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Mighty River Power produced a good result on all levels in the year ended June, including declaring a dividend 0.5c higher than forecast, Craigs Investment Partners broker Chris Timms said yesterday.
On Monday, another of the Government-controlled energy companies, Meridian Energy, also announced a larger dividend than previously forecast.
''Despite a materially negative second half, Mighty River ticks all the boxes for a good result.''
Operating earnings of $504 million beat the prospectus forecast by $6 million. The profit was driven by $30 million of cost reductions.
Only $20 million of those were permanent. In the previous corresponding period, operating earnings were $390 million.
Sales revenue was down 7% at 1.67 billion.
Reported profit of $185 million beat the latest guidance, which was $175 million to $185 million.
The dividend of 13.5c per share was higher than the forecast and if fully tax paid, equated to 98% of the reported profit.
''Capital management initiatives could lead to positive dividend payout changes or special or aggressive buybacks. An announcement will be made at the annual meeting,'' he said.
Among the negatives in the report were slightly higher capital expenditure for the 2015 financial year than Craigs had factored in for later years.
It was $145 million, including $50 million for the smart meter roll-out.
Mighty River chief executive Doug Heffernan said the year was marked by highly competitive customer pricing and the worst inflows into the Waikato River hydro catchment in the company's history.
Mighty River's average energy price for both business and residential customers was flat in the past year, in line with its listing forecast, he said.
Chairwoman Joan Withers said the improved performance meant the board could declare a final dividend of 8.3cps, taking the total to 13.5cps.
Labour energy spokesman David Shearer took issue with the size of Mighty River's after-tax profit, which rose by 84% to $212 million from the $115 million in the previous period.
Mr Shearer said the profit was ''simply outrageous'' when demand for electricity was flat or declining.
However, the accounts show in the previous period Mighty River had a write-down of $85 million for impaired assets, compared with nothing in the year ended June 2014 - boosting the reported profit.
Mr Shearer also failed to acknowledge the 31% reduction in operating costs gained by Mighty River.
Normalised earnings, which companies use to strip out unusual items, were $195 million for 2014 and $180 million for the previous period.