Chorus 2017 half year result, report & updated guidance

Chorus Limited
Level 10, 1 Willis Street
P O Box 632
Wellington 6140
New Zealand
Email: company.secretary@chorus.co.nz







STOCK EXCHANGE ANNOUNCEMENT

20 February 2017


Chorus 2017 half year result, report & updated guidance

The following are attached in relation to Chorus’ half year result and report for the
period to 31 December 2016:

1. Media Release
2. Investor Presentation (including updated FY17 guidance)
3. Half Year Report (including financial statements and auditor review report)
4. NZX Appendix 1
5. NZX Appendix 7
6. Letter to investors

Chief Executive Officer Mark Ratcliffe, and Chief Financial Officer Andrew Carroll, will
discuss the half year result by webcast at 10.00am New Zealand time today. The
webcast will be available at www.chorus.co.nz/webcast.



ENDS


For further information:


Nathan Beaumont
Media and PR Manager
Phone: +64 4 896 4352
Mobile: +64 (21) 243 8412
Email: nathan.beaumont@chorus.co.nz

Brett Jackson
Investor Relations Manager
Phone: +64 4 896 4039
Mobile: +64 (27) 488 7808
Email: brett.jackson@chorus.co.nz

---

Chorus Limited
Level 10, 1 Willis Street
P O Box 632
Wellington 6140
Email: company.secretary@chorus.co.nz

MEDIA RELEASE

20 February 2017


Chorus interim FY17 result: Increasing focus on helping Kiwis switch to
better broadband
 Net profit after tax $66m
 EBITDA
*
$335m
 Updates to EBITDA and capex guidance
 Interim dividend of 8.5cps
 Total fixed lines decreased by 49,000; broadband connections decreased by 12,000

Chorus today reported net profit after tax (NPAT) for the six months ended 31 December 2016
of $66 million (HY16 $33 million). Earnings before interest, tax, depreciation and amortisation
(EBITDA) were $335 million (HY16 $275m). The increases in net profit and EBITDA were
mostly due to the effect of regulated copper price changes, a changed capitalisation approach
and careful management across expense lines.
Operating revenues were $529 million and operating expenses were $194 million.
Chorus chief executive Mark Ratcliffe said the six month period was a particularly busy time
due to Chorus’ ongoing focus on delivering better broadband for customers.
“Fibre has well and truly hit its tipping point in becoming the broadband product of choice for
customers. Between July and December we built 67,000 new fibre connections nationwide, up
from 55,000 in the six months prior, and the average time customers wait for a fibre
connection reduced from 17 days to 10 days.
“With one in three broadband customers now having moved to fibre or a high-speed service
like VDSL, we believe it’s time for us to do more to raise New Zealanders’ awareness of the
better broadband choices that exist today.
“It’s our intention to bolster the support we offer retailers in migrating customers to our fibre
network where it’s available, or to VDSL as a fibre-ready transition step in other areas. We’re
also looking at accelerating our fibre rollout plans in some suburbs”, he said.

Operating update
Chorus continues to invest heavily in enabling better broadband for New Zealanders with $302
million of capital expenditure during the six month period. In December, a $5 million
programme to upgrade nearly 100 rural broadband cabinets with fibre optic cable and VDSL
broadband capability was completed. This investment improved the broadband experience
significantly for about 7,000 mostly rural customers.

In urban areas, around 681,000 customers are now within reach of Chorus’ UFB network and
the company is 61% of the way through its UFB build programme. UFB build work was
completed in Queenstown, Whakatane and Waiheke Island during the period. Uptake in Chorus
UFB areas increased from 24% at the end of June to 32% by the end of December.
The improvement in fibre connection wait times was driven by the combination of new field
crews, up from 524 to 611, and increased productivity after an extension of Visionstream’s
responsibility for fibre installations to around 80% of Chorus’ UFB areas. In Auckland, the
average lead time for a fibre connection reduced from 15 days in June to five days in
December.
In January, Chorus announced that it had reached an agreement with the Government to
extend the UFB roll-out to a further 169 areas. This will make fibre broadband available to
approximately 200,000 more homes and businesses beyond the 1.1 million customers in
Chorus’ existing UFB1 areas. Chorus has today reached an initial agreement with
Broadspectrum to design and build the communal network for 145,000 UFB2 premises. A
separate design process is being trialled for the remaining 24,000 premises which will be
tendered later.
Today is Mark Ratcliffe’s last as chief executive of Chorus. Kate McKenzie, a former senior
Telstra executive, will take up the role.

Fixed line performance
The number of connections across Chorus’ network continued to decline with total fixed line
connections decreasing by 49,000 to 1,678,000, while broadband connections decreased by
12,000 to 1,214,000. Largely this reflected local fibre companies continuing to gain market
share in their UFB areas, as well as a marketing push from vertically integrated retailers
seeking to convert their customer base to their own wireless broadband networks and the
seasonal effect of summer holidays, as tertiary students typically disconnect broadband
services.
“While wireless broadband may be a viable option for some low data users in poor broadband
coverage zones, we’re confident that our fixed line network offers the rock solid reliability and
consistent performance that is needed for both broadband and voice services.
“We continue to invest in our copper network and, on average, a customer with a copper
broadband connection is likely to only experience a fault on our part of the network roughly
once every five years. Even then the downtime is typically less than a day,” he said.

Dividend
An interim dividend of 8.5 cents per share will be paid on 4 April 2017 to all shareholders
registered at 5pm on 21 March 2017. The Dividend Reinvestment Plan will apply for the
interim dividend at a discount rate of 3 per cent. Applications to participate must be received
by 5pm (NZ time) on 22 March 2017.

Guidance update

Chorus has updated its guidance to reflect competitive initiatives planned in the next six
months and its changed capitalisation approach.
FY17 EBITDA guidance was increased to a new range of $645 to $665 million, from $625 to
$645 million previously.
FY17 Capex guidance was increased to a new range of $640 to $680 million, from $610 to
$650 previously.
FY17 fibre connections and layer 2 capex was increased to a new range of $270 to $300
million, from $250 to $280 million previously.
The previous guidance ranges for FY17, UFB1 and UFB2 average cost per premises connected
have been increased by $150 to reflect the changed approach in capitalisation.
*EBITDA is a non-GAAP profit measure which provides comparable period on period
information.

ENDS
Chorus Chief Executive, Mark Ratcliffe, and Chief Financial Officer, Andrew Carroll, will discuss
the half year result at a briefing in Wellington from 10.00am (NZ time). The webcast will be
available at www.chorus.co.nz/webcast.
For further information:

Nathan Beaumont
Media & PR Manager
Phone: +64 4 896 4352
Mobile: +64 (21) 243 8412
Email: nathan.beaumont@chorus.co.nz

Brett Jackson
Investor Relations Manager
Phone: +64 4 896 4039
Mobile: +64 (27) 488 7808
Email: brett.jackson@chorus.co.nz

---

FY17 Half Year Result
20 February 2017

•This presentation may contain forward-looking statements regarding Chorus’ future events and financial performance, including
forward looking statements regarding industry trends, regulation and the regulatory environment, strategies, capital
expenditure, the construction of the UFB network, possible business initiatives, credit ratings and future financial and operational
performance. These forward-looking statements are not guarantees or predictions of future performance, and involve known
and unknown risks, uncertainties and other factors, many of which are beyond Chorus’ control, and which may cause actual
results to differ materially from those expressed in the statements contained in this presentation. No representation, warranty
or undertaking, express or implied, is made as to the fairness, accuracy or completeness of the information contained, referred
to or reflected in this presentation, or any information provided orally or in writing in connection with it. Please read this
presentation in the wider context of material published by Chorus and released through the NZX and ASX.
•Except as required by law or the NZX Main Board and ASX listing rules, Chorus is not under any obligation to update this
presentation at any time after its release, whether as a result of new information, future events or otherwise.
•The information in this presentation should be read in conjunction with Chorus’ audited consolidated financial statements forthe
year to 30 June 2016. This presentation includes a number of non-GAAP financial measures, including “adjusted EBITDA”. These
measures may differ from similarly titled measures used by other companies because they are not defined by GAAP or IFRS.
Although Chorus considers those measures provide useful information they should not be used in substitution for, or isolationof,
Chorus' audited financial statements. Refer to the presentation appendices for further detail relating to EBITDA measures.
•This presentation does not constitute investment advice or a securities recommendation and has not taken into account any
particular investor’s investment objectives or other circumstances. Investors are encouraged to make an independent
assessment of Chorus.
2
Disclaimer

Business performance
overview
3
Mark Ratcliffe, Chief Executive Officer

Mark Ratcliffe, CEO
>Connections trends and initiatives5-11
Andrew Carroll, CFO
>Financial results12-15
>Capex 16-17
>FY17 guidance update and summary18-19
>Capital management, dividend, debt20-21
Mark Ratcliffe, CEO
>Customer focus22-23
>UFB2 and regulatory landscape24-25
>Fibre future -bandwidth demand26
> Q and A
Appendices28-33
Agenda
4
H1 FY17 RESULT PRESENTATION

5
HALF YEAR OVERVIEW

6
CONNECTIONS
Fixed line connections
49,000
Broadband connections
12,000
Fixed line connections31 Dec 201630 June 201631 Dec 2015
Baseband copper1,109,0001,221,0001,320,000
Naked copper (UBA/VDSL)207,000197,000180,000
UCLL98,000108,000116,000
SLU/SLES1,0002,0003,000
Baseband IP10,0009,0006,000
Data services over copper9,00010,00011,000
Fibre (mass market + premium business)244,000180,000125,000
Total fixed line connections1,678,0001,727,0001,761,000
Broadband connections31 Dec 201630 June 201631 Dec 2015
Copper UBA (includes naked UBA)784,000900,000972,000
VDSL (includes naked VDSL)199,000159,000139,000
Fibre (mass market)231,000167,000112,000
Total broadband connections1,214,0001,226,0001,223,000
Note: H1 typically subject to
seasonal variation (e.g. tertiary
students disconnect)
H1 FY17 RESULT PRESENTATION

CONNECTION TRENDS -INDICATIVE
7
>Key connection trends H2 FY16 to H1 FY17:
▪non-UFB areas: reduction in connections due to increased wireless footprint and the expected
end of fixed line coverage growth from the Rural Broadband Initiative rollout
▪LFC areas: consistent connection loss primarily as LFCs benefit from migration to fibre
(existing copper broadband and voice only/UCLL customers)
▪Chorus UFB areas: ongoing reduction in voice only lines, primarily due to broadband growth
and UCLL connections migrating to fibre; broadband growth slowed in H1 with seasonal effect
of summer holidays and marketing initiatives from wireless broadband providers
H1 FY17 RESULT PRESENTATION
Non-UFB1 areasLocal Fibre Company
UFB1 areas
Chorus UFB1
areas
TOTAL CHANGE
H1
FY17
Broadband
Coppervoice only
TOTAL
-6,000
-7,000
-13,000
-21,000
-6,000
-27,000
+15,000
-24,000
-9,000-49,000
H2
FY16
Broadband
Copper voice only
TOTAL
+1,000
-5,000
-4,000
-18,000
-8,000
-26,000
+20,000
-24,000
-4,000-34,000

