Trustpower produced an annual profit for the 12 months ended
March just better than expected and probably not good enough
to see any material upgrade in broker forecasts.
The company's operating profit of $277.4 million for the
period was down 5.9% from the $294.8 million reported in the
previous corresponding period.
Reported profit of $152.9 million was down 6.7% on the pcp
but 1.7% ahead of Forsyth Barr forecasts.
Forsyth Barr broker Andrew Rooney said that some ''slightly
negative'' figures below the operating line meant normalised
profit was only $2.3 million ahead of his forecast at $108
''There was no single area where TrustPower outperformed our
numbers. It was a combination of factors. Electricity revenue
was ahead by $2.4 million, predominantly made up from
Other revenue was up $1.8 million and although the reason was
not 100% clear, it was likely to be from irrigation revenue,
The outlook comments were limited, with a bland statement the
company expected earnings momentum to be regained in 2015 -
no big surprise given the completion of Snowtown II wind
TrustPower did say the wind farm continued to progress well
and 81% of the 90 turbines were now commissioned. There only
remained 10 turbines to be erected and the wind farm was on
schedule to be fully commissioned in September, two months
ahead of schedule, Mr Rooney said.
TrustPower chairman Bruce Harker said the company had
previously noted two significant events giving it cause to
reflect on the level of regulatory risk the group was exposed
to in New Zealand.
They were the Electricity Authority's proposals to revise the
current transmission pricing framework and the Labour-Green
proposal to abolish the current competitive wholesale and
retail market model and replace it with a single-buyer model.
''At this stage, it remains unclear whether the Electricity
Authority will push ahead with its reform proposals and a
final decision is not expected to be made until 2015.''
The Labour and Green parties had released little further
detail on the single-buyer model, Dr Harker said.
While the regulatory overhang of those issues continued,
TrustPower's views had not changed.
The group believed significant policy changes needed to be
''TrustPower and the electricity industry need a stable and
workable regulatory environment to work in. New Zealand can
ill afford dramatic regulatory and policy interventions that
cast aside the framework on which investors have made
long-term investment decisions,'' he said.