSFOR THE YEAR ENDED 30 JUNE 2010


37

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

1. Corporate informationTelevision New Zealand Limited (the “Company”) and its subsidiaries (the “Group’) operate as a multi channel television and digital media broadcasting and production company in New Zealand.

The Company is a limited liability company incorporated in New Zealand under the Companies Act 1993 and is wholly owned by the Crown. The Company is bound by the requirements of the Television New Zealand Act 2003. The Crown does not guarantee the liabilities of Television New Zealand Limited in any way.

These consolidated financial statements were approved for issue by the Board of Directors on 30 September 2010.

2. Summary of significant accounting policiesThe principal accounting policies adopted in the preparation of the financial statements are set out below. These policies have been consistently applied to all periods presented, unless otherwise stated.

a) Basis of preparationThe financial statements have been prepared in accordance with generally accepted accounting practice in New Zealand (NZ GAAP) and the requirements of the Television New Zealand Act 2003, Financial Reporting Act 1993 and the Companies Act 1993. The financial statements have been prepared on a historical cost basis except for derivative financial instruments that have been measured at fair value.

The carrying values of recognised assets and liabilities that are hedged are adjusted to record changes in the fair values attributable to the risks that are being hedged.

The financial statements are presented in New Zealand dollars ($), which is the Company’s functional currency. All financial information presented in New Zealand dollars has been rounded to the nearest thousand unless otherwise stated.

b) Statement of complianceThe financial statements have been prepared in accordance with NZ GAAP. They comply with New Zealand equivalents to International Financial Reporting Standards (NZ IFRS), and other applicable Financial Reporting Standards, as appropriate for profit orientated entities. The financial statements comply with International Financial Reporting Standards (IFRS).

The accounting policies set out below have been applied consistently to all periods presented in these financial statements, unless otherwise stated.

c) Changes in accounting policies and disclosuresi) New and amended standards adopted by the GroupThe Group has adopted the following new and amended NZ IFRS’s and interpretations as of 1 July 2009.

NZ IFRS 7 - Financial instruments: DisclosuresThe amended standard requires additional disclosures about fair value measurement and liquidity risk. The amendment requires fair value measurements to be disclosed by source of inputs using a three level hierarchy. As the change in accounting policy only results in additional disclosures there is no impact on earnings.

NZ IAS 1- Presentation of financial statements (revised)The revised standard separates owner and non-owner changes in equity. The statement of changes in equity includes only details of transactions with the owner, non-owner changes in equity are presented separately in a new statement of comprehensive income. The statement of comprehensive income presents all items of recognised income and expense, either in one single statement, or in two linked statements. The Group has elected to present two statements: an income statement and a statement of comprehensive income. The amendments only affect the presentation of the Group’s financial statements and do not have a direct impact on the measurement and recognition of amounts under the previous NZ IAS 1.

NZ IAS 23 - Borrowing costs (revised)The revised NZ IAS 23 requires that all borrowing costs associated with a qualifying asset must be capitalised. The Group’s previous policy was to expense borrowing costs as they were incurred. In accordance with the transitional provisions of the revised NZ IAS 23, the Group has adopted the standard on a prospective basis. Therefore borrowing costs are capitalised on qualifying assets with a commencement date on or after 1 July 2009. The Group did not capitalise any borrowing costs in the current year.

NZ IAS 24 - Related Party Disclosures (revised)The revised NZ IAS 24 simplifies the definition of a related party and provides a partial exemption from the disclosure of government related entities. The changes are disclosure only and the Group has chosen to early adopt this standard.


38

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)FOR THE YEAR ENDED 30 JUNE 2010

Amendments to NZ IFRS 1 and NZ IAS 27 – Cost of an investment in a subsidiary, jointly controlled entity or associateThe amendments delete the reference to the “cost method” making the distinction between pre and post acquisition profits no longer relevant. All dividends received are now recognised in the income statement. On receipt of such dividends the entity is now required to consider if there is an indicator of impairment in that investment. No dividends were received in the current financial year.

ii) Accounting standards and interpretations issued but not yet effectiveStandards and Interpretations that have recently been issued or amended but are not yet effective have not been adopted by the Group for the annual reporting period ending 30 June 2010. These are noted below.

NZ IFRS 9 – Financial InstrumentsThis standard is part of a wider project to replace NZ IAS 39 Financial Instruments: Recognition and Measurement.

The standard establishes two primary measurement categories for financial assets: amortised cost and fair value. The basis of classification will depend on the Group’s business model for managing the financial asset and contractual cash flow characteristics of the financial asset. The Group has not yet assessed the impact of this standard. The application date for this standard is for accounting periods beginning on or after 1 January 2013, the application date for the Group is 1 July 2013.

d) Basis of consolidationThe consolidated financial statements comprise the financial statements of Television New Zealand Limited and its subsidiaries at 30 June.

Subsidiaries are those entities controlled, directly or indirectly, by the Group. The financial statements of subsidiaries are prepared for the same reporting period as the parent company, using consistent accounting policies. Adjustments are made to bring into line any dissimilar accounting policies that may exist. All intercompany transactions, balances and unrealised surpluses and deficits on transactions between Group companies are eliminated on consolidation.

The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.

The acquisition of subsidiaries is accounted for using the acquisition method of accounting.

Investments in subsidiaries are accounted for at cost, less allowance for impairment, in the separate financial statements of the Company.

e) Foreign currencyThe functional and presentational currency of Television New Zealand Limited and its subsidiaries is the New Zealand dollar ($).

Transactions in foreign currencies are translated to the functional currency at the exchange rates ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the exchange rates ruling at balance date.

Foreign currency differences arising on the translation of monetary assets and liabilities in foreign currencies are recognised in the income statement.

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rate as at the date of the initial transaction.

f) Revenue recognitionRevenue is stated exclusive of goods and services tax (GST) and consists of sales of goods and services to third parties. Revenue from the sale of goods and services is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Key classes of revenue are recognised on the following basis:

i) Rendering of servicesRevenue from advertising and sponsorship is recognised as income at the time of transmission.

ii) Government grants Government grants are recognised initially as deferred income when there is reasonable assurance that they will be received and that the Group will comply with the conditions associated with the grant. Grants that compensate the Group for expenses incurred are recognised as income on a systematic basis in the same periods in which the expenses are recognised. Grants that compensate the Group for the cost of an asset are recognised as income in the income statement on a systematic basis over the useful life of the asset.


39


iii) Other revenueOther revenue is recognised when the product has been delivered or in the accounting period in which the actual service has been provided.

iv) InterestInterest revenue is recognised as the interest accrues to the net carrying amount of the financial asset.

g) Income tax expenseIncome tax expense comprises current and deferred tax. Income tax expense is recognised in the income statement except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity.

Deferred tax is recognised using the balance sheet method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes, and the amounts used for taxation purposes.

Deferred tax assets are recognised where realisation of the asset is probable.

Deferred tax is measured at the tax rates that are expected to apply when the temporary differences reverse, based on tax rates (and tax law) that have been enacted or substantively enacted at the balance sheet date.

Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set off current tax assets against current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and the same taxation authority.

h) LeasesOperating lease payments, where the lessors substantially retain all the risks and benefits of ownership of the leased items, are recognised as an expense in the income statement on a straight-line basis over the lease term.

i) DividendsProvision is made for the amount of dividend declared on or before balance date but not distributed at balance date.

j) Property, plant and equipmentItems of property, plant and equipment are stated at cost less accumulated depreciation and impairment losses. Cost includes the cost to acquire the asset and other directly attributable costs incurred to bring the asset to the location and condition for its intended use. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment. Where parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items of property, plant and equipment.

Depreciation is calculated on a straight-line basis to allocate the cost of assets over their estimated useful lives. Land is not depreciated.

The estimated useful lives for the current and comparable period are:

Buildings 40 years

Plant and equipment 3 to 10 years

Motor vehicles 5 to 10 years

ImpairmentThe carrying values of plant and equipment are reviewed for impairment when events or changes in circumstances indicate the carrying value may not be recoverable. For an asset that does not generate largely independent cash flows, the recoverable amount is determined for the cash-generating unit the asset belongs to. If any such indication exists and where the carrying values exceed the estimated recoverable amount, the assets or cash generating units are written down to their recoverable amount.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset.

Where an item of property, plant and equipment is derecognised, the gain or loss (calculated as the difference between the net proceeds and the carrying value of the item) is included in the income statement in the period the item is derecognised.


40


k) Intangible assetsProgramme RightsTelevision programmes which are available for use, including those acquired overseas, are recorded at cost less amounts charged to the income statement based on management’s assessment of the useful life, which is regularly reviewed and additional write downs are made as considered necessary. Programmes produced internally for the purpose of broadcast are initially recognised as intangible assets at production cost. Production costs only include direct costs associated with the programme.

Programme rights are amortised on the following basis:(i) Non movie programme rights are amortised on a straight line basis such that all rights are amortised within a period not exceeding one year from the broadcast licence period start date. Certain programme rights including news and current affairs, sports and locally commissioned programmes are amortised on transmission.

(ii) Movie programme rights are amortised on a straight line basis such that all rights are amortised within a period not exceeding one year from the broadcast licence period start date (FY2009 amortised within a period not exceeding three years from licence period start date – refer note 6 for further explanation).

Frequency licencesFrequency licences are recorded at cost less amortisation and impairment losses. Amortisation is calculated on a diminishing value methodology using the sum of digits over the remaining life of the licence.

Other intangible assetsAcquired software licences are capitalised on the basis of the costs incurred to acquire and bring to use the specific asset. These costs are amortised on a straight line basis over their estimated useful economic lives of two to ten years.

Development costsDevelopment costs on internal projects are only capitalised by the Group when it can be demonstrated that the technical feasibility of completing the intangible asset is valid so that the asset will be available for use. Any development costs capitalised are amortised over the period of the estimated economic life of the asset to which they relate.

Where an intangible asset is derecognised, the gain or loss (calculated as the difference between the net proceeds and the carrying value of the item) is included in the income statement in the period the item is derecognised.

l) Cash and cash equivalentsCash and short term deposits in the statement of financial position comprise cash at the bank and in hand and short term deposits with an original maturity of three months or less.

For the purposes of the cash flow statement, cash and cash equivalents comprise cash and cash equivalents as defined above, net of outstanding overdrafts.

m) Trade and other receivablesTrade receivables are recognised and carried at original invoice amount and subsequently measured at amortised cost, less an allowance for impairment.

Collectibility of trade receivables is reviewed on an ongoing basis and debts that are known to be uncollectible are written off immediately. An allowance for doubtful debts is recognised when there is objective evidence that the Group will not be able to collect the receivable. Financial difficulties of the debtor, default payments or debts more than 90 days overdue are considered objective evidence of impairment.


41


n) InventoriesInventories comprise technical stores and videotape. All inventories are recorded at the lower of cost or net realisable value.

o) Derivative financial instrumentsThe Group uses derivative financial instruments, within predetermined policies and limits, to manage its exposure to foreign currency exchange rate risk and interest rate risk. The Group also enters into programme supply contracts that contain a foreign currency embedded derivative.

Such derivative financial instruments are initially recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured at their fair value. The method of recognising the resulting gain or loss depends on whether the derivative contract is designed to hedge a specific risk and qualifies for hedge accounting.

Each derivative that is designated as a hedge is classified as either: i) a fair value hedge when they hedge the exposure to changes in the fair value of a recognised asset or liability or a firm commitment; or ii) a cash flow hedge where they hedge exposure to variability in cash flows that is either attributable to a particular risk associated with a recognised asset or liability or a forecasted transaction.

i) Fair value hedgeChanges in the fair value of derivatives that are designated and qualify as fair value hedges are recorded in the income statement, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.

ii) Cash flow hedgeThe effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges are recognised in other comprehensive income. The gain or loss relating to the ineffective portion is recognised in the income statement. Amounts accumulated are recycled in the income statement in the period when the hedged item affects profit or loss. When the hedged firm commitment results in the recognition of an asset or a liability, then, at the time the asset or liability is recognised, the associated gains or losses that had previously being recognised in equity are included in the initial measurement of the acquisition cost or other carrying amount of the asset or liability.

Hedge accounting is discontinued when the hedging instrument expires or is sold, or when the hedge no longer meets the criteria for hedge accounting. At that point any cumulative gain or loss existing in equity remains in equity until the forecast transaction occurs. When a forecasted transaction is no longer expected to occur, the cumulative gain or loss is immediately transferred to the income statement.

