FIRST CUT: Contact Energy FY operating earnings up 12%

By Gavin Evans

Aug. 12 (BusinessDesk) - Contact Energy said full-year operating earnings from continuing operations rose 12 percent, boosted by a strong performance from the firm’s generation and wholesale business.

New Zealand's second-largest electricity and gas retailer said earnings before interest, tax, depreciation, amortisation and changes in financial instruments from continuing operations rose to $505 million in the year ended June 30, from $449 million a year earlier.

That excludes the RockGas LPG business and the Ahuroa gas storage facility, which the firm sold to First Gas in the first half for $390 million. Including those non-continuing operations, ebitdaf rose 8 percent to $518 million.

Including the gain on those sales, full-year net profit more than doubled to $345 million from $132 million. Excluding such one-time gains, underlying net profit was $176 million, up from $112 million a year earlier, the company said.

Generation earnings rose by $67 million to $464 million, boosted by higher generation prices and a 22 percent increase in hydro generation from its South Island dams, which helped offset a shortage of gas in late 2018 and earlier this year.

Earnings from the customer business fell $9 million to $67 million, reflecting competition, higher pass-through costs and slightly higher costs to serve customers. The company previously reported that energy sales to mass-market customers were down about 1.3 percent and electricity customer numbers also fell by 2,500 over the year to 410,500.

Contact will pay a 23 cent final dividend on Sept. 17 to investors registered at Aug. 29. That is up from 19 cents a year earlier, and takes the full-year payout to Contact’s 39 cents a share target. It paid out 32 cents a year earlier.

The company’s shares last traded at $8.30 and have gained about 41 percent so far this year.

(BusinessDesk)

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