Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


Transpower returns to 1H profit, earnings margin beats SCI

Transpower returns to 1H profit, earnings margin ahead of SCI annual target

By Paul McBeth

March 1 (BusinessDesk) - State-owned national electricity grid operator Transpower returned to a first-half profit after taking a smaller unrealised hit on its financial instruments than a year earlier, and its earnings margins are tracking ahead of its annual target.

The Wellington-based company made a profit of $70.7 million in the six months ended Dec. 31 from a loss of $51.5 million a year earlier, it said in a statement. Stripping out unrealised movements in its financial instruments, earnings climbed 45 percent to $111.5 million, and revenue gained 20 percent to $453.2 million.

Earnings before interest, tax, depreciation, amortisation and changes in the fair value of financial instruments climbed 45 percent to $155.3 million in the period. That margin of earnings rose 5.8 percentage points to 69.2 percent, and is tracking ahead of the 66.3 percent margin budgeted for in Transpower's latest statement of corporate intent.

"The increase was primarily due to transmission grid upgrading investment resulting in an increase in transmission revenue," the company said.

The state-owned enterprise, which isn't one slated for a selldown by the government, will pay an interim dividend of $92 million, down from $110 million a year earlier after a capital structure review. Transpower is targeting an annual return to the Crown of $229 million.

The company is facing a radical overhaul of how it can set its transmission prices, after the Electricity Authority last year outlined its new approach on how best to charge for that national grid in a bid to share out the costs of national electricity transmission at a lower overall cost than under the current regime.

Chairman Mark Verbiest said Transpower has the HVDC Pole3 upgrade and North Auckland and Northland grid upgrade due for commissioning this calendar year, having commissioned the North Island upgrade in October last year.

"These projects will result in a more reliable and resilient grid for New Zealanders," Verbiest said. "Although our programme of major capital investments is nearing completion, we will continue to implement a range of small to medium sized projects to maintain the reliability and resilience of the grid."


© Scoop Media

Business Headlines | Sci-Tech Headlines


Banks: Westpac Keeps Core Government Transactions Contract

The local arm of Westpac Banking Corp has kept its contract with the New Zealand government to provide core transactions, but will have to share peripheral services with its rivals. More>>


Science Investment Plan: Universities Welcome Statement

Universities New Zealand has welcomed the National Statement of Science Investment released by the Government today... this is a critical document as it sets out the Government’s ten-year strategic direction that will guide future investment in New Zealand’s science system. More>>


Scouring: Cavalier Merger Would Extract 'Monopoly Rents' - Godfrey Hirst

A merger of Cavalier Wool Holdings and New Zealand Wool Services International's two wool scouring operations would create a monopoly, says carpet maker Godfrey Hirst. The Commerce Commission on Friday released its second draft determination on the merger, maintaining its view that the public benefits would outweigh the loss of competition. More>>


Scoop Review Of Books: She Means Business

As Foreman says in her conclusion, this is a business book. It opens with a brief biographical section followed by a collection of interesting tips for entrepreneurs... More>>


Hourly Wage Gap Grows: Gender Pay Gap Still Fixed At Fourteen Percent

“The totally unchanged pay gap is a slap in the face for women, families and the economy,” says Coalition spokesperson, Angela McLeod. Even worse, Māori and Pacific women face an outrageous pay gap of 28% and 33% when compared with the pay packets of Pākehā men. More>>


Housing: English On Housing Affordability And The Economy

"Long lead times in the planning process tend to drive prices higher in the upswing of the housing cycle. And those lead times increase the risk that eight years later, when additional supply arrives, the demand shock that spurred the additional supply has reversed. The resulting excess supply could produce a price crash..." More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news