One Off Non-Trading Impact of Recent Tax Changes

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PO Box 6159 Level 6, 57 Courtenay Place Telephone: 04 384-9734
Wellington 6141 Wellington Email: cmc@colmotor.co.nz
NEW ZEALAND DX SP21009 Website: www.colmotor.co.nz




ONE OFF NON-TRADING IMPACT OF RECENT TAX CHANGES

Recent changes to the tax depreciation rules have removed the
ability of owners of commercial buildings (with an estimated useful life
of 50 years or more) to deduct depreciation for tax purposes. This
will affect the Company via a one off, non-cash deferred tax
adjustment of $12.7million to the Profit for the Year to 30 June 2024.

This one-off accounting adjustment does not affect the Trading Profit
after Tax, which is the base for the determination and payment of the
final dividend.

The adjustment also has no impact on current year cash flows or the
tax liability, nor on the Company’s operating activities or property
portfolio.

The impact on future years’ results will see a minor increase in the
tax liability over a period of decades.

Calculating the impact of the change to the tax depreciation rules was
dependent on finalisation of the property valuation exercise carried
out by Quotable Value New Zealand for the Company’s year end
financial reporting.



On behalf of the Board
The Colonial Motor Company Limited

A J Waugh
Chair


23 July 2024