For derivatives that do not qualify for hedge accounting, any gains or losses arising from changes in fair value are recognised immediately in the income statement. The fair value of forward exchange contracts and embedded derivatives are calculated by reference to current forward exchange rates for contracts with similar maturity profiles. The fair value of interest rate swap contracts is determined by reference to market values of similar instruments.

In accordance with its treasury policy, the Group does not engage in speculative transactions or hold derivative financial instruments for trading purposes.

p) Borrowings and borrowing costsBorrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost using the effective interest method. Borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset are capitalised as part of the cost of that asset. All other borrowing costs are expensed in the period they occur.

q) Trade and other payablesTrade and other payables are carried at amortised cost and due to their short term nature they are not discounted. Trade and other payables are recognised when the Group becomes obliged to make future payments resulting from the purchases of goods and services.

r) Investment in associateThe Group’s investment in its associates is accounted for using the equity method of accounting in the consolidated financial statements. Associates are entities over which the Group has significant influence, but not control, over the financial and operating policies. The consolidated financial statements include the Group’s share of the income and expenses of the associate from the date that significant influence commenced until the date that significant influence ceases. The Group’s share of its associate post acquisition profits or losses is recognised in the income statement and its share of post acquisition movements in other comprehensive income is recognised in other comprehensive income. The cumulative post acquisition movements are adjusted against the carrying amount of the investment. When the Group’s share of losses in an associate exceeds its interest in the associate, including any unsecured long-term receivables and loans, the Group does not recognise any further losses, unless it has incurred obligations or made payments on behalf of the associate.

s) Interest in a jointly controlled entityThe interest in a joint venture entity is accounted for in the consolidated financial statements using the equity method of accounting and is


42


carried at cost by the parent entity. Under the equity method, the Group’s share of the results of the joint venture is recognised in the income statement, and the share of movements in reserves is recognised in the statement of financial position.

t) Employee benefitsProvision is made for employee benefits accumulated as a result of employees rendering services up to balance date. The benefits include wages and salaries, incentives, compensated absences and retirement leave which are expensed in the income statement when services are provided or benefits vest with the employee. The provision for employee benefits is stated at the present value of the estimated future cash outflows to be incurred resulting from employees’ services provided up to balance date.

u) ProvisionsProvisions are recognised when the Group has present legal or constructive obligation as a result of a past event that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation.

If the effect of time value of money is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability.

v) ComparativesThe classifications of certain balances have been revised and the comparatives have been restated accordingly.

3) Significant accounting judgements, estimates and assumptionsThe preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Estimates and assumptions are reviewed by management on an ongoing basis. Actual results may differ from these estimates.

Management has identified the following accounting policies for which significant judgements, estimates and assumptions are made:

Estimation of useful lives of property, plant and equipment and finite-lived intangible assetsThe estimated useful life of a particular asset is based on historical experience, the expected service potential of the assets and technological advances. Adjustments to useful lives are made when considered necessary.

Income taxes and deferred taxThe Group’s accounting policy for taxation requires management to make estimates as to, amongst other things, the amount of tax that will be payable, the availability of losses to be carried forward and the recovery of deferred tax assets.

Deferred tax assets are recognised for deductible temporary differences as management considers that it is probable that future taxable profits will be available to utilise those temporary differences.

Capitalised development costsDevelopment costs are only capitalised by the Group when it can be demonstrated that the technical feasibility of completing the intangible asset is valid so that the asset will be available for use.

Actual results may differ from these estimates as a result of reassessment by management or taxation authorities.


43


Group Company

2010 2009 2010 2009

$000 $000 $000 $000

4) Operating revenue

Television advertising revenue 284,275 298,404 284,275 298,404

Commercial production funding 3,939 5,462 3,939 5,462

Satellite sub lease revenue 400 400 400 400

Other trading revenue 25,055 28,947 25,055 28,947

313,669 333,213 313,669 333,213

5) Expenses

Expenses include:

Employee benefits expense

Wages and salaries and other short term benefits 90,260 94,802 90,260 94,802

Defined contribution superannuation expense 2,578 2,718 2,578 2,718

less employee benefits charged to programmes/capitalised (31,103) (32,591) (31,103) (32,591)

61,735 64,929 61,735 64,929

Depreciation and amortisation

Depreciation 13,612 13,424 13,612 13,424

Amortisation - software 4,143 2,574 4,143 2,574

Amortisation - licences 815 949 815 949

18,570 16,947 18,570 16,947

Auditors' remuneration

Audit of financial statements 270 249 270 249

Other assurance related services 29 60 29 60

299 309 299 309

Other assurance related services in the current year primarily relate to technology assurance activities.

Rental and operating lease costs 4,120 4,841 4,120 4,841

6) Programme amortisation revision

Additional programme amortisation (note 13) (28,965) 0 (28,965) 0

Additional funding revenue - Government (note 19a) 1,773 0 1,773 0

Additional funding revenue 343 0 343 0

(26,849) 0 (26,849) 0

Programme costs are amortised over the programmes estimated commercial useful life. From a commercial perspective, the useful life of programmes has reduced as repeat screenings of programmes in prime time have significantly reduced, those repeat screenings are now closer to the original transmission date and there are now many alternate viewing opportunities for programmes prior and subsequent to the transmission by TVNZ.

This revision resulted in the programme amortisation period of locally produced programmes being changed from straight line amortisation over 12 months from licence period start date to fully amortise on first transmission. The amortisation period for movies has been reduced from 36 months to 12 months. The effect of this revision has been to accelerate the expensing of programme costs. The revised amortisation rates have been applied to all programme rights on hand at 30 June 2010.

Programme funding is recognised as revenue in line with the recognition of programme expense. As a result of the change in programme amortisation periods additional funding revenue is also recognised in the current period.


44

Group Company

2010 2009 2010 2009

$000 $000 $000 $000

7) Reorganisation costs

Reorganisation costs 944 3,729 944 3,729

Costs associated with the reorganisation of the Company have been fully recognised in the current financial year. These costs included redundancy, outplacement, consultancy and sundry other costs associated with the reorganisation (refer note 20 for the details of the provision movement).

8) Financial Instruments and Foreign currency gains/(losses)

Fair value changes of derivative financial instruments (2,853) (2,125) (2,853) (2,125)

Foreign currency realised gains/(losses) 3,317 1,546 3,242 1,494

Foreign currency unrealised gains/(losses) 690 955 690 955

1,154 376 1,079 324

9) Income tax

On 20 May 2010 the New Zealand Government announced a change in the corporate tax rate from 30% to 28% from the beginning of the 2011/12 income year. This change in income tax rate has resulted in a decreased charge to tax expense of $351,000 and a corresponding increase in the deferred tax asset. The Government also announced the effective removal of tax depreciation allowances on buildings with an expected lifespan of 50 years or more. This change has resulted in an additional charge to the tax expense of $14,541,000 and a corresponding increase in the deferred tax liability.

a) Income tax

The major components of income tax expense are:

Income Statement

Current income tax

Current period 124 477 133 506

Adjustments for prior period 70 (22) 106 (22)

194 455 239 484

Deferred income tax

Origination and reversal of temporary differences (4,867) 1,047 (4,898) 1,002

Impact of change to income tax legislation 14,190 0 14,190 0

9,323 1,047 9,292 1,002

Total income tax expense 9,517 1,502 9,531 1,486

b) Income tax recognised directly in equity

Net movement on revaluation of cash flow hedges 146 (43) 146 (43)

Total income tax recognised directly in equity 146 (43) 146 (43)



45


9) Income tax (continued)

Group Company

2010 2009 2010 2009

$000 $000 $000 $000

c) Reconciliation of income tax expense

Profit/(loss) before income tax for the period (16,509) 3,604 (16,678) 4,563

Taxation at 30% (4,953) 1,081 (5,003) 1,369

Adjusted for the tax effect of:

Non deductible expenditure 289 139 289 139

Non assessable income (51) 0 (51) 0

Share of results of associated company (28) 304 0 0

Income tax (over)/under provided in prior years 70 (22) 106 (22)

Impact of change in corporate tax rate (351) 0 (351) 0

Impact of change in tax depreciation on buildings 14,541 0 14,541 0

Total tax expense 9,517 1,502 9,531 1,486

d) Recognised deferred tax assets

Group Company

2010 2010

Current Income Tax

Deferred Income Tax

Current Income Tax

Deferred Income Tax

$000 $000 $000 $000

Opening balance 2,338 11,233 2,354 11,200

Charged to income statement - tax expense (194) 4,867 (239) 4,898

Charged to income statement - income tax changes 0 (14,190) 0 (14,190)

Charged to equity 0 146 0 146

Other payments/(receipts) (1,842) 0 (1,788) 0

Closing balance 302 2,056 327 2,054

Tax expense in income statement (9,517) (9,531)

Amounts recognised in the balance sheet:

Deferred tax asset 2,056 2,054

Group Company

2009 2009

Current Income Tax

Deferred Income Tax

Current Income Tax

Deferred Income Tax

$000 $000 $000 $000

Opening balance 942 12,323 942 12,245

Charged to income statement (455) (1,047) (484) (1,002)

Charged to equity 0 (43) 0 (43)

Other payments 1,851 0 1,896 0

Closing balance 2,338 11,233 2,354 11,200

Tax expense in income statement (1,502) (1,486)

Amounts recognised in the balance sheet:

Deferred tax asset 11,233 11,200


46

9) Income tax (continued)

Group Company

Balance Sheet Balance Sheet

2010 2009 2010 2009

$000 $000 $000 $000

Deferred income tax at 30 June relates to the following:

Deferred tax assets

Programme rights 10,577 4,191 10,577 4,191

Employee entitlements 2,846 2,964 2,846 2,964

Property, plant and equipment and software (13,414) 1,953 (13,414) 1,953

Provisions 268 282 268 282

Frequency licences 610 684 608 650

Funding 0 92 0 92

Doubtful debts 26 34 26 34

Other 271 463 271 464

Tax losses 966 553 966 553

Derivative financial instruments (94) 17 (94) 17

2,056 11,233 2,054 11,200

Group and Company

2010 2009

$000 $000

e) Imputation credit account

Balance at start of the year 11,463 14,751

Income tax paid/(received) during the year (2,028) 1,785

Credits attached to dividends paid during the year (724) (5,073)

Balance at end of the year 8,711 11,463

The Company and subsidiaries are part of the same consolidated tax group, therefore the imputation credits available to the Group and the Company are the same.



47


Group Company

2010 2009 2010 2009

$000 $000 $000 $000

10) Cash and cash equivalents

Cash at bank and in hand 163 186 163 186

Short term deposits 991 1,861 991 1,861

Cash and cash equivalents 1,154 2,047 1,154 2,047

Bank overdrafts used for cash management purposes (159) (171) (159) (171)

Cash and cash equivalents in the statement of cash flows 995 1,876 995 1,876

11) Receivables and prepayments

Trade receivables 34,272 34,940 34,272 34,940

Less provision for receivables impairment (86) (114) (86) (114)

Prepaid programme rights 14,451 21,716 14,451 21,716

Prepayments - other 6,749 5,672 6,749 5,672

Tax receivable 302 2,338 327 2,354

55,688 64,552 55,713 64,568

a) Provision for receivables impairment

Trade receivables are non interest bearing and are generally on 30-60 day terms. A provision for receivables impairment is recognised when there is objective evidence that the receivable is impaired.

Movements in the provision for receivables impairment

At 1 July 114 96 114 96

Charge/(reversal) for the year 35 108 35 108

Amounts written off (63) (90) (63) (90)

At 30 June 86 114 86 114

Trade receivables that are less than 90 days overdue are not considered impaired. As at 30 June 2010 trade receivables of $849,000 (2009: $1,228,000) were past due but not considered impaired. Direct contact has been made with these debtors and the Company is satisfied that payment will be made in full. Payment terms on these amounts have not been renegotiated however credit has been stopped until full payment is made. At 30 June, the ageing analysis of trade receivables is as follows:

Current 33,337 33,598 33,337 33,598

Up to 30 days overdue 624 992 624 992

Between 30 and 90 days overdue 225 175 225 175

Over 90 days overdue - past due not impaired 0 61 0 61

Over 90 days overdue - past due considered impaired 86 114 86 114

34,272 34,940 34,272 34,940

b) Fair value and credit risk

Due to the short term nature of these receivables, their carrying value is assumed to approximate their fair value (refer note 21 for details of credit risk).