FIBRE ROLLOUT & UPTAKE
8
Total mass market fibre uptake by plan type
0
10
20
30
40
50
60
70
80
90
100
Jun-15Sep-15Dec-15Mar-16Jun-16Sep-16Dec-16
<100Mbps100Mbps200Mbps
GigabitEducationBusiness 100Mbps+
% of
plans
>Rollout 61% complete with 505,000 premises
passed (FY16: 474,000)
681,000customers able to connect
32% uptake with 216,000connections within
UFB deployed footprint (24% uptake and
156,000 connections at 30 June 2016)
84%of H1 net adds were on 100Mbps plans or
higher
62%of mass market fibre plans now >100Mbps
To update
H1 FY17 RESULT PRESENTATION

0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
May-11Nov-11May-12Nov-12May-13Nov-13May-14Nov-14May-15Nov-15May-16Nov-16
Active Connections
Broadband connections by technology
ADSLADSL2+VDSL2Fibre
35% OF CUSTOMERS ON BETTER BROADBAND
H1 FY17 RESULT PRESENTATION
500,000+customers could make the
switch to VDSL or Chorus fibre today

H1 INITIATIVES -COMPLETE
VDSL promo ($80 modem credit) for retailers
network update info to ~7k rural customers
fibrelead times on broadband address checker
Gig plan extended nationwide
entry level fibreset at 50Mbps
WE’RE DOING MORE TO HELP KIWIS SWITCH
H1 FY17 RESULT PRESENTATION
H2 INITIATIVES –TO COME
above the line campaign (April) to make Kiwis
more aware of better broadband options and
reinforce RSP marketing
launching a new RSP programme to motivate
ADSL customers to migrate to Chorus fibre or
VDSL where fibre isn’t feasible
bringing forward certain fibre build
further investment in network capacity and tools
to streamline provisioning

Financial performance
11
Andrew Carroll, Chief Financial Officer
H1 FY17 RESULT PRESENTATION

H1
FY17
$m
H1
FY16
$m
Operating revenue529479
Operating expenses(194)(204)
Earnings before interest, tax,
depreciation and amortisation (EBITDA)
335275
Depreciation and amortisation(164)(161)
Earnings before interest and income tax171114
Net interest expense(78)(67)
Net earnings before income tax9347
Income tax expense(27)(14)
Net earnings for the period 6633
12
INCOME STATEMENT –statutory results
>H1 FY16 Revenues and EBITDA
impacted by initial benchmark
pricing. Revenue would be $538m
on an adjusted basis.
>H1 FY17 Operating expenses and
EBITDA impacted by $10.6m service
desk capitalisation
>Further context is presented later
in this pack and in Appendix A
H1 FY17 RESULT PRESENTATION

13
H1 FY17 RESULT PRESENTATION
CAPITALISATION APPROACH & CPPC GUIDANCE UPDATE
>$10.6m of fibre service desk costs capitalised in H1 FY17 EBITDA (labour $7.2m;
IT costs $3.4m)
▪as signalled in October, we’ve undertaken a review of treatment of fibre provisioning costs given
high fibre uptake. Determined it is appropriate to now capitalise certain labour and IT costs
previously expensed.
▪expect to capitalise about $23m of service desk costs in FY17, or $159 per connection,
subject to connection volumes and actual provisioning costs
▪Note: further capitalisation changes expected in FY18 with likely adoption of IFRS 15
Average costper
premises connected
(CPPC)
Updated guidance
(reflecting changed capitalisationapproach)
Prior guidance
FY17 $1,100-$1,250 (excluding layer 2 and including
standard installations, some non-standard single
dwellings and service desk costs)
$950-$1,100 (excluding layer 2 and including
standard installations and some non-standard
single dwellings)
UFB1$1,050-1,250 (fora standard residential connection,
including layer 2 and service desk costs, and in 2011
dollars) (tracking at top end)
$900-$1,100 (fora standard residential
connection, including layer 2 and in 2011
dollars) (tracking at top end)
UFB2$1,650-$1,850 (in 2017 dollars and including layer 2,
backbone costs for MDUs and rights of way with 10
or fewer premises)
1,500-$1,700 (in 2017 dollars and including
layer 2, backbone costs for MDUs and rights
of way with 10 or fewer premises)

H1 FY17
$m
H1 FY16
$m
Basic copper237230
Enhanced copper127115
Fibre9161
Value Added
Network Services
1817
Field Services4243
Infrastructure1110
Other33
Total529479 *
H1 FY17
$m
H1 FY16
$m
Labour costs38 **38
Provisioning2431
Network maintenance4242
Other network costs1517
IT costs30 **33
Rents, rates and property
maintenance
1313
Regulatory levies76
Electricity77
Consultants11
Insurance22
Other1514
Total194204
Revenue
Expenses
* Revenues in H1 FY16 reflected 5½ months of benchmark copper
pricing
** These costs are impacted by a changed capitalisation approach in
FY17.
14
H1 FY17 RESULT PRESENTATION

Fibrecapex
H1 FY17H2 FY16H1 FY16
UFB communal9110787
Fibre connections & layer 213411590
Fibre products & systems8108
Other fibre connections & growth203116
RBI0616
Subtotal253269217
Coppercapex
Network sustain91811
Copperconnections234
Copper layer212225
Product113
Subtotal244423
>Total gross capex of $302m
Fibre connections & layer 2 reflects
$10.6m capitalised service desk costs and
higher volumes (68,000 in H1 FY17 vs
38,000 in H1 FY16)
Copper layer 2 includes $5m in rural
cabinet upgrades and investment in
bandwidth performance
Common capex reflects resumption in
spend on IT separation and maintenance
programmes post regulatory uncertainty
15
Commoncapex
Informationtechnology161510
Building& engineering services794
Other220
Subtotal252614
TOTAL GROSS CAPEX$302m$339m$254m
H1 FY17 GROSS CAPEX

Fibre connections & layer 2 capexNo. of connections
(vs FY17 estimate)
H1 FY17H2 FY16H1 FY16
Layer 2 (long run programmeaverage of $100
per connection)
N/A$8m$8m$11m
Premium business fibre connections1,100 completed (FY17 estimate: 2,500)$10m$9m$12m
Single dwelling units and apartments
connections
66,800 completed (FY17 estimate:
150,000)
$77m$59m$38m
Backbonebuild: multi-dwelling units and rights
of way
6,200 completed (FY17 estimate: 10,000) $39m$39m$29m
TOTAL$134m$115m$90m
>Cost per premises passed (CPPP): $1,623 vs $1,550 -$1,650 guidance
>Cost per premises connected (CPPC) of $1,141* vs $1,100 -$1,250 guidance
* excludes layer 2 and includes standard installations, some non-standard single dwellings and service desk costs
16
FIBRE CAPEX
H1 FY17 RESULT PRESENTATION

FY17 PRIORFY17 UPDATED
FY17 illustrative capex profile
CommonCopperFibre
60-85
>GROSS CAPEX UPDATED FY17 RANGE: $640-$680m
▪prior range was $610-$650m)
fibre: range increased to reflect capitalisation of service desk
costs (around $23m) and ‘other fibre’ demand and capability
copper: range increased to reflect further investment in
network capability
17
50-65
480-520
$610-$650m
510-550
65-90
50-65
$640-$680m
FY17 EBITDA & CAPEX GUIDANCE UPDATE
>EBITDA UPDATED FY17 RANGE: $645-$665m
▪prior range was $625-$645m
▪around $23m of service desk costs expected to be
capitalised in FY17
▪around $15m of additional competitive initiatives
expected in H2 FY17
H1 FY17 RESULT PRESENTATION

FY17 guidance summary
FY17 updated guidance Prior guidance
Cost Per Premises
Passed (CPPP)
No change$1,550 -$1,650
Cost Per Premises
Connected (CPPC)
$1,100 -$1,250 *
(excluding layer 2 and including standard installations,
some non-standard single dwellings and service desk
costs)
$950 -$1,100
(excluding layer 2 and including standard
installations and some non-standard single
dwellings)
Fibre connections &
layer 2 capex
$270 –$300m *
(based on mass market 150,000 fibre connections,
10,000 backbone builds and 2,500 premium business
fibre connections and including service desk costs)
$250 -$280m
(based on mass market 150,000 fibre connections,
10,000 backbone builds and 2,500 premium business
fibre connections
FY17 Gross capex
-Fibre
-Copper
-Common
$640 –$680m
$510 -$550m
$65 -$90m
$50 -65m
$610 -$650m
$480 -$520m
$60 -$85m
$50 -$65m
FY17 EBITDA$645 -$665m *
* Reflecting changed capitalisation approach
$625 -$645m
18
H1 FY17 RESULT PRESENTATION

Interim dividend of 8.5 cps, fully imputed
–supplementary dividend of 1.5cps payable to non-resident shareholders
–record date: 21 March 2017
–payment date: 4April 2017
–Dividend Reinvestment Plan applies with 3% discount to prevailing market price; open to
New Zealand and Australian resident shareholders who elect to participate by 5pm (NZT) on
22 March 2017
No change to FY17 dividend guidance of 21cps, subject to no material adverse changes in
circumstances or outlook.
The Chorus Board considers that a ‘BBB’ credit rating from S&P or equivalent credit rating is
appropriate for a company such as Chorus. It intends to maintain capital management policies
and financial policies consistent with these credit ratings
During the UFB build programme to 2020, the Board expects to be able to provide shareholders
with modest long term dividend growth from a base of 20cps per annum, subject to no material
adverse changes in circumstances or outlook.
19
CAPITAL MANAGEMENT & FY17 DIVIDEND
H1 FY17 RESULT PRESENTATION

As at
31 Dec 2016
$m
Borrowings1,862
+ PV of CFH debt
securities (senior)
82
+ Net Finance leases145
Sub total2,089
-Cash(155)
Total net debt1,934
Net debt/EBITDA2.9 times
Financial covenants require senior debt ratio
to be no greater than 4.0 times
>At 31 December, debt of $1,862m comprised:
▪Long term bank facilities -$Nil
▪NZ bond $400m
▪Euro Medium Term Notes (NZ$ equivalent at hedged rates) $1,462m
20
DEBT
Term debt profile
NZ
$M
H1 FY17 RESULT PRESENTATION
250
677
400
785
51
51
77
98
35
54
90
111
0
500
20172018201920202021202220232024202520262027202820292030203120322033203420352036
CFH debt securities available
Face value of CFH debt securities issued
EUR EMTN
NZ Bond
GBP EMTN
Available bank lines

Priorities & outlook
21
Mark Ratcliffe, Chief Executive Officer
H1 FY17 RESULT PRESENTATION

22
CUSTOMER FOCUS HAS DELIVERED RESULTS
30%
RESCHEDULES
382
FIELD CREWS
LEAD TIME
12 days
Jan 16
25%
530
16 days
July 16
WIP
SATISFACTION
623
Jan 17
8days
19%
22k
24k
32k
7.3*6.4
* December result shown. Results are based on a 3 month survey average.

