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

 

Infratil first-half earnings fall 7.1%

Friday 11 November 2016 09:38 AM

Infratil first-half earnings fall 7.1% as Perth Energy unit struggles

By Paul McBeth

Nov. 11 (BusinessDesk) - Infratil reported a 7.1 percent fall in earnings as the listed infrastructure investor's Perth Energy division faced difficult retail conditions in Western Australia, and the company now sees its annual result tracking at the bottom end of its forecast.

Underlying earnings before interest, tax, depreciation, amortisation and fair value of financial instruments (ebitdaf) fell to $246 million in the six months ended Sept. 30 from $253.1 million a year earlier, the Wellington-based company said in a statement. Net profit sank 93 percent to $28.9 million, though the year-earlier period included $407.1 million of gains from the sale of Infratil's stakes in Z Energy and iSite Holdings. It raised its interim dividend to 5.75 cents per share, payable on Dec. 15 with a Nov. 28 record date, from 5.25 cents a year earlier.

Perth Energy was the biggest drag on earnings, posting an ebitdaf-loss of $9.7 million due to expensive product purchase arrangements and a lack of wholesale hedging products, which led to "poor performance in the retail business," Infratil said. The company has installed a "substantially new management team" which is expected to show an improvement in the second half of the financial year.

Infratil warned annual ebitdaf was tracking at the bottom end of the projected $485 million-to-$525 million range because of the flat performance from electricity generator and retailer Trustpower, Perth Energy's troubles, the cost of demerging Tilt Renewables from Trustpower, and the loss of NZ Bus's South Auckland contracts. Offsetting that will be growth at Wellington International Airport and contributions from newer investments King Country Energy, Canberra Data Centres, Australia National University student accommodation, and its US renewable business, Longroad.

The company has been on the hunt for new investments after selling out of Z, Lumo and iSite, and recycled some of that capital into CDC, ANU and Longroad through the six month period. It still has more than $500 million in cash and undrawn bank facilities and has said it favours renewable energy, the retirement sector, social infrastructure such as housing, telecommunications infrastructure, and waste management.

Capital expenditure was $103.5 million and Infratil spent $496.3 million in new investments in the half, up from $62.4 million a year earlier. It's projecting capital expenditure and investment of between $700 million and $750 million for the full year, up from $599.8 million in 2016.

The shares last traded at $2.945, having declined 10 percent so far this year, and Infratil said the discount to historic highs and its net asset value suggested conservative valuations of Trustpower and Wellington Airport and that CDC and ANU were held at a discount to cost. It's operating a $50 million share buyback "designed to repurchase shares at attractive returns and deliver strong accretion in the near term."

Earnings at Trustpower were largely flat at $118.7 million due to weak generation and a higher cost of acquiring customers, while Tilt Renewables earnings edged up to $66.1 million on higher Australian wind generation. Wellington airport lifted earnings 4.5 percent to $43.7 million on rising passenger numbers, and NZ Bus earnings rose 10 percent to $25 million on cheaper petrol costs and greater productivity.

The Metlifecare stake contributed $7.4 million while new investments CDC and ANU contributed $600,000 and $1.5 million respectively. RetireAustralia earnings fell 32 percent to $7.1 million on weak sales with new developments slated for the second half

(BusinessDesk)

ends

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

RNZ: Porirua Most Expensive Region To Rent, According To Trade Me

A rental website shows this town is now New Zealand's most expensive region to rent a house, ahead of Wellington and Auckland cities. More>>

ALSO:


Stats NZ: Nearly 1,000 More Big Businesses Now Than Two Decades Ago – Media Release

There are now 2,690 big businesses in New Zealand employing more than 100 staff – nearly 1,000 or 58 percent more than 20 years ago, Stats NZ said today. Over the 20 years to February 2020, the total number of enterprises in New Zealand increased ... More>>

ALSO:

RNZ: Housing Boom Could Get Worse, Economist Warns

Economists are calling on the Reserve Bank to reinstate lending restrictions, warning the housing market is spiralling out of control. More>>

ALSO:

Westpac: Sets Out Plan To Go Cheque-Free

Westpac NZ has announced details of its plan to phase out cheques, after signalling in May that it would be supporting a move to other forms of payment. Cheques will cease to be available as a means of payment after 25 June 2021. Westpac NZ General ... More>>

ALSO:

NZTA: Major New Zealand Upgrade Programme Projects Go To Tender

Two major New Zealand Upgrade Programme projects are beginning tenders for construction. The New Zealand Upgrade Programme is a $6.8 billion investment to get our cities moving, to save lives and boost productivity in growth areas. The first Auckland ... More>>

Reserve Bank: RBNZ Seeks To Preserve Benefits Of Cash

The Reserve Bank – Te Pūtea Matua is taking on a new role of steward of the cash system “to preserve the benefits of cash for all who need them”, Assistant Governor Christian Hawkesby told the Royal Numismatics Society of New Zealand annual conference ... More>>

ALSO:


CERT NZ: Malicious Computer Virus Targeting New Zealanders

CERT NZ, the government agency which supports organisations and individuals affected by cyber security incidents, says a recent surge of increasingly sophisticated malware attacks is affecting everyday New Zealanders as well as large organisations. The ... More>>

ALSO:

Economy: NZ Small Business Recovery Continues In September

Xero, the global small business platform, today released its Small Business Insights (XSBI) for September revealing an uptick in small business jobs and year-on-year revenue growth in New Zealand. Nationwide, the average number of jobs in the small ... More>>

ALSO:


Courts: Businessman Eric Watson Sentenced To A Four-Month Jail Term

New Zealand businessman Eric Watson has been sentenced to a four-month jail term in the UK for contempt of court, TVNZ reports. More>>

OECD: Area Employment Rate Falls By 4.0 Percentage Points, To 64.6% In Second Quarter Of 2020

The OECD area employment rate – the share of the working-age population with jobs – fell by 4.0 percentage points, to 64.6%, in the second quarter of 2020, its lowest level since the fourth quarter of 2010. Across the OECD area, 560 million persons ... More>>

Spark: Turns On 5G In Auckland And Offers A Glimpse Into The Future Of Smart Cities

Spark turned on 5G in downtown Auckland today and has partnered with Auckland Transport (AT) to showcase some of the latest in IoT (Internet of Things) technology and demonstrate what the future could look like for Auckland’s CBD with the power of 5G. 5G is ... More>>

Stats NZ: Monthly Migration Remains Low

Since the border closed in late-March 2020, net migration has averaged about 300 a month, Stats NZ said today. In the five months from April to August 2020, overall net migration was provisionally estimated at 1,700. This was made up of a net gain ... More>>