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Transpower Pays A 100% Dividend Of $111.5m

MEDIACOM-RELEASE-TRANSPOWER

TRANSPOWER PAYS A 100% DIVIDEND OF $111.5 MILLION TO THE CROWN

"Transpower made an after tax profit before revaluation of $111.5 million for the year to 30 June 1999, all of which will be paid as a dividend," Sir Colin Maiden, the Chairman of Transpower, said today.

"This is the first time the directors have approved payment of 100 per cent of the years' surplus before revaluation as dividend to the shareholder and this reflects the company's strong financial position," Sir Colin said.

The Board's policy is to pay 75% of the net surplus after tax as a dividend and to extend this when it is prudent to do so.

The June 1999 year's net surplus was achieved from a lower revenue base of $547 million compared with $557 million the previous year.

Last year, Transpower made a profit after tax and before revaluation of $69.6 million. However, a major downward revaluation of the company of $407.1 million produced a loss of $337.5 million after tax and revaluation. This year a relatively minor revaluation of $14.1 million occurred to produce a net profit after tax and revaluation of $97.4 million.

"The past year was particularly challenging because legislation brought far-reaching changes to the industry and transformed Transpower's traditional customer base." Sir Colin said.

"The results therefore are all the more pleasing because they were achieved at a time when the company had to establish a new commercial framework in light of these changes in order to secure its revenue," he said.

"Were this year's revaluation added back, all return targets would be exceeded,' he said.

Sir Colin said Transpower had also been able to pass on benefits to its customers,

"For example, average transmission prices have fallen from 1.70 cents/kWh in 1997/8 to an expected 1.45 cents/kWh for the 1999/2000 year," Sir Colin said.

"Improved asset management systems have contributed to our ability to save costs without compromising on service performance.

"Indeed, the company's high standard of operational performance continued and all operational targets were exceeded," he said.

ENDS....

MEDIA RELEASE FROM TRANSPOWER

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