48


12) Property, plant and equipment

Group and Company

Land & buildings

Plant & equipment

Motor vehicles

Work in progress Total

$000 $000 $000 $000 $000

Year ended 30 June 2010

At 1 July 2009 net of accumulated depreciation and impairment 63,958 36,630 705 6,102 107,395

Additions 837 4,366 0 15,388 20,591

Reclassification from WIP 1,749 2,127 0 (3,876) 0

Disposals (2) (47) (1) 0 (50)

Depreciation charge (2,900) (10,531) (181) 0 (13,612)

Closing net book amount 63,642 32,545 523 17,614 114,324

At 30 June 2010

Cost 107,833 186,463 2,412 17,614 314,322

Accumulated depreciation (44,191) (153,918) (1,889) 0 (199,998)

63,642 32,545 523 17,614 114,324


At 1 July 2008 net of accumulated depreciation and impairment 65,437 35,509 799 8,567 110,312

Additions 1,200 5,480 0 4,886 11,566

Reclassification from WIP 183 6,031 88 (6,302) 0

Reclassification opening WIP to intangibles 0 0 0 (1,049) (1,049)

Disposals 0 (10) 0 0 (10)

Depreciation charge (2,862) (10,380) (182) 0 (13,424)

Closing net book amount 63,958 36,630 705 6,102 107,395

At 30 June 2009

Cost 105,249 184,228 2,574 6,102 298,153

Accumulated depreciation (41,291) (147,598) (1,869) 0 (190,758)

63,958 36,630 705 6,102 107,395

The Directors are satisfied that the fair value of land and buildings is not less than their book value and that there has been no permanent diminution in the overall value of land and buildings.


49


13) Intangible assets

Group and Company

Programme Rights

Software Software

Licences Licences Total

Note $000 $000 $000 $000


At 1 July 2009 net of accumulated amortisation and impairment 82,181 18,118 2,865 103,164

Additions (internal) 66,882 0 0 66,882

Additions (external) 132,628 7,254 0 139,882

Amortisation charge (205,650) (4,143) (815) (210,608)

Additional programme amortisation 6 (28,965) 0 0 (28,965)

Closing net book amount 47,076 21,229 2,050 70,355

At 30 June 2010

Cost 207,903 55,091 16,369 279,363

Accumulated amortisation (160,827) (33,862) (14,319) (209,008)

47,076 21,229 2,050 70,355

Current asset 47,076 0 0 47,076

Non current asset 0 21,229 2,050 23,279

47,076 21,229 2,050 70,355


At 1 July 2008 net of accumulated amortisation and impairment 81,046 10,156 3,814 95,016

Additions (internal) 88,625 0 0 88,625

Additions (external) 144,099 9,487 0 153,586

Reclassification from PPE WIP 0 1,049 0 1,049

Amortisation charge (231,589) (2,574) (949) (235,112)

Closing net book amount 82,181 18,118 2,865 103,164

At 30 June 2009Cost 229,282 47,837 17,986 295,105

Accumulated amortisation (147,101) (29,719) (15,121) (191,941)

82,181 18,118 2,865 103,164

Current asset 64,463 0 0 64,463

Non current asset 17,718 18,118 2,865 38,701

82,181 18,118 2,865 103,164

Included in software are assets under development of $286,000 (2009: $11,506,000).


50


Company

2010 2009

$000 $000

14) Investments in subsidiaries

Shares 1,766 1,594

Advances to subsidiaries 8,482 3,616

10,248 5,210

The Company’s investment in its subsidiaries comprises shares at cost, advances to/(from) subsidiaries less any provision for impairment. Advances to subsidiaries are interest free, unsecured and repayable on demand.

Subsidiaries of Television New Zealand Limited comprise:

% holding

Name Principal activity 2010 2009

TVNZ Satellite Services Limited Non trading 100% 100%

nzoom Limited Non trading 100% 100%

TVNZ International Limited Non trading 100% 100%

Avalon Studios Limited Non trading 100% 100%

Horizon Pacific Television Limited and subsidiaries Non trading 100% 100%

All companies are incorporated in New Zealand. All have balance dates of 30 June.

15) Interest in associate

The Group acquired a 33% interest in Hybrid Television Services (ANZ) Pty Ltd in 2009. The total acquisition price was $9,984,000 payable in two equal instalments in June and August 2009. The final instalment was included in trade and other payables in 2009.

2010 2009

$000 $000

a) Movement in carrying amount of the Group's investment in associate

Hybrid Television Services (ANZ) Pty Ltd - 33%

At 1 July 9,151 0

Acquisition cost 0 9,984

Share of gains/(losses) after income tax 94 (1,011)

Increase in investment 172 178

At 30 June 9,417 9,151

b) Summarised financial information

The following table illustrates summarised financial information relating to the Group's associate.

Current assets 22,466 18,377

Non current assets 9,298 3,851

31,764 22,228

Current liabilities 6,046 3,431

Non current liabilities 14,204 11,973

20,250 15,404

Net assets 11,514 6,824

Share of associates' net assets 3,800 2,252

Revenue 52,532 19,933

Net profit/(loss) 327 (13,895)


51


16) Interest in joint venture

The Company has a 44.9% interest in Freeview Limited an incorporated joint venture with TVWorks Limited, Maori Television Service and Radio New Zealand Limited. Freeview Limited is audited by Ernst Young and has a balance date of 30 June.

The carrying amount of the company’s investment in Freeview Limited is $nil (2009: $nil).

The following table provides summarised financial information relating to the Company’s joint venture:

Extract from the joint venture balance sheet:

2010 2009

$000 $000

Current assets 343 751

Non current assets 596 815

939 1,566

Current liabilities 710 1,156

Non current liabilities 229 410

939 1,566

Net assets 0 0

Share of joint ventures net assets 0 0

Extract from joint venture income statement:

Revenue 6,699 6,766

Net profit 0 0

There are no contingent liabilities relating to the Company’s interest in the joint venture and no contingent liabilities or capital commitments of the venture itself.

Group Company

2010 2009 2010 2009

$000 $000 $000 $000

17) Loans and borrowings

Current

Bank overdraft (unsecured) 159 171 159 171

Bank borrowings (unsecured) 0 36,050 0 36,050

159 36,221 159 36,221

Non current

Bank borrowings (unsecured) 36,600 0 36,600 0

The Group has three revolving cash advance facilities committed to a maximum amount of $120 million (June 2009: $120 million); these facilities expire in December 2012. The borrowings at 30 June are drawn down from these facilities. The borrowings at 30 June 2009 were drawn on facilities that expired in January 2010 and were therefore classified as current liabilities. Refer Note 21 for details on management of interest rate risk related to these borrowings. Due to the short term nature of the borrowings, the financing cash flow has been presented as a net movement with the exception of the borrowings repaid and drawn down on the renewal date of the cash advance facilities.

a) Fair values

The carrying amounts of the Group’s current and non current borrowings approximate their fair value.

b) Defaults and breaches

During the current and prior years, there were no defaults or breaches of any loan covenants.


52


Group Company

2010 2009 2010 2009

$000 $000 $000 $000

18) Trade and other payables

Current

Trade payables and accruals 36,373 44,294 36,373 39,299


43,783 51,960 43,783 46,965

Fair value

Due to the short term nature of these payables, their carrying value is assumed to approximate their fair value.

Non-current


19) Deferred income

Government funding 16,426 26,482 16,426 26,482

Other 1,406 457 1,406 457

17,832 26,939 17,832 26,939

a) Government funding

Group and Company

MCH NZOA TMP Total

$000 $000 $000 $000


At 1 July 2009 19,366 7,116 0 26,482

Received/invoiced during the year 19,757 8,129 5,291 33,177

Released to the income statement (25,135) (11,034) (5,291) (41,460)

Programme utilisation change additional release (note 6) (420) (1,353) 0 (1,773)

Closing net book amount 13,568 2,858 0 16,426


At 1 July 2008 31,454 3,090 0 34,544

Received/invoiced during the year 13,757 24,125 5,290 43,172

Released to the income statement (25,845) (20,099) (5,290) (51,234)

Closing net book amount 19,366 7,116 0 26,482

Government funding received during the year was in the form of cash, and has been recorded at fair value. The Ministry for Culture and Heritage (MCH) provides funding to TVNZ to provide transmission of TVNZ programmes to Pacific nations, maintain non commercial transmission sites, fund TVNZ’s two digital channels broadcast on the Freeview platform and to assist in the implementation of the Charter (to June 2008). New Zealand on Air (NZOA) funds TVNZ for specific programmes, programme captioning and to assist in the implementation of the Charter (FY2009 only). Te Mangai Paho provides funding for the production and broadcast of specific programmes. The funding will be recognised in the income statement to match the expenditure associated with this funding. For further details of government funding please refer to the Statement of Service Performance.


53


Group Company

2010 2009 2010 2009

$000 $000 $000 $000

20) Provisions

Restructuring 893 1,520 893 1,520

Onerous Lease 0 556 0 556

893 2,076 893 2,076

a) Movement in provisions

Group and Company

Restructuring Onerous Lease Total

$000 $000 $000

At 1 July 2009 1,520 556 2,076

Raised during the year 893 0 893

Utilised during the year (1,520) (321) (1,841)

Reversed during the year 0 (235) (235)

At 30 June 2010 893 0 893

Current 893 0 893

Non-current 0 0 0

At 30 June 2010 893 0 893

Current 2009 1,520 278 1,798

Non-current 2009 0 278 278

At 30 June 2009 1,520 556 2,076

b) Nature and timing of provision

i) Restructuring provision

The current restructuring provision balance relates to the costs of redundancy, outplacement and other costs associated with the reorganisation of broadcast services in April 2010. The opening restructuring provision related to redundancy, outplacement and other costs associated with the reorganisation of TVNZ that commenced in February 2009 –this was completely utilised in the current year.

ii) Onerous Lease provision

At 30 June 2009 the company had a non-cancellable lease for office and garage space which due to changes in location of resources was no longer to be used. In the current financial year the remaining term of the lease was assigned and the balance of the provision was released to the income statement.

21) Financial risk factors

The Group’s activities expose it to a variety of financial risks including currency risk, interest rate risk, credit risk and liquidity risk. The Group’s overall risk management policy seeks to minimise potential adverse effects on the Group’s financial performance.

Treasury policies have been approved by the Board for managing each of these risks including levels of authority on the type and use of financial instruments. The Group enters into derivative transactions, principally forward currency contracts and interest rate swaps, only if they relate to underlying exposures.

The Group has the following categories of financial instruments:Held for trading financial assets (including derivative financial instruments); loans and receivables (including cash and cash equivalents and trade receivables); held for trading financial liabilities (including derivative financial instruments); and financial liabilities measured at amortised cost (including trade and other payables and loans and borrowings).

The carrying amounts of these financial instruments are disclosed on the face of the statement of financial position or in each of the applicable notes.


54

21) Financial risk factors (continued)

Currency riskThe Group undertakes transactions denominated in foreign currencies, predominately Australian and US dollars, for programme rights purchases. As a result of these transactions the Group has exposure to foreign exchange risk. The Group’s foreign exchange policy is to hedge a portion of material foreign currency denominated costs at the time of the commitment on a rolling 24 month basis. The Group ensures that its net exposure to foreign denominated cash balances is kept to an acceptable level by buying or selling foreign currencies at spot rates when necessary to address short term imbalances.

At 30 June the Group had the following foreign currency exposures that are not specifically hedged.

Group Company

2010 2009 2010 2009

$000 $000 $000 $000

Financial assets

Cash and cash equivalents 125 149 125 149

Trade and other receivables 498 139 498 139

Loan to associate 4,247 2,197 4,247 2,197

4,870 2,485 4,870 2,485

Financial Liabilities

Bank overdraft 0 (92) 0 (92)

Trade and other payables (12,370) (15,110) (12,370) (15,110)

(12,370) (15,202) (12,370) (15,202)

Foreign Currency Derivatives

Forward contracts 22,797 78,536 22,797 78,536

Embedded derivatives (16,878) (20,752) (16,878) (20,752)

5,919 57,784 5,919 57,784

Total net exposure (1,581) 45,067 (1,581) 45,067

At 30 June , had the New Zealand dollar strengthened/(weakened) by 10% against foreign currencies with all other variables held constant, post tax profit and equity would have been (lower)/higher as follows:

Group and Company

Post Tax Profit Equity

+10% (10%) +10% (10%)

2010 327 (327) 327 (327)

2009 (3,326) 3,326 (3,350) 3,350

Interest rate riskThe Group’s exposure to interest rate risk relates primarily to long term borrowings.