0
2000
4000
6000
8000
10000
12000
14000
16000
18000
20000
Jul-15
Aug-15
Sep-15
Oct-15
Nov-15
Dec-15
Jan-16
Feb-16
Mar-16
Apr-16
May-16
Jun-16
Jul-16
Aug-16
Sep-16
Oct-16
Nov-16
Dec-16
Jan-17
Chorus fibre connection activity -all NZ
Connections built and activatedAdditional connections completed
Orders
23
67,000 FIBRE CONNECTIONS BUILT IN H1
(net of cancellations and rejections in the month)
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
6 months12 months18 months24 months30 months36 months42 months
FY12 areasFY13 areasFY14 areasFY15 areasFY16 areas
Fibre demand –orders as a % of fibre available addresses
Time UFB
available
H1 FY17 RESULT PRESENTATION

24
UFB1 + UFB2 SUMMARY
UFB1UFB2TOTAL
Premisesto be passedup to 830,900 (by
December 2019)
up to 168,200 (by December 2024)up to ~1 million
Estimated communal capex
to pass premises
$1.75 to $1.80 billion$370 to $410 million (includes rights
of way with more than 10 premises)
$2.12 to $2.21 billion
CFH funding up to $929 million
50% CFH debt, 50% CFH equity
up to$291million
65% CFH equity, 35% CFH equity
up to $1.22 billion
Customers able to connect
by rollout end
~1.1 million~203,000~1.3 million
UFB2
Indicative
rollout
schedule
FY17FY18FY19FY20FY21FY22FY23FY24FY25Total
Premises to
be passed
05,00026,00033,00029,00023,00025,00021,0006,000168,000
H1 FY17 RESULT PRESENTATION

25
REGULATORY LANDSCAPE
H1 FY17 RESULT PRESENTATION
Fibre (UFB) coverage
75% population coverage by 2020; Chorus ~1.1m customers, LFCs ~400k
85% population coverage by 2024; Chorus ~1.3m customers, LFCs ~430k
Non-UFB (rural)
15% population;
RBI1–complete
RBI2bids due April; $150m funding
Government Discussion Document (10 Feb 2017)
Copper excluded from building block model but significant changes to scope
Chorus only required to provide UBA+UCLFS products from 2020
from 2020, copper services capped at 2019 nationally averaged pricing until 2024
copper services deregulated and Telecommunications Service Obligation removed where fibre availablewith Commission able
to review regulatory approach from 2023
Chorus able to decommission copper where fibre available, subject to conditions (e.g. free fibre installation)
Utility-like building block model to be implemented for fibre
Commerce Commission to institute regulated asset base (RAB) for fibre services by 2020 using unrecovered historic costs
revenue cap with fibre anchor products –voice + 100/20Mbps –set at 2019 pricing with inflation until end of first period (2023)
commercial pricing to apply for unbundled fibre; Commission can review from 2024 with Ministerial approval

A FIBRE FUTURE
26
>Average monthly household data usage was 132GBin January (up from 96GB in Jan 16)
114GB average on copper and 206GB on fibre
0
50
100
150
200
Dec-14Dec-15Dec-16
Average monthly data usage
(GB) per connection
CopperFibreAverage
H1 FY17 RESULT PRESENTATION

Q and A
27

Appendices
28

This appendix provides a high level summary of Chorus’ adjusted EBITDA. It has been prepared on the
basis of the final pricing principle (FPP) determinations effective 16 December 2015 and capitalisation of
service desk costs.
For comparative purposes this flows the pricing through H1 FY16 as though the pricing had changed on 1
July 2015 and the effect of capitalisation of certain labour ($6m) and IT costs ($4m) previously expensed.
Appendix A: Non statutory measure –adjusted EBITDA
Statutory
results
H1 FY16
$m
Add: UBA and
UCLL price
change
$m
Less: transaction
charge price
change
$m
Add: service
desk
capitalisation
$m
Adjusted
H1 FY16
$m
Total operating revenue47965(6)-538
Total operating expenses(204)--10(194)
EBITDA27565(6)10344
29
H1 FY17
$m
Adjusted
H1 FY16
$m%
Total operating revenue529538(1.7)
Total operating expenses(194)(194)-
EBITDA335344(2.6)

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Local Fibre Companies
30
Appendix B: NZ fixed line market

31

0
200
400
600
800
1000
1200
FY16
Adjusted
revenue
FY16
Operating
expenses
Estimated
interest
Estimated
taxation
Estimated
dividend
@21c per
share
FY16 Capex
Appendix C: Illustrative Chorus pre-financing adjusted cash flows
Note: Future capex not reflected in FY16: UFB2 communal
rollout and connections from FY18-FY23 and potential
capex implications of Government’s proposed RBI2 rollout
(bids due April 2017).
Rural Broadband rollout ended FY16.
UFB1 communal rollout ends Dec 2019.
Fibre connection capex subject to demand.
Other fibre, copper, common
(includes full
year of FPP
pricing)
(does not include
depreciation and
amortisation as
non-cash)
(excludes
ineffectiveness)
32
$m

$35.00
$40.00
$45.00
$50.00
$55.00
$60.00
$65.00
$70.00
$75.00
Jul-16Jul-17Jul-18Jul-19
Mass market fibre products
Note: Evolveproducts shown are the core UFB contracted products introduced in 2012.
Accelerateproducts are commercial products introduced by Chorus in mid 2014.
1Gbps plans launched in all UFB areas October 2016.
33
Appendix D: Chorus mass market copper + fibre pricing
Accelerate: 100/20Mbps
Accelerate: 100/50Mbps
Accelerate: 100/100Mbps
Evolve 4: 100/50Mbps
Accelerate: 200/20Mbps
Accelerate: 200/100Mbps
Accelerate: 200/200Mbps
$39.50
$42
$47
$53
Benchmark
pricing
Pricing effective 16
December 2015
UCLL and UCLFS
$23.52Year 1 -$29.75
Year 2 -$30.22
Year 3 -$30.70
Year 4 -$31.19
Year 5 -$31.68
Basic UBA uplift
$10.92Year 1 -$11.44
Year 2 -$11.22
Year 3 -$11.01
Year 4 -$10.83
Year 5 -$10.67
UCLL + UBA =
aggregate Basic
UBA price
$34.44Year 1 -$41.19
Year 2 -$41.44
Year 3 -$41.71
Year 4 -$42.02
Year 5 -$42.35
SLU
$14.21Year 1 -$15.52
Year 2 -$15.70
Year 3 -$15.89
Year 4 -$16.07
Year 5 -$16.26
1Gbps residential
Evolve 1: 30/10Mbps
1Gbps SME

---

Chorus
Half Year Report
For the six months ended 31 December 2016

P. b
Half Year Report
Half year result overview
1 Earnings before interest, income tax, depreciation and amortisation (EBITDA) is a non-GAAP profit measure.
We monitor this as a key performance indicator and we believe it assists investors in assessing the performance
of the core operations of the business.
2
Adjusted to r
eflect the change in regulated copper pricing from 16 December 2015 and the effect of capitalisation
of certain labour and IT costs previously expensed. Refer to Appendix A of the H1 FY17 investor presentation for the
detailed calculation.
CONNECTIONS
FIXED LINE
3%
FY16
1,727,000
HY17
1,678,000
CONNECTIONS
BROADBAND
FY16
1,226,000
HY17
1,214,000
1%
UFB ROLLOUT
57%
FY16
61%
HY17
NET PROFIT
AFTER TAX
$33m
HY16
$66m
HY17
EBITDA
1
$275m
HY16
$335m
HY17
ADJUSTED
2
EBITDA
$344m
2
HY16
$335m
HY17
Operating update 2
Operating results 4
Dividends, equity and capital management 8
Regulatory update 8
Outlook
9
Financial statements 12
Glossary28
Contents

P. 1
Half Year Report
PATRICK STRANGE
Chairman
MARK RATCLIFFE
Managing Director and Chief Executive Officer
Dear Shareholders
The six month period to 31 December 2016 was
a particularly busy time for the company, with
our ongoing focus on delivering better
outcomes for customers highlighted by:
•fibre connection times improving significantly
from an average lead time of 17 days to 10 days
•
r
eaching an agreement with Crown Fibre
Holdings (CFH) to continue to provide free
non-standard residential connections for the
rest of the Ultra-Fast Broadband (UFB) rollout
•
extending the availability of 1 gigabit
(1,000 Megabits per second) fibre services
across our UFB footprint
•completing an investment programme to
upgrade nearly 100 rural broadband cabinets
•increasing our efforts to help retailers
transition more copper broadband customers
to the faster VDSL speeds already available
to many at no additional wholesale cost
•
announcing that the entry level 30Mbps
fibre service for new and existing customers
would be upgraded to 50Mbps to mark our
fifth birthday
•concluding our agreement with the
Government, as announced in January 2017,
to extend the rollout of UFB to approximately
200,000 more customers by the end of 2024.
Net profit after tax for the six months ended
31 December 2016 (HY17) was $66 million
compared to $33 million for the same period in the
prior year, mostly due to the effect of regulated
copper price changes from 16 December 2015,
a changed capitalisation approach impacting
labour and IT costs and careful management
across expense lines. Revenues were $529 million
and earnings before interest, tax, depreciation
and amortisation (EBITDA) were $335 million.
Chorus Board and
Management overview

P. 2
Half Year Report
Revenue was down slightly by 2% compared
to adjusted
3
revenue of $538 million for the
six months to 31 December 2015, as the number
of connections across our network declined,
largely reflecting local fibre companies
continuing to gain more market share in their
UFB network areas. Line loss during the period
was also influenced by a marketing push by
vertically integrated retailers seeking to convert
their customer base to their own wireless
broadband networks and the usual seasonal
effect of summer holidays as tertiary students,
for example, disconnect broadband services.
The reduction in total connections was partially
offset by growth in demand for regional
backhaul and premium business fibre services,
together with ongoing growth in new dwellings
in some centres. Expenses were flat compared
to adjusted
3
expenses for the 31 December
2015 period due to lower provisioning costs,
a changed capitalisation approach impacting
labour and IT costs and careful management
across other expense lines. The net effect was
a slight decrease in EBITDA relative to adjusted
3

EBITDA of $344 million for that same period.
The continuing financial and regulatory stability
afforded by the conclusion of the copper
regulatory process in December 2015 enabled
us to continue extending our debt profile. We
concluded our first ever international bond issue,
with strong demand for our EUR500 million notes.
The return to a period of ‘business as usual’ also
saw Mark Ratcliffe announce his intention to step
down after a distinguished term as our founding
chief executive. In December we announced that
Kate McKenzie, a former senior Telstra executive,
will lead the company from 2017.
1. Operating update
In December we announced we’d completed
a $5 million programme to upgrade nearly
100 rural broadband cabinets with fibre optic
cable and VDSL broadband capability. This
investment improved the broadband experience
significantly for about 7,000 existing customers
and increased the connection capacity at each
cabinet for future growth.
In urban areas, about 681,000 customers are
now within reach of our UFB network and
we’re 61% of the way through the UFB rollout.
Uptake rose to 32% by the end of December
2016, up from 24% at the end of June, with
216,000 connections in our UFB deployed
footprint. Deployment work was completed
in three more areas during the period:
Queenstown, Whakatane and Waiheke Island.
An increase in the number of fibre field crews
from 524 to 611 over the six month period,
enabled us to complete 67,000 new fibre
connections nationwide, up from 55,000
connections in the six months to June 2016.
Moreover, the national weighted average lead
time for a fibre connection reduced from
17 working days in June to 10 days in December.
This was driven by the combination of new
field crews and increased productivity after we
extended Visionstream’s responsibility for fibre
installations to around 80% of our UFB areas.
In Auckland, the average lead time for a fibre
connection reduced from 15 days in June to
five days in December.
Customers also benefitted from our
announcement in October that we’d concluded
an agreement with CFH to continue to provide
free non-standard (i.e. exceeding the standard
3 To reflect the revised regulated copper pricing from 16 December 2015 and the effect of capitalisation of certain labour and
IT costs previously expensed.

