Friday 7th February 2003
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After only a year in the job the company's share price is at a five-year high. In fact, with the exception of a brief spike during 1997, it's the highest it has been since it was split off from Fletcher Challenge in 1992.
And this comes in the wake of the company's worst-ever year in 2001 when it lost $301 million after an astonishingly ill-conceived and executed foray into the electricity business.
Mr James, who took over from John Barton in January last year, lost little time dumping the rest of the power assets and kicking the balance sheet back into shape.
In September NGC sold its retail gas customers to Genesis Power for $61 million. In December it sold its 50% interest in the Southdown power station and its entitlement to the output of the Rotokawa geothermal plant to Mighty River Power for $39.5 million. The sales of the Taranaki Combined Cycle and Cobb hydro plants to Contact Energy and TrustPower respectively brought in $592.5 million.
NGC is now an "energy infrastructure and services" company operating the national gas transmission network, supplying about 500 industrial and commercial users and running LPG and gas processing facilities.
It is virtually debt-free. Standard & Poor's has indicated the sale of the generation assets is likely to result in a rating upgrade from the present A minus and a capital return to shareholders is on the cards.
Risks include the Commerce Commission's review of gas network regulation and NGC's reliance on Maui gas.
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