Infratil's revenue down 3.2% in 'strong result'

Diversified utilities investment company Infratil has posted a 3.2% decline in operating revenue, cushioned by strong performances from its stakes in Trustpower, Wellington Airport and Canberra Data Centres.

In the trading year to March, the New Zealand-based company's operating revenue declined 3.2% from $1.78billion a year ago to $1.73billion, while earnings before interest, tax, depreciation, amortisation and financial instruments (ebitdaf) rose 6% to $552.4million.

Earnings before interest and tax (ebit) rose 8% to $358.6million, while net profit fell from $66.1million a year ago to $60.5million.

The company reiterated its forecast for 2019 normalised ebitdaf in a range of $500million to $540million, compared with $488million in 2018.

Infratil said in a report the 3.2% decline in operating revenue was largely from the loss of transport contracts by NZ Bus and lower wind volumes through Tilt Renewable wind farm assets in New Zealand and Australia; the latter offset by higher electricity generation by Trustpower.

Infratil shares rose 0.7% to $3.24 following the announcement, being up 7.5% on a year ago. Its dividend rose from 10c per share a year ago to 10.75c. The full-year dividend was up from 15.7c to 16.75c.

During the year, Infratil spent $325.9million on investments, down from $728.2million the year before, and still had $533million in cash and undrawn loan facilities.

Forsyth Barr broker Suzanne Kinnaird said overall it was a "strong result".

"There was good growth from Canberra Data Centres and ANU Accommodation, while Perth Energy was showing some recovery," Mrs Kinnaird said.

"RetireAustralia is the only real disappointment," she said.

Craigs Investment Partners broker Peter McIntyre said the "reasonable result" was at the top end of earlier guidance.

"Most of the businesses reported well, except Perth Energy and AustraliaRetire, which disappointed," he said.

Infratil said additional capital had been provided to RetireAustralia to enable it to double its rate of development - it has two urban villages under construction and 260 new dwellings in the planning stage.

Mr McIntyre noted Longroad Energy's loss reflected a full year of development expenditure.

Also in Australia, Infratil said Tilt Renewables had begun construction of a wind farm in Victoria and had a contract for the future electricity output.

Infratil said each of new investments, Canberra Data Centres, Longroad Energy and ANU Student Accommodation, had performed above expectations.

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