P. 3
Half Year Report
distances contemplated in our original UFB
contract) residential fibre installations through
to the end of 2019. We took the pragmatic
approach that a building block model, as
proposed in the Government’s pending
regulatory review, is likely to include the cost of
residential non-standard installations and allow
a regulated return on this investment. In the
event that this hasn’t occurred by the end of
2020, or not all of our actual UFB non-standard
installation costs are included in a regulated
asset base, the dates on which we must redeem
or provide dividends on CFH debt and equity
securities will be postponed. At a maximum, this
would contribute approximately $60 million of
value towards costs incurred from 2017 to the
end of 2019.
DUNEDIN
ASHBURT
ON
TIMARU
INVERCARGILL
MASTERT
ON
WHAKATANE
GISBORNE
KAPITI
WAIHEKE ISLAND
LEVIN
GREY
MOUTH
BLENHEIM
ROTORU
A
WAIUKU
TAUPO
QUEENST
OWN
% o
f build completed (premises)
100
90
80
70
60
50
40
30
20
10
0
% of build complete December
UFB uptake December
Chart shows consumer uptake as a proportion of UFB capable addresses (i.e. network is commissioned for service)
OAMARU
NELSON
PALMERSTON NORTH
PUKEKOHE
NAPIER/HASTINGS
AUCKLAND
WELLINGT
ON
FEILDING
30
40
35
45
50
25
15
20
10
5
0
BUILD COMPLETE
32% UFB UPTAKE
Uptak
e r
ela
tive to capable addresses (%)
Figure 1: Chorus UFB uptake by Area – December 2016

P. 4
Half Year Report
2. Operating results
2.1 Operating revenue
Revenues of $529 million were slightly down
compared to adjusted revenue of $538 million
for the six months to 31 December 2015.
Total fixed line connections reduced by
49,000 lines to 1,678,000 in the six months
to 31 December 2016. Broadband connections
reduced by 12,000 to 1,214,000. The revenue
impact of falling copper line connections was
partially offset by the migration of some
connections to our other fixed line products,
particularly fibre, and growth in field services
revenue. All other revenue lines remained
largely flat.
Copper
At 31 December 2016, there were approximately
1,109,000 baseband copper lines, a decrease of
112,000 lines from 30 June 2016. The number of
unbundled lines (including sub-loop unbundled
lines) declined by 10% to 99,000.
Uptake of VDSL broadband continued to grow,
up from 159,000 at 30 June 2016 to 199,000 by
31 December 2016 as we encouraged retailers to
promote the availability of our expanded VDSL
footprint to customers. While we do not charge
retailers more for a faster VDSL service, many
had been reluctant to upgrade their customers
from standard ADSL broadband due to modem
costs. We therefore began providing an $80
contribution (over 12 months) to this cost outside
of Chorus UFB areas and waiving transfer
charges. From 1 January 2017 this contribution
was increased to $100 (over six months).
‘Data service over copper’ connections continued
to decline as retailers transitioned customers
to cheaper inputs. Baseband IP connections
grew slightly.
Fibre
Nationwide fibre connections increased by
more than a third in the first half, from 180,000
to 244,000 lines. We had approximately 216,000
fibre connections within the areas where
we had deployed UFB communal network
at 31 December 2016, up from 156,000
connections at 30 June 2016. Customers
continued to favour higher speed fibre plans
over the entry level 30Mbps plan, with 84%
of connections during the period opting for
100Mbps or greater. By 31 December 2016
approximately 62% of mass market fibre
connections were on plans of 100Mbps or
greater, up from 54% at the start of the period.
From October, one gigabit per second (1Gbps)
residential and small-medium business fibre
broadband services were made available across
our entire UFB footprint. This followed on from
our launch of the service in Dunedin in early
2015 when they won our Gigatown competition.
At 31 December we had about 8,500 1Gbps
customers across the wider UFB network.
To mark our fifth birthday as a standalone
company, in December we announced that
we would replace the entry level 30Mbps
fibre service with a 50Mbps service at no extra
wholesale charge. This is to ensure fibre is better
differentiated from our VDSL copper broadband
service which has average peak speeds of
about 50Mbps.
Premium business fibre connections remained
stable at 13,000 connections. Increased demand
for High Speed Network Service and Direct Fibre
connections was partially offset by declines in
Bandwidth Fibre.

P. 5
Half Year Report
Value added network services
Revenue for this category increased as retailers
expanded their backhaul requirements,
particularly on regional transport links.
Infrastructure
Revenue for providing access to our network
assets (e.g. renting exchange space, providing
power) increased slightly as retailers expanded
their network requirements.
Field services
Field services revenue increased relative to
adjusted revenue as third party demand for
technician maintenance and provisioning
services grew, as well as greenfields and
subdivision related work.
2.2 Operating expenses
Expenses of $194 million for the six months
to 31 December 2016 were flat compared
to adjusted expenses for the six months to
31 December 2015 due to lower provisioning
costs, the impact of the capitalisation of certain
service desk costs ($7.2 million labour costs,
$3.4 million IT costs) and careful management
across other expense lines.
Labour costs
Labour costs of $38 million represent staff costs
that are not capitalised. At 31 December 2016
we had 963 permanent and fixed term
employees, up from 944 employees at 30 June
2016. A further 14 people were employed in the
customer services area, reflecting growth in fibre
Chorus summary connection facts
CONNECTIONS
31 DEC 2016
CONNECTIONS
30 JUNE 2016
CONNECTIONS
31 DEC 2015
Total fixed line connections
1,678,0001,727,0001,761,000
Baseband copper1,109,0001,221,0001,320,000
UCLL98,000108,000116,000
SLU/SLES1,0002,0003,000
Naked Copper (UBA / VDSL)207,000197,000180,000
Baseband IP10,0009,0006,000
Data services over copper9,00010,00011,000
Fibre (mass market + premium business)244,000180,000125,000
Total broadband connections
1,214,0001,226,0001,223,000
Copper UBA (includes naked UBA)784,000900,000972,000
VDSL (includes naked VDSL)199,000159,000139,000
Fibre (mass market)231,000167,000112,000

P. 6
Half Year Report
volumes and the continued focus on improving
the customer experience, with a significant
proportion of their costs being capitalised. An
additional seven people joined the information
technology team to continue to develop the
systems and processes across the organisation.
The number of people throughout the
remainder of the business has remained
relatively stable.
Provisioning costs
Provisioning costs are incurred where we provide
new or changed service to our customers.
The total provisioning cost is driven by the
volume of orders, the type of work required
to fulfil them such as technician labour, material
and overhead costs. Field provisioning costs have
declined as fibre uptake increased and fewer
truck rolls were required for copper services.
The average cost per truck roll decreased as we
simplified provisioning processes and customers
ordered less connections requiring premises
visits. In addition, outsourcing costs were incurred
for a trial installation support service to manage
the customer ordering experience.
Network maintenance costs
Network maintenance costs were stable
compared to HY16 with a slight increase in
overall fault volumes being offset by a lower
average cost per fault. The increase in faults was
driven by a combination of increasing faults in
non-Chorus network (i.e. faults in retailer and
customer equipment or wiring, which is
chargeable to the retailer), higher fibre faults in
line with increased fibre connections and a slight
increase in our copper network faults. The cost
per fault reduced because of a higher proportion
of lower cost non-Chorus network faults and
ongoing compliance programmes.
Information Technology
We have mitigated inflationary cost growth and
are seeing cost reductions from new IT support
contracts from recent investments. In addition,
the costs associated with supporting the
provisioning process have been more clearly
defined and included in the capital cost of new
connections.
2.3 Depreciation and amortisation
Depreciation has continued to increase
slightly, reflecting the capitalisation of UFB
assets and the very long lives of these assets.
The amortisation of Crown funding against
these assets is increasing and offsetting the
increase in depreciation.
2.4 Finance expenses
Interest on debt (EMTN, fixed rate NZD bonds
and syndicated bank facilities) has decreased
in the current period, reflecting the move to
cheaper funding. For accounting purposes,
the ineffective portion of the EMTN (GBP) hedge
relationship resulted in a non-cash credit of
$1 million to finance expense in HY17.
Also included in finance expense is $6 million
of non-cash costs relating to a $250 million
interest rate swap which is not currently in a
hedging relationship for accounting purposes
and $6 million of non-cash costs relating to the
change in fair value of the EMTN (EUR) hedge.
The ongoing direction and rate of impact on
the income statements cannot be predicted
for either of these two items.

P. 7
Half Year Report
2.5 Capital expenditure
Gross capital expenditure for the six months
to 31 December 2016 was $302 million.
This included $91 million for the rollout
of the UFB communal network, with a further
31,000 premises passed. The average cost per
premises passed in the period was $1,623,
within FY17 guidance of $1,550 to $1,650.
Fibre connections and layer 2 spend was
$134 million, reflecting the ongoing strength
of fibre demand both within our UFB rollout
areas and beyond. We built new fibre
connections to 67,000 customers nationwide
in the six month period. The average cost per
premises connected for standard residential
premises and some non-standard single
dwelling unit connections was $1,141 excluding
the long run average cost of layer 2 equipment.
This cost now also includes $159 of capitalised
labour and IT costs relating to certain fibre
provisioning service desk costs that were
previously expensed.
In October we announced that we expect to
track at the top end of the total UFB programme
view for the average cost to connect standard
residential premises of $900 to $1,100 in 2011
dollars. This reflects higher mobilisation costs in
a time of relatively full employment and higher
than expected fibre uptake. We expect to be able
to hold average connection costs per unit flat in
nominal terms across the term of this contract
rather than secure further economies in
connection costs. This range has now been
updated to $1,050 to $1,250 in 2011 dollars to
include the capitalisation of certain labour and
IT costs.
As noted above, we agreed with CFH that we
would continue to fund non-standard residential
connections on the basis that these costs are
likely to be recognised in the future regulatory
framework. In the event that this hasn’t occurred
by 31 December 2020, or not all of our actual
UFB non-standard installation costs are included
in the asset base, the dates on which we
must redeem or provide dividends on the CFH
debt and equity securities will be postponed.
At a maximum, postponement would contribute
approximately $60 million of value towards
non-standard installation costs incurred from
2017 to the end of 2019.
Copper capital expenditure was $24 million
for the period. This was in line with the same
period in FY16 and included $5 million invested
in rural cabinet upgrades. Demand for infill
copper connections continues to reduce
as fibre becomes more widely available.