At 30 June, the Group had the following mix of financial assets and liabilities exposed to variable interest rate risk that are not designated in cash flow hedges:

Group Company

2010 2009 2010 2009

$000 $000 $000 $000

Financial assets

Cash and cash equivalents 1,154 2,047 1,154 2,047

Financial liabilities

Bank overdrafts (159) (171) (159) (171)

Bank loans (1,600) (16,050) (1,600) (16,050)

Net exposure (605) (14,174) (605) (14,174)



55


The Group’s interest rate policy is to have between 0% and 100% of its borrowings at fixed rates over the medium term. The Group uses interest rate swaps in order to achieve the desired mix between fixed and floating rates. These swaps are designated to hedge underlying debt obligations. At 30 June 2010, after taking into account the effect of interest rate swaps, approximately 95% of the Group’s borrowings are at a fixed rate of interest (2009: 55%).

At 30 June, if interest rates had increased/(decreased) by 1% with all other variables held constant, post tax profit and equity would have been (lower)/higher as follows:

Group and Company

Post Tax Profit Equity

+1% (1%) +1% (1%)

2010 (249) 249 (249) 249

2009 (239) 239 (239) 239

Credit riskCredit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its obligations. In the normal course of business the Group incurs credit risk with financial institutions and trade receivables. The Group has a credit policy which is used to limit counterparty risk through restrictions on the amount of short-term investments that may be placed with any one approved financial institution.

The exposure at balance date equals the carrying value of cash, derivative financial instruments (assets) and trade receivables as shown in the statement of financial position and specified in applicable notes.

The major concentration of credit risk within trade receivables is the extension of credit to advertisers through accredited advertising agencies. These agencies are required to comply with a formal accreditation process, which includes the regular review of their financial position. Each accredited agency is required to meet a certain financial ratio or alternatively provide other forms of financial reassurance to the Group. The Group has a credit insurance policy for a selected range of agencies, to protect against loss through default. The Group does not have any other significant concentrations of credit risk.

The Group does not require collateral or security to support financial instruments due to the quality of the financial institutions with which it deals.

Liquidity riskLiquidity risk is the risk that the Group and Company may be unable to meet its financial obligations as they fall due. It is the Group’s policy to ensure that adequate funding is available at all times to meet future commitments as they arise. Management monitors rolling forecasts of the Group’s liquidity reserve on the basis of expected cash flows.

At 30 June 2010 the Group has available $83,400,000 (2009: $83,950,000) of un-drawn committed facilities. These bank facilities expire in December 2012.

The considered view of the directors is that, after making due enquiry, there is a reasonable expectation that the Group has adequate resources to continue operations at existing levels for the next 12 months from date of signing accounts.

All banking covenants have been complied with in the current year and at this time it is expected that this will be the case for the next 12 months. To this end the Directors believe that the going concern assumption is a valid basis on which to prepare the financial statements.

If the Group was unable to continue in operational existence, adjustments would have to be made to reflect the situation that assets may need to be realised other than in the normal course of business and at amounts which could differ significantly from amounts which are currently recorded in the statement of financial position. In addition, liabilities may need to be recognised for costs associated with the realisation process.

The income statement and the statement of financial position for the Group do not include any adjustments should the financial support not continue.



56


The table below analyses the contractual cash flows for all financial liabilities and derivatives.

Within one year

One to two years

Two to five years

Total

Group $000 $000 $000 $000

Bank overdraft 159 0 0 159

Borrowings 1,936 1,936 37,487 41,359

Trade and other payables 36,373 0 0 36,373

Interest rate swaps 131 0 0 131

Forward exchange contracts 25,192 0 0 25,192

63,791 1,936 37,487 103,214

Within one year

One to two years

Two to five years

Total

Parent $000 $000 $000 $000


Borrowings 1,936 1,936 37,487 41,359



Forward exchange contracts 25,192 0 0 25,192

63,791 1,936 37,487 103,214

Within one year

One to two years

Two to five years

Total

Group $000 $000 $000 $000


Borrowings 36,050 0 0 36,050



Forward exchange contracts 69,290 11,899 0 81,189

149,886 11,899 0 161,785

Within one year

One to two years

Two to five years

Total

Parent $000 $000 $000 $000


Borrowings 36,050 0 0 36,050



Forward exchange contracts 69,290 11,899 0 81,189

144,891 11,899 0 156,790


2010

2009


57



Fair valueThe Group uses various methods in estimating the fair value of a financial instrument. The methods comprise:

Level 1 – the fair value is calculated using quoted prices in active markets.

Level 2 – the fair value is estimated using inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices).

Level 3 – the fair value is estimated using inputs for the asset or liability that are not based on observable market data.

The fair value of the financial instruments is estimated using Level 2 criteria. The fair values of financial instruments are presented in the following table.

Group and Company

2010 2009

$000 $000

Financial assets

Derivative instruments

Foreign currency contracts 1,033 4,196

Foreign currency embedded derivative contracts 330 26

Interest rate swaps 0 156

1,363 4,378

Financial liabilities

Derivative instruments

Foreign currency contracts 0 143

Foreign currency embedded derivative contracts 0 80

Interest rate swaps 366 30

366 253

Capital managementThe Group’s capital includes share capital, reserves and retained earnings.

The Crown has a general preference for state-owned enterprises and crown-entity companies (including TVNZ) to manage their balance sheets to a BBB (flat) credit rating. The Group’s capital structure is broadly in line with the Crown’s expectations. The Group targets a gearing ratio of less than 40% (refer note 29e).

There have been no material changes to the Group’s management of capital during the period.


58


Group Company

2010 2009 2010 2009

$000 $000 $000 $000

22) Derivative financial instruments

Current assets

Forward currency contracts - held for trading 821 3,235 821 3,235

Forward currency contracts - fair value hedge 210 136 210 136

Foreign currency embedded derivative contracts 323 0 323 0

Interest rate swap contracts - cash flow hedge 0 156 0 156

1,354 3,527 1,354 3,527

Non-Current assets

Forward currency contracts - held for trading 0 825 0 825



9 851 9 851

Current liabilities



Forward currency contracts - cash flow hedge 0 7 0 7

Interest rate swap contracts - cash flow hedge 366 0 366 0

Interest rate swap contracts - held for trading 0 30 0 30

576 253 576 253

Non-Current liabilities


2 0 2 0a) Instruments used by the GroupDerivative financial instruments are used by the Group in the normal course of business in order to hedge exposures to fluctuations in foreign exchange and interest risk.

i) Forward currency contracts – held for tradingThe Group has entered into forward exchange rate contracts which are economic hedges but do not satisfy the requirements for hedge accounting. The following table details the notional amounts of these derivative financial instruments at balance date.

Group and Company

2010 2009

NZD NZD

$000 $000

Buy AUD/Sell NZD - Maturity 0 - 12 months 22,797 64,872

Buy AUD/Sell NZD - Maturity 13 - 24 months 0 11,899

Buy EUR/Sell NZD - Maturity 0 - 12 months 0 1,765

ii) Forward currency contracts – fair value hedge

The Group has entered into forward exchange rate contracts which are economic hedges against the purchase of certain capital, programme rights and production expenditure. The fair value gains/(losses) on the hedged item are equal to the fair value gains/(losses) of the hedging instrument. The following table details the notional amounts of these derivative financial instruments at balance date.

Forward currency contracts – fair value hedge

Buy EUR/Sell NZD - Maturity 0 - 12 months 0 1,569

Buy GBP/Sell NZD - Maturity 0 - 12 months 1,979 202

Buy GBP/Sell NZD - Maturity 13 - 24 months 217 0

Buy USD/Sell NZD - Maturity 0 - 12 months 416 882


59


22) Derivative financial instruments (continued)

Group and Company

2010 2009

$000 $000

iii) Foreign currency embedded derivativesThe Group has entered into programme supply contracts that contain a foreign currency embedded derivative. The following table details the notional amounts of these embedded derivatives at balance date.

Sell AUD/Buy NZD - Maturity 0 - 12 months 16,272 18,619

Sell AUD/Buy NZD - Maturity 13 - 24 months 606 2,133

iv) Interest rate swaps – cash flow hedgesTo protect against rising interest rates the Group hedges its borrowings by entering into interest rate swaps contracts under which it has the right to receive interest at fixed rates and pay interest at variable rates. All interest rate swaps are current and have a notional value at balance date of $35,000,000 (2009: $20,000,000). As at 30 June 2010 there were no interest rate swaps that were not designated as cash flow hedges (2009: $15,000,000).

23) Share capital and reserves

For movements in share capital and reserves refer to the Statement of Changes in Equity.

a) Share capitalAs at 30 June 2010 there were 140,000,000 shares issued and fully paid (2009: 140,000,000). All ordinary shares rank equally with one vote per share and carry rights to dividends.

Upon winding up, shareholders rank equally with regard to the company’s residual assets.

b) Nature and purpose of the Cash Flow Hedge ReserveThis reserve records the portion of the gain or loss on a hedging instrument in a cash flow hedge that is determined to be an effective hedge.

Group Company

2010 2009 2010 2009

$000 $000 $000 $000

Net movement in cash flow hedge reserve

Gain/(loss) taken to equity (256) 84 (256) 84

Transferred to cost of hedged item (84) 17 (84) 17

(340) 101 (340) 101

24) Cash flow statement reconciliation

Reconciliation of net profit after tax to net cash flows from operations

Net profit (26,026) 2,102 (26,209) 3,077

Adjustments for:

Depreciation 13,612 13,424 13,612 13,424

Amortisation 4,958 3,523 4,958 3,523

Loss/(gain) on disposal of property, plant and equipment 13 (25) 13 (25)

Unrealised foreign currency losses (599) (955) (599) (955)

Share of associate net (gains)/losses (94) 1,011 0 0

Notional interest from associate (170) 0 (170) 0

Changes in assets and liabilities

(Increase)/decrease in receivables and prepayments 6,792 17,138 6,792 17,138

(Increase)/decrease derivative financial instruments 2,855 2,125 2,855 2,125

(Increase)/decrease deferred tax asset 9,323 1,048 9,292 1,001

(Increase)/decrease inventories 6 26 6 26

(Increase)/decrease programme rights 35,105 (105) 35,105 (105)

Increase/(decrease) trade and other payables (2,716) 1,080 (2,714) 1,080

Increase/(decrease) deferred income (9,107) (12,978) (9,107) (12,978)

Increase/(decrease) income tax payable 2,036 (1,396) 2,027 (1,412)

Increase/(decrease) provisions (1,183) 1,360 (1,183) 1,360

Net cash from operating activities 34,805 27,378 34,678 27,279


60

25) Related party disclosures

a) SubsidiariesThe consolidated financial statements include the financial statements of Television New Zealand Limited and its subsidiaries, listed in note 14. The company did not purchase or supply goods and services from or to any of its subsidiaries during the year (2009: $nil).

b) Joint ventureThe following table provides the total amount of transactions that were entered into with Freeview Limited.

Company

2010 2009

$000 $000

Joint Venture

Sales and Funding to/from Freeview Limited 2,607 2,787

Purchases from Freeview Limited 534 642

Amounts owed by Freeview Limited 111 491

Amounts owed to Freeview Limited 0 9

All transactions with the joint venture arise in the normal course of business on an arm’s length basis. None of the balances are secured.

c) AsscociateLoan to Hybrid Television Services (ANZ) Pty Ltd 4,067 2,197

The loan to associate is interest free and repayable as soon as the associate is able to repay funds.

d) Government entitiesFunding from Government entities 43,233 51,234

Sales to Government entities 1,209 1,456

Purchases from Government entities 22,281 24,714

Amounts owed by Government entities 313 1,702

Amounts owed to Government entities 1 0

Revenue in advance from Government entities 16,426 26,482

All sales and purchases with Government owned entities arise in the normal course of business on an arm’s length basis. None of the balances are secured.

e) Key management personnelKey management consists of TVNZ’s Chief Executive Officer and the members of the executive team. Key management personnel compensation is as follows:

Salary and other short term benefits 3,398 3,447

Defined contribution superannuation expense 165 169

3,563 3,616

Certain key management personnel are also non-executive directors of companies with which TVNZ has transactions in the normal course of business. Any transactions undertaken with these entities have been entered into on an arm’s length commercial basis.

f ) DirectorsDirectors’ fees 287 323

Certain Directors are also non-executive directors of companies with which TVNZ has transactions in the normal course of business. Any transactions undertaken with these entities have been entered into on an arm’s length commercial basis.



