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


Contact delivers solid financial performance

Contact delivers solid financial performance to support renewable generation investment


· Launched Contact26 strategy focused on leading New Zealand’s decarbonisation by connecting customers with our renewable energy development pipeline.

Development of new 152 megawatt Tauhara geothermal power station on track after $580m investment approved in February.

Completed $400m equity raise to support the Tauhara project and the significant expected medium-term growth capital investment programme.

Milestone of 50,000 broadband connections reached after rapid growth this year. Average electricity tariff to mass market electricity customers only up by 1.4% on FY20 despite sustained higher wholesale prices.

Ongoing strategic review of thermal assets, including ‘Thermal Co’ proposal to reduce New Zealand’s cost and carbon intensity of thermal generation while ensuring security of supply.

Southern Green Hydrogen project launched with Meridian Energy to assess New Zealand’s near-term hydrogen potential.

· Guided by our tikanga and pricing principles, we proactively worked with customers that were struggling to pay their bills, helping reduce both disconnections and bad debt.

· Solid financial performance, with operating earnings (EBITDAF) up 24% year-on-year to $553m and profit up by 50% to $187m.

Underpinned by strong asset availability and a disciplined approach to managing fuel in FY20 to support the market in FY21.
Final dividend of 21 cents per share will be paid on 15 September 2021, bringing the full year declared dividend to $272m.

New Zealand’s largest privately-owned energy company Contact Energy (‘Contact’) released its full year financial results for the 12 months to 30 June 2021 (‘FY21’) this morning.

Contact Chair Rob McDonald said Contact had delivered a “solid” financial result.

“Contact has performed ahead of expectations after successfully navigating the potential departure of major energy users, short-term issues around low rainfall in the hydro catchments, and ongoing challenges around reliable gas supply. FY21 has been a year in which we have continued to deliver solid returns for our shareholders and made significant moves to ensure the company is well-positioned for the future by spending $177m on capital investments.”

The results are underpinned by Contact’s “decisive” channel management, as it supported fuel-constrained competitors with its flexible portfolio of gas-fired and renewable assets.

Mr McDonald said the company had refreshed its strategy and was on a path to invest to meet the anticipated market growth for low-cost renewable generation.

“Contact is preparing for a time of significant change and is positioned for growth as we focus on leading New Zealand’s decarbonisation. It’s pleasing to see evidence of the strategy in action in significant ways too.

“This includes investigating the potential for hydrogen production in the lower South Island, the development of the world-class Tauhara geothermal power station in the central North Island, and the $400m equity raise for our capital investment programme as we look ahead to further renewable generation developments.”

He said it was pleasing to deliver investors a 35 cents per share annual dividend, down slightly from 39 cents per share in FY20. “This is in line with the dividend policy we updated in February this year where we target a pay-out ratio of between 80 per cent and 100 per cent of the average operating free cash flow of the preceding four financial years.”

© Scoop Media

Business Headlines | Sci-Tech Headlines


Serious Fraud Office: Commences Enquiries Into Allegations Of COVID-19 Wage Subsidy Fraud
The Serious Fraud Office has commenced a number of enquiries into alleged abuse of the Government’s COVID-19 Wage Subsidy. Director Julie Read said the allegations relate to multiple complex cases of potential fraud that have been referred to the agency following extensive investigations ... More>>

Environment: Preliminary Environmental Data On New Zealand’s Air Quality Released Today

The Ministry for the Environment and Stats NZ have published the Our air 2021: preliminary data release today. We are currently working to revise the Our air 2021 report to incorporate analysis of the World Health Organization (WHO) 2021 air quality guidelines that were released on 23 September 2021... More>>

Statistics: Food Prices Rise For Sixth Consecutive Month
Food prices rose 0.5 percent in September 2021 compared with August 2021, mainly influenced by higher prices for grocery food and meat, poultry, and fish, Stats NZ said today. September’s movement is the sixth consecutive monthly rise. After adjusting for seasonality, prices rose 0.9 percent... More>>

Reserve Bank: Robust Balance Sheets Yield Faster Economic Recovery

Stronger balance sheets for households, businesses, financial institutions and the government going into the pandemic contributed towards maintaining a sound financial system and yielding a faster economic recovery than following previous deep recessions... More>>

Transpower: Releases Independent Report Into Events Of August 9
Transpower’s Chief Executive Alison Andrew has today released an independent report into the grid emergency of August 9 when insufficient generation was available to meet demand, leading to some customers being disconnected... More>>

Bayleys: Latest Lockdown Adds Further Fuel To Industrial Property Market

The recent construction shutdown resulting from Auckland’s Covid 19’s lockdown restrictions has put additional pressure on an industrial property market that is already struggling to keep pace with demand... More>>