P. 8
Half Year Report
3. Dividends, equity and capital
management
We will pay an interim dividend of 8.5 cents per
share on 4 April 2017 to all holders registered at
5:00pm 21 March 2017. The dividends paid will
be fully imputed, at a ratio of 28/72, in line with
the corporate income tax rate. A supplementary
dividend of 1.5 cents per share will be payable
to shareholders who are not resident in
New Zealand.
The dividend reinvestment plan will apply for
the interim dividend at a discount rate of 3%.
Shareholders who have previously elected to
participate in the dividend reinvestment plan do
not need to take any further action. For those
shareholders who wish to participate, election
notices to participate must be received by
5:00pm (NZ time) on 22 March 2017.
A final dividend of 12.5 cents per share will be
declared in August 2017, subject to no material
adverse changes in circumstances or outlook.
The Board considers that a ‘BBB’ or equivalent
credit rating is appropriate for a company like
Chorus. It intends to maintain capital management
policies and financial policies consistent with these
credit ratings. At 31 December 2016 we had a long
term credit rating of BBB/stable outlook by
Standard & Poor’s and Baa2/stable by Moody’s
Investor Services.
In October we completed another significant
step in extending the duration of our debt
portfolio with a EUR500 million notes issue
under our Euro Medium Term Note (EMTN)
programme. This was our first international
bond issue since demerger and followed our
$400 million domestic bond issue in May 2016.
The Euro notes have been fully swapped to
NZD785 million and the net proceeds have been
used to repay Chorus’ existing bank facilities
and for other general corporate purposes.
4. Regulatory update
4.1 Government review of 2020 regulatory
framework
The Government issued an options paper in
July 2016 that continued to propose and prefer
a building block model as the most appropriate
regulatory framework for our copper and fibre
access services from 2020. We and some of our
investors, as well as various industry members,
made submissions on the Discussion Document.
On 10 February 2017 the Government released a
further Discussion Document which sets out final
views on the approach to Chorus fibre services,
and new proposals for copper services for
feedback. The Government has departed from the
previous combined copper and fibre regulated
asset base proposal. The key changes are:
• The final decision is that Chorus fibre will be
regulated under a traditional utility style
building block model framework. The initial
valuation of the Chorus fibre network will be
determined by the Commerce Commission
(the Commission) based on unrecovered
historic costs. For an initial period until 2023,
Chorus will be regulated under a revenue cap
with anchor products. The price of the initial
voice and broadband anchor product
(100/20Mbps) will be set based on 2019
prices, adjusted for inflation. The form of
control can be reviewed by the Commission
from 2024, subject to approval by the
Minister. Unbundling is required with prices
set commercially until 2024, when the
Commission can investigate whether or not
prices should be set on a cost-oriented basis.

P. 9
Half Year Report
• The proposal is that copper will be de-
regulated and the Telecommunications
Service Obligation (TSO) will be removed
where UFB or other fibre is available.
• In other copper areas, prices will be set at
2019 prices with no inflation adjustment
and the TSO will remain in place.
The proposal to treat copper and fibre separately
in the regulatory framework raises some additional
complexity for regulatory implementation, such
as cost allocation, that we will need to consider
carefully. If legislation is passed in 2017 in line
with previous Government statements, it will
need to be implemented by the Commission
in time for 2020.
4.2 Other regulatory matters
In November 2016 the Commission announced
its draft decision in its review of the non-price
terms of the Unbundled Bitstream Access (UBA)
standard terms determination. The Commission
has proposed that we be required to maintain
congestion free links on our Ethernet network
and that it will regulate the pricing of 10GigE and
multiple 1GigE handovers. These proposals are
largely consistent with our current practices.
A final decision is expected in March.
In December 2016 the Commission determined
that we were liable for $11 million of the
$50 million Telecommunications Development
Levy for the financial year ending 30 June 2016.
The levy is based on annual revenues.
5. Outlook
5.1 Change in leadership
Having skilfully navigated through the
establishment of Chorus and some tumultuous
years, Mark steps down knowing the fibre rollout
is going well, the company is in a strong position
and it has been recognised as one of the best
employers in Australasia for five consecutive
years. The Board offers him their best wishes
and thanks for a job well done.
We’re very pleased that Kate McKenzie has
agreed to now lead Chorus. She is one of the
most highly rated telecommunications
executives in the region and was most recently
Telstra’s Chief Operations Officer, responsible
for Telstra’s field services, IT and network
architecture and operations. Prior to that,
she was Group Managing Director, Innovation,
Products and Marketing. Other previous roles
at Telstra include Group Managing Director,
Wholesale, and Group Managing Director,
Regulatory, Public Policy and Communications.
Before joining Telstra, Kate was Director-General
of the Department of Commerce in New South
Wales. She has experience in the development
and implementation of competition policy,
energy reform, privatisation and a range of
complex Commonwealth/State negotiations.

P. 10
Half Year Report
5.2 UFB2 – taking fibre further
We have underlined our belief in fibre’s long
term future by announcing in January 2017
that we had reached an agreement with the
Government to extend the UFB rollout to a
further 169 areas, from Taipa–Mangonui in
Northland to Bluff in Southland. This will make
fibre broadband available to approximately
200,000 more homes and businesses beyond
the 1.1 million customers in Chorus’ existing
UFB rollout areas. Fibre will future-proof these
communities for the anticipated continued
growth in data consumption and help increase
jobs, income and investment in regional
New Zealand. We expect work to commence
in July 2017 and finish by December 2024
and we’ll endeavour to make recent earthquake
hit areas in the South Island a priority.
We believe it is in the long term interests of
shareholders to take fibre further because fibre
has clearly become the preferred broadband
product of choice for customers. Uptake in the
areas we completed in the first year of the
rollout has surpassed 40% and orders received
in our FY16 build areas have already reached
35% of possible demand within 18 months.
Crown Fibre Holdings is providing up to
$291.3 million in additional funding to help
make the business case for us to extend fibre
to these new areas sooner than would have
otherwise occurred and on terms similar to
the existing UFB rollout. The Government has
contracted with other local fibre companies
to extend fibre to about 33,000 premises and
will provide $16 million in funding.
We estimate the cost of our additional UFB
communal network will be $370 million to
$410 million. In addition to the communal
network, the cost to connect each of the
203,000 potential customers within this
footprint is estimated to average $1,650 to
$1,850 (in 2017 dollars and including layer 2,
service desk costs, backbone costs for MDUs
and rights of way with 10 or fewer premises).
5.3 Customer focus continues
Our focus on improving the fibre installation
experience for customers will continue, along
with greater emphasis on promoting customer
awareness of our network availability and
services, particularly VDSL broadband in areas
where we haven’t yet deployed fibre. This is in
response to some apparent customer confusion
about our copper network availability and
performance relative to wireless broadband
options. While wireless broadband may be a
viable option for some low data users in poor
broadband coverage zones, we’re confident
that our fixed line network offers solid reliability
and consistent performance both for voice
and broadband. The latter is particularly
apparent during peak broadband usage
hours and we note that a wireless broadband
retailer has recently branched out from its core
mobile offering to promote an unlimited data
service on the fixed line network.

P. 11
Half Year Report
We are supporting retailers leveraging our
network to deliver better broadband to
customers. Bandwidth demand is increasing
rapidly and we are investing in a congestion
free network as well as simplifying the ways
retailers interconnect with our systems and
network. The proposed merger between
Vodafone and Sky TV, which the Commission
is due to decide on in late February, may lift
bandwidth consumption further again if it leads
to more content delivery online.
We may see more network competition emerge
in rural areas with the Government seeking
tenders in April for $150 million in grants to
extend rural broadband coverage and provide
coverage of mobile black spots. We expect to
submit a proposal that builds on our experience
in delivering the G
overnment’s first Rural
Broadband Initiative rollout, but will need
to consider aspects of the Government’s
10 February regulatory announcement which
raises questions around incentives for ongoing
investment in the high cost rural areas currently
served by copper. We look forward to engaging
further on this, to ensure that customer needs
are met, along with consideration of whether
investors can earn a fair return.
PATRICK STRANGE MARK RATCLIFFE
Chairman Managing Director and
Chief Executive Officer
20 February 2017

P. 12
Half Year Report
Half Year Report
Financial Statements
For the six months ended 31 December 2016
P. 12

P. 13
Half Year Report
Condensed consolidated income statement
FOR THE SIX MONTHS ENDED 31 DECEMBER 2016
(DOLLARS IN MILLIONS)NOTE
SIX MONTHS
ENDED
31 DEC 2016
UNAUDITED
$M
SIX MONTHS
ENDED
31 DEC 2015
UNAUDITED
$M
YEAR
ENDED
30 JUNE 2016
AUDITED
$M
Basic copper 237 230 489
Enhanced copper 127 115 242
Fibre 91 61 133
Value added network services 18 17 35
Infrastructure 11 10 20
Field services 42 43 83
Other 3 3 6
Total operating revenue
529 479 1,008
Labour costs (38) (38) (78)
Provisioning (24) (31) (60)
Network maintenance (42) (42) (89)
Other network costs (15) (17) (34)
Information technology costs (30) (33) (65)
Rent and rates (8) (8) (16)
Property maintenance (5) (5) (12)
Electricity (7) (7) (14)
Insurance (2) (2) (3)
Consultants (1) (1) (4)
Regulatory levies (7) (6) (13)
Other (15) (14) (26)
Total operating expenses
(194) (204) (414)
Earnings before interest, income tax,
depreciation and amortisation
335 275 594
Depreciation (132) (129) (263)
Amortisation (32) (32) (64)
Earnings before interest and income tax
171 114 267
Finance income
6 4 7
Finance expense8
(84) (71) (147)
Net earnings before income tax
93 47 127
Income tax expense (27) (14) (36)
Net earnings for the period
66 33 91
Earnings per share
Basic earnings per share (dollars)0.17 0.08 0.23
Diluted earnings per share (dollars)0.14 0.07 0.19

P. 1 4
Half Year Report
Condensed consolidated statement
of comprehensive income
FOR THE SIX MONTHS ENDED 31 DECEMBER 2016
(DOLLARS IN MILLIONS)
SIX MONTHS
ENDED
31 DEC 2016
UNAUDITED
$M
SIX MONTHS
ENDED
31 DEC 2015
UNAUDITED
$M
YEAR
ENDED
30 JUNE 2016
AUDITED
$M
Net earnings for the period
66 33 91
Other comprehensive income
Items that will be reclassified subsequently to
profit and loss when specific conditions are met
Ineffective portion of changes
in fair value of cash flow hedges
(1) 1 7
Effective portion of changes
in fair value of cash flow hedges
9 (9) (29)
Amortisation of de-designated cash flow
hedges transferred to income statement
(1) (1) (1)
Other comprehensive income net of tax
7 (9) (23)
Total comprehensive income
for the period net of tax
73 24 68

P. 15
Half Year Report
Condensed consolidated statement of financial position
AS AT 31 DECEMBER 2016
(DOLLARS IN MILLIONS)NOTES
31 DEC 2016
UNAUDITED
$M
31 DEC 2015
UNAUDITED
$M
30 JUNE 2016
AUDITED
$M
Current assets
Cash and call deposits 155 78 102
Income tax receivable - - 3
Trade and other receivables 173 184 158
Derivative financial instruments - - 1
Finance lease receivable 4 3 4
Total current assets
332 265 268
Non-current assets
Derivative financial instruments - 7 -
Trade and other receivables 10 11 10
Software and other intangibles2 143 149 160
Network assets1 3,811 3,500 3,656
Total non-current assets
3,964 3,667 3,826
Total assets
4,296 3,932 4,094
Current liabilities
Trade and other payables 345 321 347
Income tax payable 7 9 -
Derivative financial instruments 58 29 24
Debt3 - 465 -
Total current liabilities excluding Crown funding
410 824 371
Current portion of Crown funding5 18 14 17
Total current liabilities
428 838 388
Non-current liabilities
Derivative financial instruments 214 90 191
Finance lease payable 150 131 136
Debt3 1,597 1,172 1,540
Deferred tax payable 194 198 194
Total non-current liabilities excluding
CFH and Crown funding
2,155 1,591 2,061
CFH securities4 165 118 152
Crown funding5 629 542 622
Total non-current liabilities
2,949 2,251 2,835
Total liabilities
3,377 3,089 3,223
Equity
Share capital 504 465 481
Reserves(19)(12)(26)
Retained earnings 434 390 416
Total equity
919 843 871
Total liabilities and equity
4,296 3,932 4,094