61


Group and Company

2010 2009

$000 $000

26) Commitments

a) Programme rights

Within one year 102,276 94,873

One to two years 74,267 68,899

Two to five years 67,966 62,904

Later than five years 0 0

244,509 226,676

Commitments for programme rights are primarily denominated in Australian dollars and are converted at the exchange rate ruling at the date of transaction and revalued at year end. The commitments are determined with reference to the licence period start dates.

b) Operating leases


One to two years 2,500 2,738

Two to five years 2,346 3,205

Later than five years 0 0

8,264 9,975

Neither the Company nor the Group had any finance lease commitments at balance date (2009: nil).

c) Property, plant and equipment and software


27) Contingent liabilities

In the normal course of business various legal claims have been made against Television New Zealand Limited. Given the stage of proceedings and uncertainty as to the outcomes of the claims, no estimate of the financial effect can be made and no provision for any potential liability has been made in the financial statements.

28) Events after the balance sheet date

On 24 August 2010 the Board of Directors declared a final dividend of $4,870,800, 3.48 cents per share, (2009 – $1,471,500, 1.05 cents per share) to be paid in September 2010.

There have been no other significant events occurring since balance date requiring disclosure.


62

Group

Actual Budget

$000 $000

29) Comparison of budget to actual results

a) Financial PerformanceRevenue 355,337 362,254

Operating expenses (342,353) (349,831)

Earnings before non recurring expenditure, interest, tax 12,984 12,423

Reorganisation costs (944) 0

Programme amortisation revision (net) (26,849) 0

Interest expense (2,948) (3,196)

Financial instruments/foreign currency gains/(losses) 1,154 0

Share of results of associated company 94 0

Income tax expense (9,517) (2,768)

Net profit/(loss) for the year (26,026) 6,459

b) Movements in equity

Net profit/(loss) for the year (26,026) 6,459

Distributions to the shareholder (1,472) (4,521)

Other comprehensive income (339) 0

Movements in equity for the year (27,837) 1,938

Equity at start of the year 184,892 183,013

Equity at end of the year 157,055 184,951

The decrease in operating revenue primarily relates to lower advertising revenues as a result of the economic downturn. Operating expenses are below budget levels. Interest expense is below budget due to lower average levels of borrowings and lower interest rates. The reorganisation expenses and change in programme amortisation rates were not envisaged during the budget process. Fair value changes in financial instruments are not budgeted for due to inherent volatility in exchange rates; there was a small positive result for the year. The income tax variance is a direct result of profit variances and changes to company tax rates and depreciation allowances.

The budgeted distributions to shareholders are based on 70% of the net surplus (before fair value changes in financial instruments) and the dividend being declared prior to year end; no dividend was declared prior to year end.

c) Financial Position

Current assets 105,495 125,775

Non current assets 153,194 183,019

Total assets employed 258,689 308,794

Current liabilities 63,243 64,780

Non current liabilities 38,391 59,063

Total liabilities 101,634 123,843

Share capital 140,000 140,000

Cash flow hedge reserves (255) 0

Retained earnings 17,310 44,951

Total equity 157,055 184,951

Total equity and liabilities 258,689 308,794

Certain balance sheet budgeted amounts have been reclassified to give a direct comparison to actual results.

Current and non current asset values are lower than budget and reflect the change in programme amortisation rates. Non current assets are also lower than budget as expenditure on property, plant and equipment and software intangibles was below budget and a change in tax allowances and rates has resulted in a decrease in the deferred tax asset. The lower levels of term debt reflect lower operating expenditure and capital purchases.


and financial instruments


63


Group

Actual Budget

$000 $000

29) Comparison of budget to actual results (continued)

d) Cash flowsNet cash flows from/(to):

Operating activities 34,805 15,831

Investing activities (34,673) (36,971)

Financing activities (922) 20,140

Net (decrease)/increase in cash held (790) (1,000)

Add opening cash brought forward 1,876 1,200

Net foreign exchange differences 59 0

Ending cash carried forward 1,145 200

Lower expenditure and timing of payments have offset lower revenues; this in combination with lower levels of expenditure on property plant and equipment and intangibles have resulted in lower borrowings.

e) Performance Targets

Profitability

Return on average equity (reported earnings) -15.2% 3.5%

Return on average equity (normalised earnings) 3.3% 3.5%

(normalised earnings excludes net tax effect of programme amortisation revision, financial instruments/foreign currency gains/(losses) and income tax changes)

EBITDRA/Core television revenue 11.1% 10.6%

Gearing

Net interest bearing debt/net interest bearing debt plus equity 18.9% < 40%

Financial Stability

Total equity/Total assets 60.7% > 40%

Interest Cover

EBITDRA/Interest expense 10.6 times > 4 times

EBITDRA – earnings before interest, tax depreciation, amortisation, reorganisation costs, programme amortisation revision and financial instruments/foreign currency gains/(losses)


64

This statement reports on the performance of Television New Zealand Limited (TVNZ) in relation to the output targets set in the Statement of Intent for the year ended 30 June 2010.

TVNZ reports under the Crown Entities Act 2004. Under this Act, TVNZ’s expectations of revenue and related outputs were stated in the Statement of Intent for the year ended 30 June 2010 for all categories of funding from the Crown.

TVNZ has been granted an exemption under section 143 of the Crown Entities Act from including in its Statement of Service Performance outputs which are not directly funded (in whole or in part) by the Crown.

a) Direct Government funding from the Ministry for Culture and Heritage and NZ On Air to assist TVNZ to implement the Charter

The Government provided TVNZ with direct funding through Vote Arts, Culture and Heritage for the financial years FY2003 – FY2009. This funding was for programmes and initiatives that TVNZ would not have committed funding to in a wholly commercial environment.

The table on page 65 details the programmes that have been broadcast in the period 1 July 2009 to 30 June 2010 that were funded by direct government funding, and the financial year in which TVNZ received the funding.

In addition to the table of programmes broadcast during the period, the following table reconciles the receipt of direct government funding by fiscal year with the year of broadcast of the programmes for which the funds were used.

There is generally a time lag between receipt of funding and broadcast of the programmes.

The programmes funded by direct government funding in FY2003 – FY2005 were all broadcast prior to 1 July 2010 and are therefore not included in the tables below.

i) Reconciliation of funding received by year of broadcast

Direct Government Funding Received: $

FY2006 (MCH) 15,111,110

FY2007 (MCH) 15,111,000

FY2008 (MCH) 15,111,000

FY2009 (NZOA) 15,111,000

60,444,110

Direct Government Funded Programmes Broadcast:

Funding Year FY2006 FY2007 FY2008 FY2009 Total

$ $ $ $ $

Year of Broadcast

FY2006 6,435,816 6,435,816

FY2007 1,677,180 4,976,223 6,653,403

FY2008 1,311,022 6,810,572 9,195,137 17,316,731

FY2009 2,497,321 1,718,951 1,686,393 10,888,642 16,791,307

FY2010 342,359 498,597 3,178,660 3,338,363 7,357,979

12,263,698 14,004,343 14,060,190 14,227,005 54,555,236

Still to Broadcast 2,847,412 1,106,657 1,050,810 883,995 5,888,874

Total Funding 15,111,110 15,111,000 15,111,000 15,111,000 60,444,110

STATEMENT OF SERVICE PERFORMANCEFOR THE YEAR ENDED 30 JUNE 2010


65

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66

STATEMENT OF SERVICE PERFORMANCE (CONTINUED)FOR THE YEAR ENDED 30 JUNE 2010

b) Programme funding from NZ On Air

On a specific programme-by-programme basis, funding is received from NZ On Air. The table below notes the specific funding received directly by TVNZ, from NZ On Air. This table excludes NZ On Air funding provided directly to independent production companies for programmes broadcast by TVNZ.

Month of Funding Audience

Programme Transmission Hours $ Reach 5+

Current Affairs

Q & A Jan - Jun 22.0 510,172 1,082,160

Total Arts 22.0 510,172

Factual

Country Calendar 2009 Jul - Aug 3.5 117,000 1,918,470

Country Calendar 2010 Feb - Jun 10.0 289,000 2,396,000

Total Factual 13.5 406,000

Maori

I Am TV 2009 Jul - Dec 23.0 949,794 885,650

I Am TV 2010 Apr - Jun 11.0 778,179 680,170

Polyfest May - Jun 2.5 199,987 408,670

Total Maori 36.5 1,927,960

Special Interest

Anzac Day Wreathlaying Apr 1.5 42,814 237,130

Carols in the Caves Dec 1.0 57,561 276,530

Peter Pan Dec 1.5 270,850 46,930

Praise Be 2009 Jul - Mar 14.0 282,799 755,900

Praise Be 2010 Feb - Jun 7.0 335,000 543,910

Tagata Pasifika 2009 Jul - Mar 20.0 1,056,193 1,583,880

Tagata Pasifika 2010 Mar - Jun 6.5 789,509 1,153,570

Total Special Interest 51.5 2,834,726

Childrens

Studio 2 2009 Jul - Oct 36.5 921,933 1,772,180

Studio 2 2010 Apr - Jun 26.5 1,091,000 1,553,760

Total Childrens 63.0 2,012,933

Total NZ On Air 186.5 7,691,791

Audience Reach is the total number of different people who viewed a particular programme at any time during a specified time period.

The programmes included in this table are first run only.

TVNZ has met the forecast standard through completing each production in accordance with the proposal for the production and the production specifications, such that the programmes were permitted to be broadcast.


67


c) Programme funding from Te Mangai Paho

Te Mangai Paho funds TVNZ for the production and broadcast of certain programmes. The use of Te Mangai Paho funding is for payment of costs and expenses identified in the various programme budgets.

Month of Funding Audience

Programme Transmission Hours $ Reach 5+

Marae 2009 / 10 Jul - Jun 20.0 1,493,921 804,140

Te Karere 2009 Jul - Dec 66.0 1,142,176 1,843,940

Te Karere 2010 Jan - Jun 64.5 1,039,500 1,966,420

Waka Huia 2009 / 10 Jul - Jun 38.0 1,630,089 1,030,950

Total TMP 188.5 5,305,686

Audience Reach is the total number of different people who viewed a particular programme at any time during a specified time period.

The programmes included in this table are first run only.

TVNZ has met the forecast standard through completing each production in accordance with the proposal for the production and the production specifications, such that the programmes were permitted to be broadcast.

d) Funding for programme captioning from NZ On Air

NZ On Air funds TVNZ for the purpose of providing a captioning service on TV ONE, TV2 and TV3. This funding is used to provide continuous prime time coverage (with any failure rate not to exceed a weekly rate of 10% of non captioned hours) and at least ten hours of children’s programmes per week. In addition, the daily 6pm ONE News and Tonight bulletins and Close Up must be captioned and an English language subtitling service is provided for the Maori language news programme Te Karere.

Total funding received from NZ On Air: $1,900,000

Actual Performance Measure

Target Performance Measure

Continuous captioning during prime time (6.00pm – 10.00pm) on TV ONE, TV2 and TV3. 100% 90%

At least ten hours of children’s programmes captioned per week (average) 31.9 Hours 10 Hours

Subtitles for Te Karere (repeat screening) every weekday* 98.5% 100%

Captions for ONE News 6.00pm daily 100% 100%

Captions for Tonight every week night 100% 100%

Captions for Close Up every week night 100% 100%

Minimum 135 hrs per week (average) on TVNZ channels 183.9 hrs per week 135 hrs per week

Minimum 40 hrs per week (average) during prime time on TVNZ channels 54.1 hrs per week 40 hrs per week

Average 15hrs per week on TV3 40.0 hrs per week 15 hrs per week

Outside of contractual expectations of NZ On Air, any programme playing on the new digital channels TVNZ 6 and TVNZ 7 that had previously gone to air with captions and still had captions embedded is also screened with captions. This has increased the volume of captioned programmes on TVNZ channels to an average of 206.2 hours per week.

TVNZ has achieved the performance standard through meeting, and in most cases exceeding, the contractual conditions agreed with the funding authority.

*In the case of Te Karere subtitles, three bulletins were not subtitled during the period due to long-term illness which presented staffing issues. On another occasion a file corrupted, resulting in a lack of subtitles for that bulletin.


