Infrastructure investor Infratil said it expected to build on its earnings momentum in the current financial year after producing a strong lift in its net profit for 2011/12.
Infratil, the brainchild of the late Lloyd Morrison, who died in February from cancer, said its net profit rose by 6 per cent to $127 million in the year.
The company, whose interests range from hydro-generation to airports in Europe, announced a final dividend of 5c a share, up 18 per cent on the previous final dividend. The dividend brings the total the year to 8c per share, up from 6.75c previously.
Derivatives have long been a part of Infratil's accounts, reflecting extensive use throughout the group of energy derivatives, interest rate swaps and foreign exchange instruments.
Infratil said momentum in the second half carried its earnings before interest, tax, depreciation, amortisation and movements in the value of financial derivatives (EBITDAF) to $520m, up 10.5 per cent compared with the previous year.
The result compares with Infratil's own forecast of EBITDAF - the company's preferred performance measure _-of $460m to $490m.
For the current 2012/13 year, Infratil forecast EBITDAF of $530m to $560m.
Infratil, which owns just over half of power generator and energy retailer, TrustPower, said the year had been one of "disciplined growth''.
Along with TrustPower, Infratil owns or has big holdings in Wellington Airport, NZ Bus and Z Energy, has energy assets in Australia and airports in Europe.
"In difficult markets it is tempting to chase market share, to postpone development, to harvest rather than sow,'' chief executive Marko Bogoievski said in a statement.
"Infratil and its businesses continue to balance the requirement to invest in the long term while delivering current performance and yield,'' he said.
Bogoievski later said in a conference call that the company had many moving parts, but most were moving in the right direction.
Rob Mercer, head of research at brokers Forsyth Barr, said there was an "air of confidence'' around the momentum that Infratil had built up in most of its businesses.
"Over the next few years, we see quite good profit growth out of the Z Energy, NZ Bus and TransPower,'' Mercer told APNZ.
But it was not all plain sailing for the group.
Management have initiated formal processes to sell Infratil's two remaining European airports _ Glasgow Prestwick and Kent.
Infratil Airports Europe has been classified as "held for sale'' and was disclosed separately in Infratil's books as discontinued operations.
This had the effect of increasing Infratil's reported EBITDAF by $12m in the 2011/12 year and by $11m in 2010/11.
Including $26 millon in impaired asset charges, the loss from these businesses came to $37m.
ogoievski said in the conference call that the company supported in principle the Government's plan to partially privatise its energy assets, but Forsyth Barr's Mercer said Infratil was not likely to be an investor in them because they would not fit the company's investment criteria.
Infratil's preference is for large or controlling stakes in a companies, which would be a problem under the mixed ownership model because of the Government's need to have a controlling stake.
Infratil shares last traded at $2.04, up 1c, having gained 10 per cent so far this year.