P. 16
Half Year Report
Condensed consolidated statement of changes in equity
FOR THE SIX MONTHS ENDED 31 DECEMBER 2016
(DOLLARS IN MILLIONS)
SHARE
CAPITAL
$M
RETAINED
EARNINGS
$M
CASH FLOW
HEDGE RESERVE
$M
TOTAL
$M
Balance at 1 July 2015
465 357 (3) 819
Comprehensive income
Net earnings for the year - 91 - 91
Other comprehensive income
Ineffective portion of changes in fair value
of cash flow hedges
- - 7 7
Effective portion of changes in fair value of
cash flow hedges
- - (29) (29)
Amortisation of de-designated cash flow
hedges transferred to income statement
- - (1) (1)
Total comprehensive income
- 91 (23) 68
Contributions by and (distributions to) owners:
Dividends - (32) - (32)
Supplementary dividends - 3 - 3
Tax credit on supplementary dividends - (3) - (3)
Dividend reinvestment plan 17 - - 17
Employee share plan (1) - - (1)
Total transactions with owners
16 (32) - (16)
Balance at 30 June 2016 (AUDITED)
481 416 (26) 871
Comprehensive income
Net earnings for the period - 66 - 66
Other comprehensive income
Ineffective portion of changes in fair value
of cash flow hedges
- - (1) (1)
Effective portion of changes in fair value of
cash flow hedges
- - 9 9
Amortisation of de-designated cash flow
hedges transferred to income statement
- - (1) (1)
Total comprehensive income
- 66 7 73
Contributions by and (distributions to) owners:
Dividends - (48) - (48)
Supplementary dividends - 5 - 5
Tax credit on supplementary dividends - (5) - (5)
Dividend reinvestment plan 23 - - 23
Total transactions with owners
23 (48) - (25)
Balance at 31 December 2016 (UNAUDITED)
504 434 (19) 919

P. 17
Half Year Report
(DOLLARS IN MILLIONS)
SHARE
CAPITAL
$M
RETAINED
EARNINGS
$M
CASH FLOW
HEDGE RESERVE
$M
TOTAL
$M
Balance at 1 July 2015
465 357 (3) 819
Comprehensive income
Net earnings for the period - 33 - 33
Other comprehensive income
Ineffective portion of changes in fair value
of cash flow hedges
- - 1 1
Effective portion of changes in fair value of
cash flow hedges
- - (9) (9)
Amortisation of de-designated cash flow
hedges transferred to income statement
- - (1) (1)
Total comprehensive income
- 33 (9) 24
Balance at 31 December 2015 (UNAUDITED)
465 390 (12) 843

P. 18
Half Year Report
Condensed consolidated statement of cash flows
FOR THE SIX MONTHS ENDED 31 DECEMBER 2016
(DOLLARS IN MILLIONS)
SIX MONTHS
ENDED
31 DEC 2016
UNAUDITED
$M
SIX MONTHS
ENDED
31 DEC 2015
UNAUDITED
$M
YEAR
ENDED
30 JUNE 2016
AUDITED
$M
Cash flows from operating activities
Cash was provided from/(applied to):
Cash received from customers
548 474 1,003
Finance income 4 2 3
Payment to suppliers and employees (226) (216) (404)
Taxation paid (20) (15) (47)
Interest paid (56) (62) (120)
Net cash flows from operating activities
250 183 435
Cash flows applied to investing activities
Cash was provided from/(applied to):
Purchase of network assets and software
and intangible assets
(307) (258) (569)
Capitalised interest paid (2) (3) (5)
Net cash flows applied to investing activities
(309) (261) (574)
Cash flows from financing activities
Cash was provided from/(applied to):
Net proceeds from finance leases
2 2 5
Crown funding (including CFH securities) 20 59 179
Proceeds from debt 780 67 585
Repayment of debt (665) (52) (593)
Dividends paid (25) - (15)
Net cash flows from financing activities
112 76 161
Net cash flow
53 (2) 22
Cash at the beginning of the period 102 80 80
Cash at the end of the period
155 78 102

P. 19
Half Year Report
Notes to the financial statements
Reporting entity and statutory base
Chorus includes Chorus Limited together with its subsidiaries as at and for the six months ended
31 December 2016.
Chorus is New Zealand’s largest fixed line communications infrastructure service provider.
It maintains and builds a network predominantly made up of local telephone exchanges, cabinets,
copper and fibre cables.
Chorus Limited is a profit-oriented company registered in New Zealand under the Companies
Act 1993 and a FMC Reporting Entity for the purposes of the Financial Markets Conduct Act 2013.
The condensed consolidated interim financial statements have been prepared in accordance with
the New Zealand equivalent to International Accounting Standard No. 34: “Interim Financial
Reporting” and Generally Accepted Accounting Practice in New Zealand (NZ GAAP). These financial
statements are prepared in New Zealand dollars. These condensed interim financial statements do not
include all of the information required for the full annual financial statements and should be read in
conjunction with the consolidated financial statements of Chorus as at and for the year ended
30 June 2016.
The measurement basis adopted in the preparation of these financial statements is historical cost,
modified by the revaluation of financial instruments as identified in the specific accounting policies
disclosed in the notes to the consolidated financial statements for the year ended 30 June 2016 and
described in note 8 to these condensed consolidated interim financial statements.
Accounting policies and standards
The condensed consolidated interim financial statements have been prepared using the same
accounting policies and methods of computation as the financial statements for the year ended
30 June 2016.
The condensed consolidated interim financial statements for the six months ended
31 December 2016, and comparative information for six months ended 31 December 2015 are
unaudited. The comparative information for the year ended 30 June 2016 is audited. No comparative
balances have been reclassified from the prior period’s presentation.
Accounting estimates and judgements
In preparing the condensed consolidated interim financial statements management has made estimates
and assumptions about the future that affect the reported amounts of assets and liabilities at the date of
the financial statements and the reported amounts of revenue and expenses during the period. Actual
results could differ from those estimates.
In preparing the condensed consolidated interim financial statements, the significant judgements made
by management in applying Chorus’ accounting policies and the key source of uncertainty were the
same as those that applied to the consolidated financial statements as at and for the year ended
30
 June 2016.

P. 20
Half Year Report
Note 1 – Network assets
(DOLLARS IN MILLIONS)
31 DEC 2016
UNAUDITED
$M
31 DEC 2015
UNAUDITED
$M
30 JUNE 2016
AUDITED
$M
Cost
Opening balance 8,342 7, 81 5 7, 81 5
Additions 287 232 528
Other 10 (2) -
Disposals (1) (1) (1)
Closing balance 8,638 8,044 8,342
Accumulated depreciation
Opening balance (4,686) (4,409) (4,409)
Depreciation (143) (136) (278)
Other 2 - -
Disposals - 1 1
Closing balance (4,827) (4,544) (4,686)
Net carrying amount
3,811 3,500 3,656
Other – Property exchanges
Chorus has leased exchange space and commercial co-location space owned by Spark which is subject
to finance lease arrangements. Chorus in turn leases exchange space and commercial co-location space
owned by Chorus to Spark under a finance lease arrangement
.
For sites that it does not own, Chorus recognises its share of the assets based on occupancy
percentage, as well as a liability for the future payments due. For sites that it does own, Chorus
derecognises the share of the asset used by Spark, as well as recognising a receivable for the future
receipts due.
The Other cost and accumulated depreciation movement in half year 2017 of $12 million (30 June
2016: nil; 31 December 2015: nil) relates to a reassessment of the extent of Spark’s use of Chorus
owned sites and Chorus’s use of Spark’s sites. It also represents the estimated impact over the lease
term for a contractual price increase in relation to these sites.
Capital commitments
There are no restrictions on Chorus network assets or any network assets pledged as security for liabilities.
At 31 December 2016 the contractual commitment for acquisition of network assets was $321 million
(30 June 2016: $341 million; 31 December 2015: $428 million).
Depreciation
The Crown funding released against depreciation for the six months ended 31 December 2016 was
$11 million (30 June 2016: $15 million; 31 December 2015: $7 million).

P. 21
Half Year Report
Note 2 – Software and other intangibles
(DOLLARS IN MILLIONS)
31 DEC 2016
UNAUDITED
$M
31 DEC 2015
UNAUDITED
$M
30 JUNE 2016
AUDITED
$M
Cost
Opening balance 634 569 569
Additions 15 22 65
Closing balance 649 591 634
Accumulated amortisation
Opening balance (474) (410) (410)
Amortisation (32) (32) (64)
Closing balance (506) (442) (474)
Net carrying amount
143 149 160
Capital commitments
There are no restrictions on Chorus software and other intangible assets or any software and other
intangible assets pledged as security for liabilities.
At 31 December 2016 the contractual commitment for acquisition of software and other intangible
assets was $29 million (30 June 2016: $6 million; 31 December 2015: $8 million).

P. 22
Half Year Report
Note 3 – Debt
(DOLLARS IN MILLIONS)
31 DEC 2016
UNAUDITED
$M
31 DEC 2015
UNAUDITED
$M
30 JUNE 2016
AUDITED
$M
Euro medium term notes GBP – Apr 2020 461 561 485
Euro medium term notes EUR – Oct 2023 751 - -
Fixed rate NZD Bonds – May 2021 400 - 400
Syndicated bank facility A - 450 -
Syndicated bank facility B - 365 415
Syndicated bank facility C – May 2019 - 250 250
Short term debt facility - 15 -
Less: facility fees (15) (4) (10)
1,597 1,637 1,540
Current
- 465 -
Non-current
1,597 1,172 1,540
On 18 October 2016 Chorus issued EUR 500 million of Euro Medium Term Notes at a fixed rate of
1.125%. They will mature in October 2023 and have been swapped back to $785 million using cross
currency interest rate swaps (see note 8).
In November 2016 syndicated facility B was repaid and cancelled. Facility C was repaid and remains
available for future operating activities until May 2019. As at 31 December 2016 Chorus had $250 million
committed syndicated bank facilities on market standard terms and conditions (30 June 2016:

$925 million; 31 December 2015: $1,500 million). The amount of undrawn syndicated bank facility
that is available for future operating activities at 31 December 2016 is $250 million (30 June 2016:
$260 million; 31 December 2015: $435 million).
The Euro Medium Term Note debt of GBP 260 million as at 31 December 2016 has been swapped back
to $677 million (30 June 2016: $677 million; 31 December 2015: $677 million), using cross currency
interest rate swaps (see note 8).