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e) Transmitting TVNZ programmes to Pacific nations with funding from the Ministry for Culture and Heritage

The transmission funding received by TVNZ is to enable it to transmit programming by satellite to Pacific nations.

TVNZ undertakes to provide a minimum 7.5 hours transmission of TVNZ programming to Pacific nations weekly, such programming to include the daily transmission of ONE News, the weekly transmission of Tagata Pasifika and the transmission of other programmes relevant to the Pacific nations.

There are 20 broadcasters from the following Pacific nations receiving programming:

•CookIslands •Vanuatu

•Samoa •Tuvalu

•USSamoa •Fiji

•Niue •SolomonIslands

•Tonga •MarshallIslands

•Nauru •Kiribati

Total funding received from the Ministry for Culture and Heritage: $607,000.

Total costs of transmission: $530,941. The unspent funding will be carried forward to FY2011 and will be used on repairs and maintenance, newsroom exchanges, two internships and content acquisition.

Programmes Transmitted Hours

ONE News 365.0

Te Karere 116.0

Close Up 74.5

4:30 News 73.0

Waka Huia 33.0

Tagata Pasifika 26.0

I Am TV 25.0

Q&A 23.0

Country Calendar 19.5

Marae 17.0

Praise Be 13.5

Breakfast Weekend 12.0

Asia Down Under 11.0

Mucking In 10.0

Sports (various) 13.5

Polyfest 7.5

Island Wars 6.5

Mitre 10 DIY Rescue 6.0

Just the Job 5.0

Piha Rescue 5.0

Other 15.0

Total Hours 877.0

f) Maintaining non-commercial transmission sites with funding from the Ministry for Culture and Heritage

This funding is to assist the transmission coverage of the TV ONE and TV2 signals to those New Zealand communities that would not otherwise receive a commercially viable terrestrial signal.

The Company operates and maintains 148 non-commercial transmission sites in accordance with the Memorandum of Understanding with the Ministry for Culture and Heritage.

TVNZ undertakes to meet performance standards including the quality of the signal, maintenance and responses to faults, and to provide performance reports at six-monthly intervals. It contracts transmission company Kordia to provide services to discharge these obligations.

The required performance standard was achieved through compliance with covenants contained in the Memorandum of Understanding.

TVNZ incurs annual costs of approximately $17,000,000 for the maintenance and operation of analogue terrestrial transmission including transmission from the non-commercial sites. The estimated annual operating costs of maintaining transmission from the non-commercial sites is approximately $1,550,000.

Total funding received from the Ministry for Culture and Heritage, to subsidise the cost of maintaining transmission from the non-commercial transmission sites, was $1,150,000.


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g) Funding for TVNZ’s two digital channels for the Freeview platform from the Ministry for Culture and Heritage

TVNZ’s digital channels – TVNZ 6 and TVNZ 7 - are supported by a combination of shareholder investment and internal leverage of existing infrastructure and support systems. Shareholder investment funding of $79 million over six years through the Ministry for Culture and Heritage allows TVNZ to operate the channels in an advertising-free environment which, in turn, allows a stronger public broadcasting ethos than would be possible in a fully commercial model.

TVNZ 6 has been operating since September 30th 2007. An initial offering of three distinct strands or sub-brands – Kidzone, TVNZ Family and TVNZ Showcase – was replaced on Sunday 28th June 2009 with a new TVNZ 6 schedule, retaining only the Kidzone sub-brand (extended by two hours), with the remainder of the schedule focusing on ‘shared viewing’ by a family audience.

TVNZ 7 has been operating since March 30th 2008 and focuses on factual and current affairs programming. Since Sunday June 28th 2009 Showcase type programming that formerly formed part of the TVNZ 6 schedule has been integrated into the TVNZ 7 schedule.

The total funding received from the Ministry for Culture and Heritage in FY2010 was $18,000,000. To 30th June 2010 TVNZ had received operational funding to the value of $56,000,000.

Funding received $

FY2007 5,200,000

FY2008 20,800,000

FY2009 12,000,000

FY2010 18,000,000

56,000,000

The following table reconciles the receipt of government funding by fiscal year with the year the revenue was recognised in the income statement.

Funding Year FY2007 FY2008 FY2009 FY2010 Total

$000 $000 $000 $000 $000

Year of recognition

FY2007 1,029 1,029

FY2008 4,171 8,467 12,638

FY2009 12,333 3,850 16,183

FY2010 8,150 9,174 17,324

5,200 20,800 12,000 9,174 47,174

Still to recognise 8,826 8,826

Total Funding 5,200 20,800 12,000 18,000 56,000

The following table breaks down the $17,324,000 recognised in FY2010 by area/activity.

FY2010

Actual Budget

$000 $000

Funding revenue 17,324 21,748

Other revenue 0 0

Total revenue 17,324 21,748

Expenditure

Programme amortisation 12,657 16,570

Other costs 4,667 5,178

Total expenditure 17,324 21,748

Surplus 0 0

In accordance with TVNZ’s accounting policies content costs are only recognised when programmes are transmitted. TVNZ Digital Services have commissioned more programmes than have so far been transmitted.


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g) Funding for TVNZ’s two new digital channels for the Freeview platform from the Ministry for Culture and Heritage (continued)

These commitments are outlined by programming genre in the following table and show that within the period under review $8,653,000 of funding was committed to commissioning local content, and that of this $4,537,000 (52%) has yet to be recognised as those programmes had not been transmitted by 30 June 2010. A lag between commitment and recognition of expenses is normal for commissioned programming.

Indicative Original/Commissioned

Total Costs

Recognised to date

To be Recognised

Programme Genres Commitments $000 $000 $000

Arts/Music 1,449 103 1,346

Children's factual 531 0 531

Current Affairs 3,297 2,672 625

Factual 2,882 847 2,035

Pre School 494 494 0

Total Commissioned Programmes 8,653 4,116 4,537

Local Programming

For the Total Content costs recognised by TVNZ 6 and TVNZ 7 in FY2010, the following table shows the percentage of local content (i.e. New Zealand made content) costs, by genre, as well as the percentage of local costs dedicated to providing original / local production commissions (cumulative to June 30th 2010).

Cumulative Kidzone TVNZ6 TVNZ 7

(0600 - 1600) All Hours All Hours

Genre Comm/All Local All Local/Total Comm/All Local All Local/Total Comm/All Local All Local/Total

Arts / Music n/a n/a 37% 35% n/a n/a

Children’s Drama n/a n/a 0% 0% n/a n/a

Children’s Factual n/a n/a 8% 8% n/a n/a

Current Affairs n/a n/a n/a n/a 41% 40%

Documentary n/a n/a 0% 0% 15% 14%

Drama n/a n/a 0% 3% n/a n/a

Entertainment n/a n/a 0% 1% n/a n/a

Factual n/a n/a 31% 30% 0% 0%

Features n/a n/a 0% 0% n/a n/a

News n/a n/a n/a n/a 43% 42%

Pre-School 97% 89% 17% 17% n/a n/a

Sport n/a n/a n/a n/a 0% 0%

Total 97% 89% 93% 94% 99% 96%

Target Average 70% 70% 70% 70% 70% 70%


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Local Programming (continued)

The table below outlines the percentage, by genre, of total schedule hours dedicated to original / local production commissions, as well as total local and international content (cumulative to June 30th 2010).

Cumulative Kidzone TVNZ6 TVNZ 7

(0600 - 1600) All Hours All Hours

Genre Comm All Local Int'l Comm All Local Int'l Comm All Local Int'l

Arts / Music n/a n/a n/a 1% 2% 1% 2% 2% 0%

Children’s Drama n/a n/a n/a 0% 1% 2% n/a n/a n/a

Children’s Factual n/a n/a n/a 1% 2% 2% n/a n/a n/a

Current Affairs n/a n/a n/a n/a n/a n/a 5% 22% 3%

Documentary n/a n/a n/a 0% 1% 0% 0% 9% 5%

Drama n/a n/a n/a 0% 8% 1% n/a n/a n/a

Entertainment n/a n/a n/a 1% 5% 1% n/a n/a n/a

Factual n/a n/a n/a 4% 11% 3% 0% 11% 2%

Features n/a n/a n/a 0% 0% 0% n/a n/a n/a

News n/a n/a n/a n/a n/a n/a 31% 34% 6%

Pre-School 18% 52% 48% 10% 31% 29% n/a n/a n/a

Sport n/a n/a n/a n/a n/a n/a 0% 0% 7%

Total 18% 52% 48% 18% 62% 38% 38% 78% 22%

Target Average 15% 50% 15% 55% 35% 70%

Awareness and Appreciation

As the digital channels are non-commercial they are not included in the daily ratings analysis carried out by Nielsen TAM. However, TVNZ commissions research to monitor awareness and appreciation of the digital channels.

In the latest survey, conducted in June 2010, results show that public awareness of the digital channels has increased significantly with 67% of New Zealanders aware of TVNZ 6, against 47% at the same time last year, and 60% aware of TVNZ 7, against 39% last year. Perceived public value has also shown a significant increase with personal interest remaining stable.

Objectives

The digital channels have four key objectives, which are aspirational rather than legislative, and in the 2010 fiscal year the channels continued to meet these objectives in a number of ways, as outlined below.

• To extend public service broadcasting beyond that provided by TV ONE and TV2:

The re-broadcast of public service programming and the commissioning and acquisition of high quality pre-school and children’s programmes for broadcast during the day.

Tales from Te Papa, a partnership between TVNZ 6, Te Papa and Vero, took viewers behind-the-scenes at our national museum in a series of 50 mini-documentaries showcasing some of the “hidden treasures” held there.

TVNZ 6’s partnership with the Department of Conservation for the Meet the Locals interstitials continued with specials for Conservation Week and Sea Week among the offerings. A classroom resource for teachers was also released during the year.

For a third year, TVNZ 6 was the screen partner for Outlook for Someday – the sustainability film challenge for young New Zealanders – broadcasting the entries in December.

Use as Directed, a consumer series presenting consumer information in an entertaining and interesting way, debuted on TVNZ 6 in September.

TVNZ 7 continued its focus on news, current affairs and other factual content, broadcasting 78% local content – with more than a third of the schedule comprised of content made specifically for the channel.


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• To extend public service broadcasting beyond that provided by TV ONE and TV2 (continued):

Further series of arts programmes - including The Good Word, New Artland, Talk Talk and The Gravy – were commissioned for TVNZ 7, continuing to serve the needs of this niche audience. Programming celebrating ‘New Zealand Book Month’ also screened during October.

Spotlight on the Economy was a significant undertaking for TVNZ 7 in November with a month of programming that aimed to educate viewers about the economy, both globally and locally, but with a particular emphasis on New Zealand.

Media 7 and Back Benches continued during the year with summer seasons that included heading to the beach for a tour of New Zealand pubs in the case of the latter.

The Ad Show, a programme with an advertising, marketing and PR focus, launched on TVNZ 7 in February.

Unavailable on TV ONE, TVNZ 7 screened the ANZAC Day Dawn Service from Gallipoli.

In a partnership with the TrustPower Community Awards, Volunteer Power is a series that celebrates the work of community volunteers throughout the country.

• To make public service broadcasting content more available through scheduling more of it in prime time:

The time-shifted rebroadcast of programmes across diverse areas of interest, including – among others; Te Karere, Attitude, Praise Be, Rural Delivery, Q & A, Waka Huia and Asia Downunder.

The acquisition and screening of programmes that haven’t recently screened on television - including local drama and children’s drama series and locally produced documentaries and factual programming.

TVNZ 7’s News at 8 continues to offer extended duration and thus more in-depth coverage of the day’s news.

• To strengthen New Zealanders’ sense of national identity by commissioning more original local content:

Highlights of commissioned local content are outlined above. A breakdown of original local content percentages by genre is outlined in the tables on page 71.

• To encourage households to switch from analogue to digital reception by promoting TVNZ channels on Freeview:

As of June 2010, there were 419, 945 Freeview enabled households, equating to an estimated 26.2% of New Zealand homes. This compares to 255,048 homes at the same time last year.

The above mentioned Awareness and Appreciation survey showed the awareness of TVNZ 6 and TVNZ 7 amongst Freeview owners is high but also consistent with last year’s results at 83% and 82% respectively.


