Content Page Reference

1. Shareholder Agreement 3

2. Corporate Objectives 4

3. Business Overview 5-6

4. Financial Performance Targets 7

5. Non- Financia l Performance Targets 8

6. Reporting Obligations 9

7. Policy Compliance 10-11

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Statement of Corporate Intent

ORGANISATION: UrbanGrowtll NSW

PERIOD: ComrnenCing 1 July 2.016

Tl1is Statement of Corporate Intent has been r1greeci octwee n:

~ Fi1st Vo l in,:;; '.3ha; .::hoicie'

The Hon. Gladys Berejik!ian MP

UrbanGrowth NSVv rreasurer

on behalf of the Board

& Voti~g Sha! eholcJe, I

The Hon. Dominic Perrottet MP M inister for Finance anci.Servfces

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Statutory Objectives (summarised)

Our Principal Objectives under the Landcom Corporation Act 2001 are:

(a) to be a successf ul business and:

(i) to operate at least as effic1ent!y as comparable businesse::: .. :mel

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

(b) to exl1ibit a sense of social responsib ility

(c) to protect the environment by conducting its operations in comp liance wiU1 the principles or ecoiogicaliy sustainable development

(d) to exhib it a sense of responsib ility towards. regional deve1op1Y1ent

(e) to uncle rta l\e. or assist the Government in undertaki ng. str-ateg1c or comple>-. urban cleveiopment projec;ts

(e) to assist t !1e Government in achieving its uriJan managerne11t ob_iectiv•:::s

(f) to be a responsible developer of land.

The f irst four objectives are generic to all State Owned Corpo t·at ions and the final t!1ree are spec iri c to our organisation.

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We are in the business of staging the delivery of major Urban Transformation projects (for infilllocations) which requires government intervention to deal with market failure, and specific development capability to maximise outcomes for government and the community. Our objectives include:

, Driving increases in supply of housmg and JObs

,.. Strengthening the NSW economv by dE:I ivering worlcl c!ass centres "UI8t attr8ct investment and boost procluctivity

,- Optimis ing public investment in Infrastructure througll integr8ting !anci use ElncJ tJi'lnsport Dlanning

:r Operating on a commercially astute i)C!Sis. seeking a ta1( return fo( Laxpavers

, Promoting public sector innovat ion through collaborating across government, the private sector and tl-,e cornmunity in the delivery of Major Urban Renevt~al Projects

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Our projects are at different stages along the value chain. We are delivering our existing retail portfolio, taking development opportunities to market and creating Urban Transformation projects.

StageO Project

Identification

BUSINESS CASE

Stage 1 Business

case approval

Stage2 Project

Development

Stage3 Master

Planning

PROJECT DELIVERY

Stage4 Delivery

4il -, ...Sw ··' Major Urban Renewal Portfolio

4£U.Q;!.Mi§

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Stage5 Delivery &

legacy

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The figures in the table below ref lect the organisation's business model as it transitions to a Major Urban Transformation Portfolio from retail greenfield development.

Table 1: Annual Financial Performance Targets

Revenue ($M)

Other Revenue ($M)

EBITDA($M)

EBIT ($M)

Operating Profit Before Tax ($M)

Net Profit AfterTax ($M)

Dividend Payout Ratio #

Return on Assets (EBIT 1 Ave Assets)

Return on Equity(NPAT 1 Ave Equity)

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2016-17 Agreed SCI

$M

·989.0

50.1

275.5

473.4

281.7

197.2

0%

28%

27%

2017-18 Forecast

$M

923.5

63.7

140.3

' '" 137.7

151.6

106. 1

0%

13%

12%

2018-19 Forecast

$M

' ·~ .. 658.5 •·""'-

58.7

137.9

135.5

143.7

100.6

0%

12%

10%

The Corporation's non-financial performance targets are about actions to mobilise private sector housing and jobs as measured by dwelling supply and stakeholder feedback.

Table 2: Non-Financial Performance Targets

Key Objectives Non Financial Performance Targets

f?rggress against 20,000 Home Sites Program - We '.Viii continue to measure our p~rformance against the Government's 20,000 Home Sites Program until JW:L~.

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2016-17

-1

2017-18 I

-1

I I

2018-19

-1

During the course of 2016-17, Voting Shareholders will be provided with annual and half yearly reports in addition to continuous monthly updates of f inancia l information to Treasury.

Schedule 1: Reporting Schedule for Voting Shareholders

Statutory reportin requirements

Jul Aug Sept Oct Nov Dec Jan Feb Mar April May Jun

Half year financial report -Annual report

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

Schedule 2: Additional Progress Reports- Available on Request

Additional performance reporting

Oct April

Performance reports* - -* Reports compiled by NSWTreasury, with assistance from UrbanGrowth NSW

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The Board of UrbanGrowth NSW confirms:

(a'! The fi nancial fo recasts includec! in th is Statement of Corpo rate intHJt have been prepared in accorcl::-1nce with tile State Ownecl Corporation Act 1989 and Austra lian Accou nting Standards ancJ the (equirements or the Puo lic Flli<:once an,j Au,Jit Act '1983 and Public Finance and Aud it Regulation 2010

(b) The performance ta rgets with in the SCI are based on and supported by the Corporation's Business Plan.

(c) It wil l provide til e voting shareholders with financial and other inforrnation. includi ng information on major cap ital expenditure. on ::-1

quarterly basis to assess the peti'ormance ag<.-linst commitments in t!1 is SCI and to assess the va lue of the sl<areholders· mvestrnent in tile busi ness

(d) Its asset maintenance pol icies and processes are adeq uate and appropriate to manage attd contro l risks assoc iated with pllys ical assets

(e) All known 'key risks' and 'major ernerging contingent liabilities· which could matel"ialiy impact t!1e current and future results of the Corporation !1ave been disclosed to our Shareholders

(f) Related party interests. which may represent a possible confl ict oF intei"est fo!-Directors 11ave been disc!osed. in accordance witi1 Treasury rv1a nagernent Po licy.

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More particu larly, the Corporation is aware of the following po licies andj or guidelines and wi ll comply with these t o the extent they apply to UrbanGrowth NSW:

Commercial Policy Framework poli cies. as lisleci i11 St<:1te Owned Corporations: App l1cabie TPPs lir"!Cler tile Commercial Policy Framework 2015

NSW Treasury Ci rculars on accoun ting p.)iicv n1 atte rs as iisted in the attachment ·state Owned Corporations Mandatory Accounti ng Pol icies 2015'

Internal Audit and Risk Managernent Po licy are cons1sterH w1tll

standards recommencled fur .L\SX list("d compcm 1es.

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Minl c; ten8i Mcn<ore'lnrlu lil f'J,:, :2012 04 . ;\ppi!ca tion of NSW public Sc·ctor Wages P·)!icv :?.0 11 to State Owne•:l Corporat iuns

Mi ni;~ter i a l Mt;mc r:.'H,dLI!r, No ~.'01.2-08 Use of Biof'ue ls

Ministenal Men1orandurn Nc., ~~013-04 . !rnpiementat ion gLHdeii nes ro:· procure1r•e nL of p11h lic: ly i't:n cleci construct ion se rv ices.

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