P. 23
Half Year Report
Note 4 – CFH securities
(DOLLARS IN MILLIONS)
31 DEC 2016
UNAUDITED
$M
31 DEC 2015
UNAUDITED
$M
30 JUNE 2016
AUDITED
$M
Fair value on initial recognition
Opening balance 132 97 97
Additional securities recognised at fair value 7 6 35
Closing balance 139 103 132
Accumulated notional interest
Opening balance 20 10 10
Notional interest 6 5 10
Closing balance 26 15 20
Total CFH securities
165 118 152
Note 5 – Crown funding
(DOLLARS IN MILLIONS)
31 DEC 2016
UNAUDITED
$M
31 DEC 2015
UNAUDITED
$M
30 JUNE 2016
AUDITED
$M
Fair value on initial recognition
Opening balance 679 548 548
Additional funding recognised at fair value 19 40 131
Closing balance 698 588 679
Accumulated amortisation of funding
Opening balance(40) (25) (25)
Amortisation (11) (7) (15)
Closing balance (51)(32)(40)
Total Crown funding
647 556 639
Current
18 14 17
Non-current
629 542 622
Ultra-Fast Broadband
Chorus receives funding from the Crown to finance construction costs associated with the
development of the UFB network. During the period Chorus has recognised funding for 19,784
premises passed (30 June 2016: 121,253; 31 December 2015: 16,124) where user acceptance testing
was complete at 31 December 2016. This brings the total number of fully completed and paid
for premises passed at 31 December 2016 to approximately 494,000 (30 June 2016: 474,000;
31 December 2015: 378,000).

P. 2 4
Half Year Report
Continued recognition of the full amount of the Crown funding is contingent on certain material
performance targets being met by Chorus. The most significant of these material performance targets
relate to the number of premises passed by fibre optic cables by key dates and compliance with
certain specifications under user acceptance testing by Crown Fibre Holdings. Performance targets to
date have been met.
Note 6 – Segmental reporting
Chorus has determined that it operates in one segment providing nationwide fixed line access
network infrastructure. The determination is based on the reports reviewed by the Chief Executive
Officer in assessing performance, allocating resources and making strategic decisions.
Note 7 – Equity
Dividends
On 7 October 2016 a fully imputed final dividend of 12 cents per share, $48 million, was paid to
shareholders (30 June 2016: 8 cents per share, $32 million; 31 December 2015: no dividends were paid).
Net tangible assets per security
Net tangible assets per security for the period 31 December 2016 was $1.91 (30 June 2016: $1.77;
31 December 2015: $1.73).
L
ong-term performance share scheme
Chorus operates a long-term performance share scheme for selected key management personnel.
The August 2015 issue featured two grants. The shares relating to the first grant have a vesting date
of two years from 30 June 2015 (2 year grant), and the shares relating to the second grant have a
vesting date of three years from 30 June 2015 (3 year grant). Each grant is made up of two tranches,
the first with a relative performance hurdle (Chorus’ actual Total Shareholder Return (TSR) compared
to other members of the NZX50) and the second with an absolute performance hurdle (Chorus’
actual TSR being greater than 10.8% per annum compounding).
The August 2016 issue consisted of one three year grant. The shares have a vesting date of
22 September 2019 and an expiry date of 22 September 2020. The grant has an absolute
performance hurdle (Chorus’ actual Total Shareholder Return (TSR) equalling or being greater
than 9.8% per annum compounding) ending on the vesting date, with provision for monthly retesting
in the following twelve month period (noting that the TSR continues to increase through this period).
The combined option cost for the period ended 31 December 2016 of $131,000 has been recognised
in the income statement (30 June 2016: $218,000; 31 December 2015: nil).

P. 25
Half Year Report
Note 8 – Derivative financial instruments
Finance expense includes any non-cash ineffectiveness arising from the Euro Medium Term Notes
(EMTN) hedge relationship. Following the close out of the interest rate swaps relating to the EMTN
(GBP) the hedge relationship was reset in December 2013 with a fair value of $49 million. The balance
at 31 December 2016 is $22 million (30 June 2016: $21 million; 31 December 2015: $28 million).
As long as the hedge remains effective any future gains or losses will be processed through the hedge
reserve, however the ineffectiveness will flow to interest expense in the income statement at some
time over the life of the derivatives. It will be a non-cash charge. Neither the direction, nor the rate
of the impact on the income statement can be predicted. For the six months to 31 December 2016
a credit of $1 million ineffectiveness was recognised within finance expense in the income statement
(30 June 2016: $9 million; 31 December 2015: $2 million).
In November 2016, Chorus repaid the Syndicated Bank Facility and the associated Interest Rate
Swaps expired. One Interest Rate Swap (IRS) has been maintained and is not in a designated hedging
relationship. The fair value remeasurement non-cash gains or losses on this IRS are recognised
immediately in finance expense in the income statement. For the period to 31 December 2016
$6 million was recognised in finance expense (30 June 2016: nil; 31 December 2015: nil).
In conjunction with the EMTN (EUR) 500 million issued on 18 October 2016, Chorus entered into Cross
Currency Interest Rate Swaps to hedge the foreign currency and foreign interest rate risks on the EMTN
(EUR). These swaps have an aggregate principal of EUR 500 million and NZD 785 million. Chorus will
pay New Zealand Dollar floating interest rates and receive EUR denominated fixed interest which
match the underlying notes. For the period to 31 December 2016, $6 million of non-cash charges
relating to the change in fair value of this hedge relationship was recognised in finance expense.
Note 9 – Related party transactions
The gross remuneration of directors and key management personnel during the period was
$4.5 million (30 June 2016: $8.3 million; 31 December 2015: $4.1 million).
The Company has loans to employees and nominees (Chorus LTI Trustee Limited) receivable at
31 December 2016 of $1.6 million (30 June 2016: $1.2 million; 31 December 2015: $1.2 million)
as outlined in the long-term performance share scheme section of note 7. All loans outstanding
are interest-free limited recourse loans.

P. 26
Half Year Report
Note 10 – Post balance date events
Dividends
On 20 February 2017 Chorus declared an interim dividend in respect of the six month period ending
31 December 2016. The total amount of the dividend is $38.2 million, which represents a fully
imputed dividend of 8.5 cents per ordinary share.
CFH Securities and Crown funding
Chorus issued a call notice on 27 January 2017 to CFH with an aggregate issue price of $7.9 million
and 245,242 warrants. Part of this funding ($5.0 million, 4,434 premises) has been accrued in the
financial statements at 31 December 2016 representing the portion of the call notice where user
acceptance testing was complete.
Ultra-Fast Broadband extension (UFB2)
On 26 January 2017 Chorus announced that the UFB rollout would be extended to a further 169 areas,
making fibre available to approximately 200,000 more homes and businesses. The second phase of
the UFB rollout is expected to commence in July 2017 and finish by December 2024.

P. 27
Auditors’ review report
To the shareholders of Chorus Limited
We have completed a review of the condensed
consolidated financial statements of Chorus Limited
and its subsidiaries (“the Group”) on pages 13 to 26
which comprise the statement of financial position
as at 31 December 2016, the income statement and
the statement of comprehensive income, statement
of changes in equity and statement of cash flows

for the six month period ended on that date,
and a summary of significant accounting policies
and other explanatory information.
This report is made solely to the shareholders

of Chorus Limited as a body. Our review work has
been undertaken so that we might state to the
Group’s shareholders those matters we are required
to state to them in the independent review report
and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume
responsibility to anyone other than the Group’s
shareholders as a body, for our review work, this
report or any of the opinions we have formed.
Directors’ responsibilities
The directors of Chorus Limited are responsible for
the preparation of condensed consolidated financial
statements in accordance with NZ IAS 34 Interim
Financial Reporting and for such internal control as
the directors determine is necessary to enable the
preparation of the condensed consolidated financial
statements that are free from material misstatement,
whether due to fraud or error.
Our responsibilities
Our responsibility is to express a conclusion on the
condensed consolidated financial statements based
on our review. We conducted our review in
accordance with NZ SRE 2410 Review of Financial
Statements Performed by the Independent Auditor
of the Entity. NZ SRE 2410 requires us to conclude
whether anything has come to our attention that
causes us to believe that the financial statements are
not prepared, in all material respects, in accordance
with NZ IAS 34 Interim Financial Reporting. As the
auditor of the Group, NZ SRE 2410 requires that we
comply with the ethical requirements relevant to the
audit of the annual financial statements.
A review of condensed consolidated financial
statements in accordance with NZ SRE 2410 is

a limited assurance engagement. The auditor
performs procedures, primarily consisting of making
enquiries, primarily of persons responsible for
financial and accounting matters, and applying
analytical and other review procedures.
The procedures performed in a review are
substantially less than those performed in an audit
conducted in accordance with International
Standards on Auditing (New Zealand). Accordingly
we do not express an audit opinion on those
financial statements.
Our firm has also provided regulatory audit services
and sponsorship services to the Group. These
matters have not impaired our independence as
auditors of the Group. The firm has no other
relationship with, or interest in, the Group.
Conclusion
Based on our review, nothing has come to our
attention that causes us to believe that these
condensed consolidated financial statements of

the Group do not present fairly, in all material
respects, the financial position of the Group as at

31 December 2016, and of its financial performance
and its cash flows for the six month period ended

on that date, in accordance with NZ IAS 34 Interim
Financial Reporting.
Wellington, 20 February 2017

P. 28
Glossary
BackhaulIs the portion of the network that links local exchanges to other exchanges
or retail service provider networks.
Bandwidth fibreA fibre service that provides dedicated bandwidth (up to 10Gbps download
speed) between customers and their retail service provider’s equipment in
the local exchange.
Baseband IPUsed by retail service providers to provide a copper voice service from their
exchange equipment via Chorus equipment in cabinets or exchanges.
Building block modelRefers to a methodology used for regulating monopoly utilities. Under BBM
a regulated supplier’s allowed revenue is equal to the sum of the underlying
components or ‘building blocks’, consisting of the return on capital,
depreciation, operating expenditure and various other components
such as tax.
CFHCrown Fibre Holdings Limited, the Government organisation that manages
New Zealand’s rollout of Ultra-Fast Broadband infrastructure.
ChorusChorus Limited and subsidiaries.
CommissionCommerce Commission – the independent Crown Entity whose responsibilities
include overseeing the regulation of the telecommunications sector.
Direct fibreAlso known as ‘dark’ fibre, a fibre service that provides a point to point fibre
connection and can be used to deliver backhaul connections to mobile sites.
EBITDAEarnings before interest, income tax, depreciation and amortisation.
EMTNEuropean Medium Term Note.
FYFinancial year – twelve months ended 30 June. e.g. FY16 is from 1 July 2015
to 30 June 2016.
GigabitThe equivalent of 1 billion bits. Gigabit Ethernet provides data transfer rates
of about 1 gigabit per second.
GbpsGigabits per second. A measure of the average rate of data transfer.
HSNSHigh Speed Network Service – a high speed Layer 2 service with dedicated
bandwidth on either copper or fibre.

