Contact Energy revenue up, profits slip

Tuesday 22nd February 2011

Contact Energy's first half underlying earnings after tax slipped slightly from a year earlier, as revenue rose 12% to $1.2 billion.

Contact managing director David Baldwin said the result was good given wet conditions during the six months to the end of December, and significant external cost increases.

The 12% rise in revenue was largely due to higher sales volumes and prices, while increases in network and gas costs as well as the onset of carbon costs resulting from the introduction of the emissions trading scheme, largely offset the revenue increases.

Underlying earnings after tax for the half year slipped 0.3% from a year earlier to $78.8 million, with profit after tax down 3.9% to $83.7 million.

An unchanged interim dividend of 11c per share is to be paid.

Baldwin said the company was expecting to benefit from developments that would improve its operational flexibility.

The developments included the completion of the Ahuroa gas storage project, along with the Stratford peaking project, expected to be in commercial operation in April, and a reduction in gas take or pay volumes from January.

Ebitdaf (earnings before net interest expense, income tax, depreciation, amortisation, financial instruments and other significant items) was expected to benefit from the increased operational flexibility in the second half of 2011 financial year.

First half ebitdaf edged up 0.2% from a year earlier to $225.5 million.

NZPA

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