TrustPower profit inches up as fewer retail customers pay more
BUSINESSDESK: TrustPower, the utility controlled by Infratil, increased first-half profit as it managed to squeeze more from a dwindling customer base in an increasingly competitive market.
Underlying profit, which strips out one-off impairment charges and changes in the fair value of assets, rose to $76.2 million in the six months ended Septdember 30 from $75.6 million in the same period a year earlier, the Tauranga-based company says in a statement.
Net profit rose to $69.8 million, or 22.2 cents a share, from $68.8 million, or 21.8 cents, a year earlier.
Revenue rose 2.8% to $438.7 million, with retail sales rising 1.8% to $398.7 million. That came even as TrustPower shed 12,000 customers from a year earlier. TrustPower sold 1986 gigawatt hours in the period, down from 2137 GWh a year earlier.
"Retail competition remained intense during the period with customer switching continuing albeit some reduction in customer churn has been experienced toward the end of the period," the company says.
The board declared a full-imputed interim dividend of 20 cents per share, payable on December 14. The stock rose 0.5% to $8.50.
Earnings before interest, tax, depreciation, amortisation and fair value movements rose 2.8% to $166.1 million, mainly on trading gains from placement of generation to high-priced periods as well as the sale of electricity forward contracts through ASX when wholesale prices were firm, the company says.
New Zealand production fell 9% to 1292 Gwh because of lower hydro and wind production and is consistent with the expected long-term average, it says.
The average spot price of electricity generated was $97 per megawatt hours, up from $61 a year earlier.
In a separate statement, TrustPower warns bondholders it has been approached by a party seeking a copy of its bond register, which may lead to a low-ball bid being offered for the securities.