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h) Additional goals for each output in FY2010

Crown funded outputs Actual Target

a) Contestable programme funding from NZ On Air 632.8 hoursMinimum 320 hours per annum of local programming on TV ONE and TV2 (subject to success of applications for contestable funding)

b) Programme funding from Te Mangai Paho 821.5 hoursMinimum 150 hours per annum of Maori programming on TV ONE and TV2 and replays of Maori programming on TVNZ 6 and TVNZ 7

c) Funding for programme captioning from NZ On Air

206.2 hours per week (average)Minimum 150 hours per week of programming captioned on TV ONE, TV2, TVNZ 6 and TVNZ 7

d) Transmitting TVNZ programmes to Pacific Nations

877.0 hoursMinimum 390 hours per annum of programming transmitted to the Pacific

e) Maintaining non-commercial transmission coverage

100%Minimum 100% response to reported breakdowns in transmission within seven days (subject to winter weather constraints)

52%

62%

74%

During FY2010 new figures for minimum local content on the digital channels were negotiated with the Ministry for Culture and Heritage, which differ from those published in the Statement of Intent. The revised figures are:

Minimum local content on TVNZ 6

Kidzone = 50%

All TVNZ 6 (0600 – 2400) = 55%

All TVNZ 6 (Peak) = 60%

78% Minimum 70% local content on TVNZ 7

f ) Funding for TVNZ’s two digital channels


74

To the Reader’s of Television New Zealand Limited and Group’s Financial Statements and Statement of Service Performance For the year ended 30 June 2010

The Auditor-General is the auditor of Television New Zealand Limited (the Company) and Group. The Auditor-General has appointed me, Gordon Fulton, using the staff and resources of Ernst & Young, to carry out the audit on her behalf. The audit covers the financial statements and statement of service performance included in the annual report of the Company and group for the year ended 30 June 2010.

Unqualified opinion In our opinion:

• ThefinancialstatementsoftheCompanyandgrouponpages32to63:

• complywithgenerallyacceptedaccountingpracticeinNewZealand;

• complywithInternationalFinancialReportingStandards;and

• giveatrueandfairviewof:

- the Company and group’s financial position as at 30 June 2010; and

- the results of operations and cash flows for the year ended on that date.

• ThestatementofserviceperformanceoftheCompanyandgrouponpages64to73:

• complieswithgenerallyacceptedaccountingpracticeinNewZealand;and

• givesatrueandfairviewof,foreachclassofoutputs:

- standards of delivery performance achieved, as compared with the forecast standards outlined in the statement of forecast service performance adopted at the start of the financial year; and

- actual revenue earned and output expenses incurred, as compared with the forecast revenues and output expenses outlined in the statement of forecast service performance adopted at the start of the financial year.

• BasedonourexaminationtheCompanyandgroupkeptproperaccountingrecords.

The audit was completed on 30 September 2010, and is the date at which our opinion is expressed.

The basis of our opinion is explained below. In addition, we outline the responsibilities of the Board of Directors and the Auditor, and explain our independence.

Basis of opinion We carried out the audit in accordance with the Auditor-General’s Auditing Standards, which incorporate the New Zealand Auditing Standards.

We planned and performed the audit to obtain all the information and explanations we considered necessary in order to obtain reasonable assurance that the financial statements and statement of service performance did not have material misstatements, whether caused by fraud or error.

Material misstatements are differences or omissions of amounts and disclosures that would affect a reader’s overall understanding of the financial statements and statement of service performance. If we had found material misstatements that were not corrected, we would have referred to them in our opinion.

The audit involved performing procedures to test the information presented in the financial statements and statement of service performance. We assessed the results of those procedures in forming our opinion.

Audit procedures generally include:

• determiningwhethersignificantfinancialandmanagementcontrolsareworkingandcanbereliedontoproducecomplete and accurate data;

• verifyingsamplesoftransactionsandaccountbalances;

• performinganalysestoidentifyanomaliesinthereporteddata;

REPORT OF THE AUDITOR-GENERAL


75

• reviewingsignificantestimatesandjudgementsmadebytheBoardofDirectors;

• confirmingyear-endbalances;

• determiningwhetheraccountingpoliciesareappropriateandconsistentlyapplied;and

• determiningwhetherallfinancialstatementandstatementofserviceperformancedisclosuresareadequate.

We did not examine every transaction, nor do we guarantee complete accuracy of the financial statements and statement of service performance.

We evaluated the overall adequacy of the presentation of information in the financial statements and statement of service performance. We obtained all the information and explanations we required to support our opinion above.

Responsibilities of the Board of Directors and the Auditor The Board of Directors is responsible for preparing the financial statements and statement of service performance in accordance with generally accepted accounting practice in New Zealand. The financial statements must give a true and fair view of the financial position of the Company and group as 30 June 2010 and the results of operations and cash flows for the year ended on that date. The statement of service performance must give a true and fair view of, for each class of outputs, the Company and group’s standards of delivery performance achieved and revenue earned and expenses incurred, as compared with the forecast standards, revenue and expenses adopted at the start of the financial year. The Board of Directors’ responsibilities arise from the Financial Reporting Act 1993, the Crown Entities Act 2004 and the Television New Zealand Act 2003.

We are responsible for expressing an independent opinion on the financial statements and statement of service performance and reporting that opinion to you. This responsibility arises from section 15 of the Public Audit Act 2001 and the Crown Entities Act 2004.

Independence When carrying out the audit we followed the independence requirements of the Auditor-General, which incorporate the independence requirements of the New Zealand Institute of Chartered Accountants.

Other than the audit, we have no relationship with or interests in the Company or any of its subsidiaries.

G A Fulton Ernst & Young On behalf of the Auditor-General Auckland, New Zealand

Matters relating to the electronic presentation of the audited financial statements and statement of service performance This audit report relates to the financial statements and statement of service performance of Television New Zealand Limited and group for the year ended 30 June 2010 included on the Television New Zealand Limited and group’s website. Television New Zealand Limited and group’s Board of Directors is responsible for the maintenance and integrity of the Television New Zealand Limited and group’s website. We have not been engaged to report on the integrity of the Television New Zealand Limited and group’s website. We accept no responsibility for any changes that may have occurred to the financial statements and statement of service performance since they were initially presented on the website.

The audit report refers only to the financial statements and statement of service performance named above. It does not provide an opinion on any other information which may have been hyperlinked to or from the financial statements and statement of service performance. If readers of this report are concerned with the inherent risks arising from electronic data communication they should refer to the published hard copy of the audited financial statements and statement of service performance and related audit report dated 30 September 2010 to confirm the information included in the audited financial statements and statement of service performance presented on this website.

Legislation in New Zealand governing the preparation and dissemination of financial information may differ from legislation in other jurisdictions.


76

Current NZ GAAP Previous NZ GAAP

2010 2009 2008 2007 2006

$000 $000 $000 $000 $000

Group Financial Performance

Television advertising revenue 284,275 298,404 315,440 312,824 334,753

Other revenue 71,062 86,382 76,777 62,147 75,037

Total income 355,337 384,786 392,217 374,971 409,790

Net surplus/(deficit) after taxation (26,026) 2,102 19,426 (7,168) 13,302

Dividends 1,472 0 10,301 0 84,525

Group Financial Position

Assets employed:

Current assets 58,419 70,355 76,888 70,342 66,240

Programme rights 47,076 82,181 96,168 114,252 114,801

Property, plant and equipment 114,324 107,395 110,312 105,135 117,752

Deferred tax asset 2,056 11,233 12,323 18,455 7,324

Other non current assets 36,814 21,876 16,501 15,816 6,231

Total assets employed 258,689 293,040 312,192 324,000 312,348

Funds employed:

Share capital 140,000 140,000 140,000 140,000 140,000

Reserves (255) 84 (17) 96 0

Retained earnings 17,310 44,808 42,706 33,581 58,861

Total equity 157,055 184,892 182,689 173,677 198,861

Current liabilities 63,243 117,171 99,675 103,731 62,531

Term liabilities 38,391 2,325 29,828 46,592 50,956

Total funds employed 258,689 304,388 312,192 324,000 312,348

Financial Ratios

EBITDRA*/Core television revenue 11.1% 9.1% 13.6% 8.9% 10.7%

Net surplus after taxation**/equity (average) -15.2% 1.1% 10.9% -4.0% 5.7%

Net surplus after taxation***/equity (average) 3.3% 1.0% 8.3% -1.5% 5.7%

Equity/total assets employed 60.7% 60.7% 58.5% 53.6% 63.7%

Interest cover (times) **** 10.7 12.5 11.5 6.7 217.5

* EBITDRA - earnings before interest, tax, depreciation, amortisation, reorganisation costs, programme amortisation revision and financial instruments/foreign currency gains/(losses).

** As per reported earnings

*** Net surplus after taxation excludes net after tax effect of programme amortisation revision, financial instruments/foreign currency gains/(losses) and income tax changes, (Current NZ GAAP only).

**** Excludes non recurring items and financial instruments/foreign currency gains/(losses), (Current NZ GAAP only).

FIVE YEAR TREND STATEMENTFOR THE YEAR ENDED 30 JUNE 2010


77

ADDITIONAL INFORMATION

Principal ActivityThe Group’s principal activity during the year was television (programme content supply and delivery, production, acquisition of television programmes, and online services).

ShareholdingThe Group is wholly owned by the Crown. The Shareholding Ministers at balance date were:Hon Bill English Minister of FinanceHon Dr Jonathan Coleman Minister of Broadcasting

DirectorsMs Joan Withers was appointed to the board on 1 October 2009. Mr Rob Fenwick’s term ended on 31 October 2009.

AuditorThe Auditor-General is the auditor of the Group in accordance with Section 14 (1) of the Public Audit Act 2001 and has appointed Gordon Fulton of Ernst & Young to act for and on his behalf as auditor in 2010.

General DisclosuresThe following disclosure of interests were made to the Board:

Directors’ DisclosuresGeneral disclosures of interest given by the Company pursuant to Section 211 of the Companies Act 1993 as at 30 June 2010:

Sir John Anderson, KBE Capital and Coast District Health Board Chairman Commonwealth Bank of Australia DirectorHawkes Bay District Health Board CommissionerNew Zealand Cricket Foundation SecretaryNew Zealand Venture Investment Fund ChairmanPGG Wrightson ChairmanWellington International Arts Foundation ChairmanWellington Regional Stadium Trust TrusteeWellington Regional Strategy Committee Chairman

Anne BlackburnCentre for Clinical Research and Effective Practice (CCREP) ChairmanChinese Language Foundation TrusteeForsyth Barr DirectorMeridian Energy Limited DirectorNew Zealand Venture Investment Fund DirectorRoyal New Zealand Ballet ChairmanThe Boardroom Practice Limited AssociateUnitec Council Member (co-opted)Wellington Regional Holdings Limited (and each of its subsidiaries) Director

Bryan GouldNational Centre for Tertiary Teaching Excellence ChairNew Zealand National Commission for UNESCO ChairOpotiki Community Trust TrusteeThe Foundation for Research, Science & Technology Chair

Sir John Goulter, KNZM, JPNgapuhi Asset Holding Company Limited ChairmanNorthland Deepwater GP Limited ChairmanNZ Business & Parliament Trust ChairmanOpua Commercial Estate Limited DirectorPackard House Limited DirectorParaparaumu Airport Limited Chairman


78

ADDITIONAL INFORMATION (CONTINUED)

Directors’ Disclosures (continued)

June McCabeCrown Health Financing Agency DirectorFINSIA – Financial Services Institute of Australasia CouncillorHui Taumata Trust Trustee & Board MemberOpen Wananga Limited DirectorPayworks Limited ChairmanPeace Foundation CouncillorSustainable Prosperity (NZ) Limited DirectorTe Wai o Aotearoa TrusteeTe Wananga o Aotearoa CouncillorTribal Affiliations Ngapuhi Te Rarawa Te Aupouri Ngati Kahu Ngati Kaharau

Joan WithersAuckland International Airport Limited DirectorLouise Perkins Foundation TrusteeMighty River Power Limited Chair

Specific DisclosuresNo specific disclosures were given pursuant to Section 211 of the Companies Act 1993.

Use of Company InformationNo notices have been given to the Board under Section 145 of the Companies Act 1993 with regard to the use of company information received by Directors in their capacity as a Director.

Directors’ Remuneration and BenefitsThe following persons held the office of director of the Company during the year and received the total amount of remuneration and other benefits shown.

