Vector Network News

MEDIA RELEASE

27 August 2012

Vector Network News

Vector 2012 earnings robust: sustained by smart growth initiatives

Highlights

· Underlying net profit after tax rose 16.1 percent to $198.8 million from $171.3 million after adjusting for the 2011 sale to Transpower of rights to use Vector’s Penrose to Hobson Street tunnel. Achieved robust earnings growth across our portfolio of businesses despite muted economic conditions and rising regulatory costs.

· Technology and gas wholesale segments growing strongly, underscoring success of
growth initiatives.

· Capital investment of $261.8 million provides for continued growth and maintenance of safe, secure and efficient energy networks to Auckland and the broader economy;

· Balance sheet remains strong; gearing[1] stands at 52.5 percent. Standard & Poor’s BBB+/stable investment-grade credit rating reaffirmed.

· A final dividend of 7.50 cents per share taking 2012 total dividends to 14.50 cents per share, extending Vector’s strong record of delivering returns to shareholders and putting more than $100 million into the pockets of Auckland Energy Consumer Trust (AECT) beneficiaries.

NETWORKS SUMMARY for week ending 26 August 2012

ELECTRICITY

With the mild weather there has been an early taste of spring. Car v pole incidents were kept to a minimum during the week, but unfortunately the weekend saw seven car v poles/assets taking place, mostly Saturday night through to Sunday morning.

These took place in Epsom, Papatoetoe, Onehunga, Manly, Avondale, Mangere and St Johns.

There was also a damaged power box near McDonalds in Mangere. Faults crews repaired a damaged streetlight conductor in Manurewa and attended a fire in Te Papapa.

GAS TRANSMISSION AND DISTRIBUTION

We had one third party strike on our gas distribution network this week when a gas pipe on Greenhithe road was struck. Fault crews also attended a damaged meter in Wellington, repaired a regulator in Orakei and attended a building fire in Taupo. Faults crews made all sites safe and repaired the equipment. Please take care around our gas network and call 0508 B4 U WORK (248 967) or 0800 B4 U DIG if outside Auckland.

METERING

Nationwide meter deployment continues for both Genesis and Contact with the total number of advanced meters deployed by AMS rapidly approaching the 400,000 mark.

OnGas

Vector’s OnGas Bottle Swap program is going from strength to strength, reporting continued good sales across all sites for the winter period.

Our featured site this week is J Young Motors Ltd (Mobil Bayview), at Bayview, Napier. Beginning operations in 1957, J Young Motors has firmly cemented itself into the local business and consumer scene. Dave Schofield, a partner within the business for the past 22 years, rejoined J Young Motors after serving his apprenticeship, before heading to Auckland for 12 years. Dave said the business’s mantra is to offer excellent customer service; with an emphasis on full forecourt service to attract more customers to their workshops and their chainsaw/lawnmower service and sales division. Specific to OnGas Bottle Swap, Dave adds their customers love it. Quick, convenient and acceptance of expired LPG bottles. He said this locks them in to continue swapping and is a huge selling point.

A member of the Red Circle buying group, Dave leads the charge for sales across this group during July; something Dave is extremely happy with. It goes to show that good old fashioned customer service and great products remain a winning formula. If you are local; or just passing through; stop in. We’d be happy to see you.

Vector’s 9kg Bottle Swap is available at hundreds of Outlets nationwide. When you need LPG for the BBQ or heater, try swapping. It’s quick, simple and convenient. With no joining fee; you will receive a good quality, safety inspected, leak tested cylinder every time. Why spend time filling when you can “Drive in and Swap out”.

PROJECT UPDATE

Vector works with Auckland Council contracted organisations whose focus is to remove graffiti in local areas. Currently, Vector is working with the Manukau Beautification Trust and Safer Papakura in the South Auckland region.

Between 1 April 2012 and 30 June 2012, Manukau Beautification removed or painted over 2,553 tags that appeared on Vector assets in the old Manukau City Council area, while the Safer Papakura Trust eliminated 390 tags between 1 May 2012 and 31 July 2012 in the Papakura area.

These two organisations are part of the new wider Auckland Council graffiti vandalism prevention plan launched last month by Mayor Len Brown. This plan is designed to not only remove tagging quickly once it has happened, but also has a focus on community education and law enforcement of offenders.

Phase two of the plan will see the consolidation of the Council areas for graffiti management into four regional areas and Vector is looking at the possibility of extending its current contracts into other areas of Auckland in line with this Council initiative.

SHORTS

• Vector owns over 17,737 kilometres of overhead and underground lines in the greater Auckland area, and 12,572 kilometres of gas pipe lines, with almost half supplying gas to Auckland.

• The Wiggles are coming to Auckland on Saturday 15 September and Sunday 16 September. Vector, proud sponsor of the Arena

The company owns and manages a unique portfolio which consists of electricity distribution, gas transmission and distribution, electricity and gas metering installations and data management services, natural gas and LPG and fibre optic networks.

Vector is listed on the New Zealand Stock Exchange with ticker symbol VCT. Our majority shareholder, with voting rights of 75.4%, is the Auckland Energy Consumer Trust (AECT).

ends

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