State-owned Genesis Energy paid out a $114 million dividend
to the Government in the year ended June, nearly $10 million
more than its reported profit of $104.5 million.
The dividend is 34% of the operating profit of $336.4
million, and is a high percentage payout compared to most
Genesis is expected to be partially sold down by the
Government next year as it continues with its policy of
investing the proceeds of the state-owned assets sales into
the Future Investment Fund.
This year is the first time since 2009 the company has paid a
full dividend, reflecting its purchase of the Tekapo
hydro-electricity assets from Meridian Energy in electricity
reforms announced in 2010.
Perhaps with an eye to the potential for partial
privatisation before the 2014 election, Genesis said it
intended to pay a dividend consistent with, or in excess of,
the total dividend paid in 2013.
The accounts showed Genesis paid the dividend out of its
financing cash flows which were minus $127.9 million at
balance date, but improved from minus $290 million in the
previous corresponding period.
The company borrowed $120 million in the year and repaid $116
million of debt, $71.2 million of interest and other
financial lease liabilities and $57 million towards the total
Operating cash flow at balance date was $298.3 million, down
from $363.3 million in June last year.
The company reduced its gearing ratio (debt to debt plus
equity) to 34.5% from 36.2% in the year.
Genesis chief executive Albert Brantley said despite lower
operating earnings, the company's ability to deliver a
''solid result'' in difficult market conditions, including a
long dry summer, was a reflection of the company's effective
trading and focus on delivering practical options to
The company remained the country's largest energy retailer,
selling electricity, natural gas and lpg.
The diversity of the company's overall energy portfolio was
clearly demonstrated by the contribution made by the
company's 31% share of the sales for the year of operations
of the Kupe oil and gas field, he said.
During the year, Genesis completed the first stage of the
Tekapo canal remediation project within budget and ahead of
''The decision to invest between $145 million and $155
million was made to secure the company's ability to generate
electricity at both Tekapo hydro stations for years to
The second state of the project was scheduled for the next
summer construction season, Mr Brantley said.