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Vector Performs Despite Soft Economy

FINANCIAL RESULTS FOR THE HALF YEAR TO 31 DECEMBER 2012

Vector Performs Despite Soft Economy

HIGHLIGHTS:
- Revenue rises 5.0% to reach $669.4 million; energy demand subdued.
- Net profit rises 10.8% to $118.0 million as costs contained and growth in technology operation continues.
- EBITDA [1] rises 3.9% to $336.3 million.
- Interim dividend rises 0.25 cents to 7.25 cents per share.

New Zealand’s leading integrated energy infrastructure company, Vector Limited today announced an improved result for the six months to 31 December, despite the soft economy, as we benefited from growth across most of our businesses, continuation of legacy pricing on our Kapuni gas entitlements and a tight control on costs.

The Board has resolved to pay a fully-imputed interim dividend of 7.25 cents per share for the year, up from last year’s 7.0 cents per share interim dividend.

Vector chairman Michael Stiassny said: “Vector and New Zealand is facing a new economic norm. Economic growth is soft; our customers want to reduce the amount they spend on energy and the amount they consume. Meanwhile, the environment for value-enhancing acquisitions is challenging.

“As a provider of critical national infrastructure, Vector’s progress is tightly linked to these economic trends. Warmer weather across the Auckland region also reduced demand.

“However, this result demonstrates how we have continued to grow, in spite of the new economic environment. It also shows our success at optimising the group’s portfolio of businesses, lowering our risk profile in response to the new environment and containing costs.

“Our balance sheet remains strong with gearing as measured by net debt to net debt plus equity at 51.0%. We continue to seek regulatory certainty, a fairer regulatory regime and our gas wholesale book is well balanced.

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[1] This non-Generally Accepted Accounting Practice (GAAP) profit measure is defined and reconciled to GAAP on page 9 of this release. All references to these measures throughout this release are consistent with those definitions.

ENDS

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