TrustPower Limited Third Quarter Result

Media Statement January 25, 2007

TrustPower Limited Third Quarter Result

Nine Months Ended 31 December 2006

TrustPower's unaudited after tax surplus for the nine months ended 31 December 2006 was $82.4 million, compared with $68.7 million for the same period last year. Earnings before Interest, Tax, Deprecation and Amortisation ("EBITDA") were $161.0 million versus $149.5 million for the prior period.

The third quarter's trading environment saw a significant change of conditions from that experienced in the first half of FY 2007. Lake storage levels and inflows have moved from well below average to above average leading to significantly lower spot electricity prices.

TrustPower's own generation assets produced 1,570 GWh during the nine month period versus 1,403 GWh in the prior period (an increase of 11.9 per cent). By the end of December 2006, most of TrustPower's hydro generation storage catchments had received good inflows and were above average levels for this time of year.

Customer numbers have fallen slightly to be around 219,000 at the end of December 2006. Total electricity sold to customers in the first nine months was 3,508 GWh compared with 3,614 GWh sold in the prior period.

The Company's balance sheet remains strong. Debt to debt plus equity was 28.4 per cent as at 31 December 2006 down from 31 per cent at the same time the previous year.

The 93MW expansion of the Tararua Wind Farm is progressing to plan. Civil work has been completed and the first of the 31 3MW Vestas wind turbines has been erected. Tararua Stage III is expected to produce 350 GWh per annum. Final completion is scheduled for July 2007.

The resource consent hearing for the proposed 72 MW Wairau hydro generation scheme in Marlborough has been completed and a decision on the consent application is expected to be received within the next four to six weeks.

Submissions in relation to the resource consent application for the up to 46MW hydro generation scheme at Arnold, on the West Coast, close shortly and a resource consent hearing is expected to be scheduled for mid 2007.

A revised resource consent application for a 200MW wind farm near Lake Mahinerangi in Otago has been lodged with the Clutha District and Otago Regional councils. The application has recently been notified and submissions are scheduled to close before the end of March 2007.

The Company continues to examine other potential wind farm opportunities.

Earlier in the month TrustPower announced the construction of an 88MW wind farm at Snowtown, South Australia. Under an Engineer Procure Construct turnkey (EPC) agreement with Suzlon Energy Australia Pty Limited, 42 Suzlon 2.1MW wind turbines will be located on the site.

Construction is expected to start in April this year with wind turbines being progressively commissioned between April and November 2008. The output of the wind farm is expected to be 350 GWh per annum and this output has been contracted for 10 years from commissioning via an energy and renewable credit sales agreement which will provide a high level of earnings certainty for the project during the term of the agreement.

The project is expected to cost around AUD 200 million. Foreign exchange exposure relating to the EPC contract has been fully hedged.

The result for the nine months to 31 December 2006 is pleasing and reflects TrustPower's ability to manage wholesale market risks in both high and low price periods. At this stage the Directors are confident that another good financial outcome for the full year is achievable.

ENDS

© Scoop Media