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

 

FIRST CUT: Mercury earnings fall less than expected

FIRST CUT: Mercury earnings fall less than expected on geothermal offset


By Paul McBeth

Aug. 20 (BusinessDesk) - Mercury NZ's annual operating earnings fell 11 percent, less than forecast, as record geothermal production helped offset a dry spell in the North Island that weighed on its hydro schemes.

Earnings before interest, tax, depreciation, amortisation and financial instruments declined to $505 million in the 12 months ended June 30 from a record $566 million a year earlier. That was better than the $495 million Mercury forecast in April. Forsyth Barr analyst Andrew Harvey-Green predicted earnings of $503.7 million as generation levels returned to normal in the second half of the year.

However, Mercury's net profit climbed to a record $357 million from $234 million a year earlier. That included a $177 million gain on the sale of its Metrix metering business. It sold the unit to IntelliHUB Group for $270 million. Revenue rose 11 percent to $2 billion.

"Making the most of the challenging hand dealt by Waikato catchment inflows and elevated spot pricing required a very strong performance from generation and wholesale markets teams in FY2019," chief executive Fraser Whineray said.

Mercury enjoyed two years of above-average inflows at its Waikato hydro catchment and generated a record 7,704 gigawatt hours in the 2018 financial year. Drier conditions in the North Island through much of the latest year saw Mercury generate 6,902 GWh, including a record 2,896 GWh from geothermal plant.

The board declared a final dividend of 9.3 cents per share, payable on Sept. 30 to shareholders on the register on Sept. 13. That takes the annual payment to 15.5 cents, compared to 15.1 cents last year.

The company forecast lower ebitdaf for the 2020 financial year of $485 million based on average generation of 6,620 GWh, although it expects to pay a bigger dividend of 15.8 cents.

The shares closed at $4.95 yesterday and have climbed 43 percent so far this year as investors flock to stocks offering reliable dividends in an environment where global interest rates remain on a downward trajectory.

(BusinessDesk)

ends

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Fuels Rushing In: Govt "Ready To Act" On Petrol Market Report

The Government will now take the Commerce Commission’s recommendations to Cabinet...
• A more transparent wholesale pricing regime • Greater contractual freedoms and fairer terms • Introducing an enforceable industry code of conduct • Improve transparency of premium grade fuel pricing... More>>

ALSO:

Reserve Bank Capital Review Decision: Increased Bank Capital Requirements

Governor Adrian Orr said the decisions to increase capital requirements are about making the banking system safer for all New Zealanders, and will ensure bank owners have a meaningful stake in their businesses. More>>

ALSO:

Aerospace: Christchurch Plan To Be NZ's Testbed

Christchurch aims to be at the centre of New Zealand’s burgeoning aerospace sector by 2025, according to the city’s aerospace strategic plan. More>>

ALSO:

EPA: Spill Sees Abatement Notice Served For Tamarind Taranaki

The notice was issued after a “sheen” on the sea surface was reported to regulators on Thursday 21 November, approximately 400 metres from the FPSO Umuroa. A survey commissioned by Tamarind has subsequently detected damage to the flowline connecting the Umuroa to the Tui 2H well. More>>

Taskforce Report: Changes Recommended For Winter Grazing

A Taskforce has made 11 recommendations to improve animal welfare in intensive winter grazing farm systems, the Minister of Agriculture Damien O’Connor confirmed today. More>>

ALSO: