Horizon Energy cuts guidance, Mainzeal losses still to come
Eastern Bay of Plenty electricity lines company Horizon Energy has sliced its forecast earnings by a fifth on the cost of regulation and last year's Aquaheat acquisition, and signalled there may be more to come after its exposure to the collapse of Mainzeal Property and Construction.
The Whakatane-based company expects to post net profit of $3.4 million in the year ending March 31, down from a previous forecast of $4.3 million, Horizon says in a statement.
That is down from earnings of $6.4 million a year earlier. The downgrade does not include any loss arising from the Mainzeal receivership, which it said last week would hit its bottom line.
Chairman Rob Tait says the reduction is due to increased transmission costs, a provision made for a Commerce Commission required price decision, expected losses from its Aquaheat subsidiary and acquisition costs relating to the purchase.
Horizon also warned any mark to market changes in the value of its interest rate swap portfolio between this month and the end of the financial year may impact on the forecast.
The infrequently traded shares were unchanged at $3.40 on Friday and have gained 3 percent this year.