P. 29
IFRSInternational Financial Reporting Standards – the rules that the financial
statements have to be prepared by.
MbpsMegabits per second – a measure of the average rate of data transfer.
Naked copperBroadband only connections, where the customer does not also take
an analogue voice service.
RBIRural Broadband Initiative – refers to the Government programme to
improve and enhance broadband coverage in rural areas between 2011
and 2016.
ShareMeans an ordinary share in Chorus.
SLESSub Loop Extension Service – enables retail service providers to connect
a sub loop UCLL line from a cabinet to the exchange.
SLUSub Loop Unbundling – where retail service providers use the regulated
copper line service available between the premises and cabinet.
TSOTelecommunications Services Obligation – a universal service obligation
under which Chorus must maintain certain coverage and service on the
copper network.
UBAUnbundled Bitstream Access – regulated service that enables retail service
providers to use Chorus equipment to deliver broadband to customers.
UCLLUnbundled Copper Local Loop – a regulated service enabling retail service
providers to offer voice and broadband services on copper lines using their
own electronic equipment in the exchange.
UFBUltra-Fast Broadband – refers to the Government programme to build
a fibre to the premises network to about 85% of New Zealanders by the
end of 2024.
VDSLVery High Speed Digital Subscriber Line – a copper-based technology
that provides data transmission up to about 100Mbps downstream and
50Mbps upstream.

ARBN 152 485 848

---

Chorus Limited
Results for announcement to the market

Reporting Period Six months ended 31 December 2016
Previous Reporting Period Six months ended 31 December 2015

Amount (000s) Percentage change
Revenue from ordinary activities $529,000 Up 10.4%
Profit (loss) from ordinary activities
after tax attributable to security
holders.
$66,000 Up 100%
Net profit (loss) attributable to
security holders.
$66,000 Up 100%

Interim/Final Dividend Amount per security Imputed amount per
security
Interim dividend 8.5 cps 3.3 cps

Record Date 21 March 2017
Dividend Payment Date 4 April 2017

Comments: This announcement should be read in
conjunction with the attached half year
report, financial statements for the six
months ended 31 December 2016 contained
in that report, media release and investor
presentation.

Dividends

A fully imputed interim dividend for the 2017 financial year of 8.5 cents per ordinary
share will be paid on 4 April 2017. The total interim dividend will be $38.2 million.

Dividend Reinvestment Plan

Chorus’ dividend reinvestment plan will operate for the interim dividend.

Under the Plan eligible shareholders can choose to reinvest all or part of their
dividend entitlements in additional Chorus shares (rather than receiving cash
payments). There are no charges for participation in the Plan.

The price of the shares to be issued under the Plan will be the volume weighted
average sale price of Chorus shares calculated on all price setting trades taking
place through the NZX over a period of five trading days commencing on the ex-
dividend date less a 3% discount.

Shares issued under the Plan will rank equally with Chorus’ existing ordinary
shares.

Election notices to participate in the Plan must be received by 5pm (NZ time) 22
March 2017.

Net tangible assets per security

There are $1.91 net tangible assets per security (31 December 2015: $1.73).

Audit

This report is based on financial statements which have been reviewed. Chorus’
auditors have issued a clear review report. A copy of the review report is included
in the attached half year report.

Accounting policies

There have been no changes in accounting policies. All policies have been
consistently applied throughout the period.

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APPENDIX 7 – NZSX Listing Rules
Number of pages including this one
(Please provide any other relevant
NZSX Listing Rule 7.12.2. For rights, NZSX Listing Rules 7.10.9 and 7.10.10. details on additional pages)
For change to allotment, NZSX Listing Rule 7.12.1, a separate advice is required.
Full name
of Issuer
Name of officer authorised to
Authority for event,
make this notice
e.g. Directors' resolution
Contact phone
Contact fax
numbernumber
Date
Nature of event
BonusIf ticked,
Rights Issue
Tick as appropriate
Issue
state whether:Taxable
/ Non TaxableConversionInterestRenouncable
Rights IssueCapitalCallDividend
If ticked, stateFull
non-renouncable
change
√
whether:
Interim
√
YearSpecialDRP Applies
√
EXISTING securities affected by this
If more than one security is affected by the event, use a separate form.
Description of theISIN
class of securities
If unknown, contact NZX
Details of securities issued pursuant to this eventIf more than one class of security is to be issued, use a separate form for each class.
Description of theISIN
class of securities
If unknown, contact NZX
Number of Securities toMinimum
Ratio, e.g
be issued following eventEntitlement
1 for 2 for
Conversion, Maturity, Call
Treatment of Fractions
Payable or Exercise Date
Tick if
provide an
pari passu
ORexplanation
Strike price per security for any issue in lieu or date
of the
Strike Price available.
ranking
Monies Associated with Event
Dividend payable, Call payable, Exercise price, Conversion price, Redemption price, Application money.
Source of
Amount per securityPayment
(does not include any excluded income)
Excluded income per security
(only applicable to listed PIEs)
SupplementaryAmount per security
Currencydividendin dollars and cents
details -
NZSX Listing Rule 7.12.7
Total monies
TaxationAmount per Security in Dollars and cents to six decimal places
In the case of a taxable bonusResident
Imputation Credits
issue state strike priceWithholding Tax(Give details)
Foreign
FWP Credits
Withholding Tax(Give details)
Timing
(Refer Appendix 8 in the NZSX Listing Rules)
Record Date 5pmApplication Date
For calculation of entitlements -Also, Call Payable, Dividend /
Interest Payable, Exercise Date,
Conversion Date. In the case
of applications this must be the
last business day of the week.
Notice DateAllotment Date
Entitlement letters, call notices,For the issue of new securities.
conversion notices mailedMust be within 5 business days
of application closing date.
OFFICE USE ONLY
Ex Date:
Commence Quoting Rights:Security Code:
Cease Quoting Rights 5pm:
Commence Quoting New Securities:Security Code:
Cease Quoting Old Security 5pm:
$
21 March, 20174 April, 2017
$34,594,132
Date Payable
4 April, 2017
$$0.005900$0.033100
In dollars and cents
RETAINED EARNINGS
$0.085
NZD$0.015000
Enter N/A if not
applicable
(04) 896 4003(04) 471 00132022017
ORDINARY SHARENZCNUE0001S2
EMAIL: announce@nzx.com
Notice of event affecting securities
1
CHORUS LIMITED
ANDREW CARROLLDIRECTORS' RESOLUTION

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1. Earnings before interest, income tax, depreciation and amortisation (EBITDA) is a non-GAAP profit measure. We monitor this as a key
performance indicator and we believe it assists investors in assessing the performance of the core operations of the business.
2. Adjusted to reflect the change in regulated copper pricing from 16 December 2015 and the effect of capitalisation of certain labour and IT costs
previously expensed. Refer to Appendix A of the H1 FY17 investor presentation for the detailed calculation.

Chorus Limited
Level 10, 1 Willis Street
P O Box 632
Wellington 6140
New Zealand
Email: company.secretary@chorus.co.nz





20 February 2017



Dear investor

We've recently announced our financial results for the six months to 31 December 2016. Our half
year report and a recorded webcast of our results briefing are available on our website at
www.chorus.co.nz/financial-results.

Dividend details
We announced net profit after tax of $66 million and will pay an interim dividend of 8.5 cents per
share on 4 April 2017 to all holders registered at 5:00pm 21 March 2017. A final dividend of 12.5
cents per share will be declared in August 2017, subject to no material adverse changes in
circumstances or outlook.

Dividend reinvestment plan for shareholders
A dividend reinvestment plan is available to our Australian and New Zealand resident shareholders
with a discount rate of 3% for the 4 April 2017 interim dividend payment. If you haven’t previously
registered to participate and wish to do so, you'll need to have registered your participation by
5:00pm (NZ time) on 22 March 2017. You can register by logging into your Computershare
profile at www.investorcentre.com/nz or downloading the Participation Notice at
www.chorus.co.nz/dividends and returning it to Computershare.

The full terms of the reinvestment plan can be read in our Offer Document dated February 2016 at
www.chorus.co.nz/dividends, or you can request a copy free of charge. Our audited financial
statements, and auditor’s report, are included in our annual report also available on our website at
www.chorus.co.nz/financial-results.

Customer focus continues
The six month period to 31 December 2016 was a particularly busy time for the company, with our
ongoing focus on delivering better outcomes for customers highlighted by:
 fibre connection times improving significantly from an average lead time of 17 days to 10
days
 reaching an agreement with Crown Fibre Holdings to continue to provide free non-standard
residential connections for the rest of the Ultra-Fast Broadband (UFB) rollout
 extending the availability of 1 gigabit (1,000 Megabits per second) fibre services across our
UFB footprint
 completing an investment programme to upgrade nearly 100 rural broadband cabinets
 increasing our efforts to help retailers transition more copper broadband customers to the
faster VDSL speeds already available to many at no additional wholesale cost
 announcing that the entry level 30Mbps fibre service for new and existing customers would
be upgraded to 50Mbps to mark our fifth birthday
 concluding our agreement with the Government, as announced in January 2017, to extend
the rollout of UFB to approximately 200,000 more customers by the end of 2024
We believe it is in the long term interests of shareholders to take fibre further because fibre has
clearly become the preferred broadband product of choice for customers. Uptake in the areas we
completed in the first year of the UFB rollout has surpassed 40% and orders received in our FY16
build areas have already reached 35% of possible demand within 18 months. Crown Fibre Holdings
is providing up to $291.3 million in additional funding to help make the business case for us to
extend fibre to these new areas sooner than would have otherwise occurred and on terms similar to
the existing UFB rollout.

The number of fixed line connections across our network declined 3% during the six month period,
largely reflecting local fibre companies continuing to gain more market share in their UFB network
areas. Line loss during the period was also influenced by a marketing push by vertically integrated
retailers seeking to convert their customer base to their own wireless broadband networks and the
usual seasonal effect of summer holidays as tertiary students, for example, disconnect broadband
services.

While wireless broadband may be a viable option for some low data users in poor broadband
coverage zones, we’re confident that our fixed line network offers solid reliability and consistent
performance both for voice and broadband. The latter is particularly apparent during peak
broadband usage hours and we note that a wireless broadband retailer has recently branched out
from its core mobile offering to promote an unlimited data service on the fixed line network. On
average, a customer with a copper broadband connection is likely to experience a fault roughly once
every five years, with downtime typically being less than a day.

Change in leadership
Having skilfully navigated through the establishment of Chorus and some tumultuous years, chief
executive Mark Ratcliffe steps down knowing the fibre rollout is going well, the company is in a
strong position and it has been recognised as one of the best employers in Australasia for five
consecutive years. The Board offers him their best wishes and thanks for a job well done. We’re
very pleased that Kate McKenzie has agreed to now lead Chorus. She is one of the most highly

rated telecommunications executives in the region and was most recently Telstra’s Chief Operations
Officer, responsible for Telstra’s field services, IT and network architecture and operations.

Managing your Chorus shareholding information online
Did you know that you can log in to www.investorcentre.com/nz to update your postal or email
address and dividend payment details whenever you want? More information on how to get started
is available here: https://www.chorus.co.nz/shareholder-information

As noted above, our half year report has been published on our website. If you’d prefer to receive a
printed copy (free of charge) please contact Computershare. If you’ve requested a printed copy in
previous years you don’t need to send another request. Alternatively, if you no longer wish to
receive printed copies, please let Computershare know or update your investor profile details
online.

Thank you for your support of Chorus.

Kind regards


Patrick Strange
Chairman