Director $

Sir John Anderson, KBE 80,000

Anne Blackburn 40,000

Robert Fenwick 16,667

Bryan Gould 40,000

Sir John Goulter, KNZM, JP 40,000

June McCabe 40,000

Joan Withers 30,000

286,667


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ADDITIONAL INFORMATION (CONTINUED)

Directors’ Indemnity InsuranceThe Company has arranged directors’ and officers’ liability insurance cover with QBE Insurance (International) Limited for $20 million. The 2010 premium (net of GST) was $15,000. This cover is effected for all directors and employees of the Group.

Employee RemunerationEmployee remuneration includes salary, at risk remuneration, payments for projects, programme production, presentation, motor vehicles, employer’s contributions to superannuation and health schemes, redundancy, other compensation on termination of employment and other sundry benefits received in their capacity as employees.

Employees include executives and staff involved in programme production and presentation where applicable.

Employee remuneration in overseas locations has been converted to New Zealand dollars at current exchange rates.

Current Employees

Former Employees

$100,000 to $110,000 46 6

$110,001 to $120,000 33 5

$120,001 to $130,000 23 5

$130,001 to $140,000 17 3

$140,001 to $150,000 12 2

$150,001 to $160,000 8 0

$160,001 to $170,000 13 2

$170,001 to $180,000 12 1

$180,001 to $190,000 0 1

$190,001 to $200,000 3 1

$200,001 to $210,000 0 2

$210,001 to $220,000 2 0

$230,001 to $240,000 2 0

$240,001 to $250,000 1 1

$250,001 to $260,000 3 0

$260,001 to $270,000 1 0

$280,001 to $290,000 1 0

$300,001 to $310,000 1 0

$330,001 to $340,000 1 1

$340,001 to $350,000 1 0

$350,001 to $360,000 1 0

$360,001 to $370,000 2 0

$410,001 to $420,000 1 0

$440,001 to $450,000 1 0

$450,001 to $460,000 0 1

$560,001 to $570,000 1 0

$570,001 to $580,000 1 0

$750,001 to $760,000 1 0

188 31

Employee Compensation on Termination of EmploymentDuring the year $2,169,339 compensation was paid in total to 44 employees whose employment was terminated. Compensation includes redundancy entitlements, payment in lieu of notice and any payments in settlement of disputes.


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CORPORATE GOVERNANCE

THE BOARD Role of the Board In addition to its duties under the Companies Act 1993, the Board, under Section 92 of the Crown Entities Act 2004, must ensure that the Company acts in a manner consistent with its current Statement of Intent and current output agreement.

Each year the Board negotiates the Statement of Intent with its shareholding Ministers. It includes the Company’s objectives, nature and scope of the activities to be undertaken and the performance targets and other measures by which its performance may be judged for the current year and following two years. The Board monitors management’s performance relative to these objectives and targets.

TVNZ’s principal output agreement with the Crown relates to the provision of funding for programming broadcast in accordance with the Company’s Charter. The Board monitors compliance with the Company’s obligations under that agreement.

The full Board met formally 10 times during the financial year.

The Board has delegated day-to-day management to the Chief Executive Officer. Policies are in place that define the individual and collective responsibilities of the Board and management. In particular, the Board has approved specific delegated authorities to enable management to incur expenditure and create binding obligations.

Appointment of Directors Shareholding Ministers make all appointments to the Board, including that of the Chairman. Appointments are for fixed terms not exceeding three years, which may be renewed.

The Board comprises individuals with a wide range of experiences and skills to ensure that all governance responsibilities are completed in a manner consistent with best possible management practice. Profiles of each of the Directors are set out on page 81 of this report.

Board Committees The Board has two standing committees:

Audit and Risk Committee The Audit and Risk Committee met three times during the year.

The Committee assists the Board in fulfilling its responsibilities by providing recommendations, counsel and information concerning its accounting and reporting responsibilities under the Companies Act 1993 and related legislation, and evaluating risk management practices.

During the year membership of the Committee comprised Sir John Goulter (Chairperson), Sir John Anderson, Mr B C Gould, Ms J N McCabe and Ms A Blackburn.

Remuneration and HR Committee The Remuneration and HR Committee met once during the year. Its work is consistent with TVNZ’s obligations to be a good employer under the Crown Entities Act 2004.

In addition to its role of adding value to TVNZ’s human resources’ plans and practices at a strategic level, the Committee approves any movement to the remuneration of the Company’s top

executives and presenters. The Committee also approves the level of any ‘at risk’ payments to be awarded to Executives, based on the Company’s business performance.

TVNZ operates a remuneration system designed to ensure that employees are rewarded for individual performance, for the responsibilities and skills required in their jobs, benchmarked against both external and internal relativities.

At year end, membership of the committee comprised all the members of the Board. The Chair of this committee is Ms A Blackburn.

KEY GOVERNANCE STATEMENTS Business Continuity, Insurance and Risk Management TVNZ has developed Business Continuity Plans for use in any emergency situation facing the Company.

TVNZ maintains a number of insurance policies designed to support the philosophy that, in the event of a disaster, the Company would not be materially affected.

The Company has in place policies and procedures to identify and manage risks. Exposure to foreign exchange and interest rate risk is managed in accordance with a comprehensive Board-approved treasury policy, which sets limits of management authority. Derivative instruments are used by the Company to manage specific business risk; they are not used for speculative purposes.

Editorial Independence TVNZ has in place an editorial protocol that details the duties and responsibilities of TVNZ, its Board and its executives on editorial matters. The principle of editorial independence recognises the importance of isolating control of editorial content from commercial or political influence. This principle is reflected in the Television New Zealand Act 2003 and the Company’s Statement of Intent.

External Auditor The Auditor-General is the Company’s auditor pursuant to Section 14 of the Public Audit Act 2001. The Auditor-General has appointed Mr Gordon Fulton of Ernst & Young to act as external auditor on her behalf in the current financial year.

Legislative Compliance The Company has in place a legislative compliance programme to ensure the Company’s compliance with its various statutory obligations. A biannual review is undertaken, the results of which are reported to the Audit and Risk Committee.

Occupational Safety and Health TVNZ’s Health and Safety policy is to promote excellence in health, safety and welfare by implementing best practice health and safety systems while seeking continuous improvement.

PROGRAMME STANDARDS The Broadcasting Act 1989 places an obligation on the Company for the broadcasting of programmes to comply with the requirements of that Act and with programme codes approved by the Broadcasting Standards Authority. TVNZ as a broadcaster is required to receive and consider formal complaints and to have procedures for investigating them.


81

DIRECTORS’ PROFILES

SIR JOHN ANDERSON KBE, CHAIRMAN (WELLINGTON) Sir John is currently Chairman of PGG Wrightson Limited, Capital & Coast District Health Board, the New Zealand Venture Investment Fund and the Wellington Regional Strategy Committee, Commissioner of the Hawke’s Bay District Health Board and serves as a director on the boards of Commonwealth Bank of Australia and the Wellington Regional Stadium Trust.

Sir John was formerly Chief Executive of the ANZ National Bank until his retirement in 2005, former Chairman of New Zealand Cricket, New Zealand’s representative director on the ICC - positions he held from 1995 until 2008, and former Chairman of the New Zealand Sports Foundation. In 2009 he was awarded the Halberg SPARC Leadership Award.

He has held advisory and governance roles for successive governments through the 1980’s and 1990’s and received the 1990 Commemoration Medal for Services to New Zealand and was knighted in 1994. In 1995 Sir John was awarded NBR “New Zealander of the Year”, in 2003 he received the Deloittes Top 200 Company Award “New Zealand’s Most Visionary Leader” and in 2005 was the inaugural winner of “The Blake Medal”. In 2006 his home town of Wellington awarded him the “Wellington Icon” award for a lifetime of services to business and the community.

JOAN WITHERS (AUCKLAND) Joan Withers is a professional company director who has served on the boards of a number of New Zealand’s largest companies. She also has extensive media experience, serving as CEO of both The Radio Network and Fairfax Media in New Zealand. She retired from full time executive life in mid 2009 and is currently Chair of Mighty River Power, a director of Auckland International Airport Ltd and a director on the advisory board of The Treasury. Joan holds an MBA from the University of Auckland and was the recipient of the 2009 CAANZ Media Excellence Award.

SIR JOHN GOULTER KNZM, JP (PAIHIA) Sir John is former Managing Director of Auckland International Airport Limited. He is a former Chairman of the New Zealand Lotteries Commission and United Carriers Group Limited, as well as being a former Director of the Reserve Bank of New Zealand. He is currently Chairman of Ngapuhi Asset Holding Company Limited, Northland Deepwater GP Limited and The New Zealand Business and Parliament Trust. In 2003 he was inducted as a laureate into the New Zealand Business Hall of Fame and was appointed a Distinguished Companion of the New Zealand Order of Merit for services to Business and the Community. In 2009 his re-designation as a Knight Companion of the New Zealand Order of Merit was approved by Her Majesty the Queen.

ANNE BLACKBURN (AUCKLAND) Anne Blackburn is a banker by professional background, having had earlier careers in journalism and diplomacy. She is currently a Director of a number of businesses in the infrastructure, finance, investment and research sectors. She also holds governance positions in arts and education not-for-profit organisations.

BRYAN GOULD CNZM (OPOTIKI) Bryan Gould was born and educated in New Zealand before winning a Rhodes Scholarship to Oxford, where he gained a postgraduate law degree. He was the Vice-Chancellor of Waikato University for 10 years. He previously served in the UK’s Labour Shadow Cabinet, was a law don at Oxford, and spent a number of years in the British Foreign Office. He was also a presenter and reporter on Thames Television’s former current affairs programme TV Eye.

JUNE McCABE (AUCKLAND) June McCabe is an Auckland-based Director and was formerly with Westpac Banking Corporation. Her career spans both the public and private sector with extensive experience in policy-making, banking and finance. Her governance roles cover a range of sectors including health, education, finance and investment, plus private and not-for-profit enterprises.


82

MAIN LOCATIONS

AUCKLAND Registered Office Television Centre 100 Victoria Street West Auckland 1010 PO Box 3819 Auckland 1140 Tel: 64 9 916 7000 Fax: 64 9 916 7934 tvnz.co.nz

HAMILTON Sales 533 Anglesea Street Hamilton 3204 PO Box 889 Hamilton 3240 Tel: 64 7 957 6300 Fax: 64 7 957 6311

ROTORUA News 5th Floor, Hinemoa Tower 1154 Hinemoa Street Rotorua 3010 PO Box 944 Rotorua 3040 Tel: 64 7 350 2540 Fax: 64 7 350 2543

WELLINGTON Sales Level 6 Prime Property Tower 86-90 Lambton Quay Wellington 6011 PO Box 1752 Wellington 6140 Tel: 64 4 914 5198 Fax: 64 4 914 5140

News & Current Affairs Level 5 Prime Property Tower 86-90 Lambton Quay Wellington 6011 PO Box 1910 Wellington 6140 Tel: 64 4 914 5000 Fax: 64 4 914 5043

Avalon Studios 41 Percy Cameron Street Lower Hutt 5011 PO Box 31444 Lower Hutt 5040 Tel: 64 4 914 5600 Fax: 64 4 914 5888

New Zealand Television Archive Archive Building Avalon Studios Percy Cameron Street Wellington 5011 PO Box 31444 Lower Hutt 5040 Tel: 64 4 914 5316 Fax: 64 4 914 5319 email: [email protected]

CHRISTCHURCH 202 Gloucester Street Christchurch 8013 PO Box 1945 Christchurch 8140

Sales Tel: 64 3 961 8500 Fax: 64 3 961 8555

News Tel: 64 3 961 8585 Fax: 64 3 365 6705

DUNEDIN News 11 Dowling Street Dunedin 9016 PO Box 1070 Dunedin 9054 Tel: 64 3 474 2880 Fax: 64 3 474 2885

SYDNEY News C/- ABC News Level 4, 700 Harris Street Ultimo, NSW 2001 Tel: 61 2 8333 4856 Fax: 61 2 8333 4188

LONDON Europe Bureau 54 Portland Place London W1B 1DY United Kingdom Tel: 44 20 7079 3241 Fax: 44 20 7079 3243

TVNZ also has News representatives in: •Queenstown •NewPlymouth •Napier •NewYork

tvnz.co.nz

Documents

ANNUAL REPORT FINANCIAL YEAR 2010 TVNZ/TVNZ_AR_FY10.pdfTVNZ ANNUAL REPORT FY2010 4 The impact of the recession on media industry revenues globally has been widely publicised, with