Sharechat Logo

Mercury raises earnings outlook again as Taupo rain boosts generation

Thursday 14th June 2018

Text too small?

Mercury NZ has raised its earnings guidance for a fourth time as more rain around Taupo keeps the power company's North Island generation pumping out more electricity.

The Auckland-based electricity generator-retailer expects earnings before interest, tax, depreciation, amortisation, and fair value adjustments of $555 million in the year ending June 30, up from a previous forecast of $540 million which had already been upgraded three times on the inclement weather. Mercury reported ebitdaf of $523 million in 2017.

"This is due to an expected 200 GWh (gigawatt hours) increase in full-year forecast hydro generation due to continued wet weather in the Taupo area," the company said in a statement. "Annual hydro generation is now forecast to be 4,900 GWh for the financial year, or 900 GWh above average."

Mercury and Trustpower have enjoyed improved earnings outlooks for the 2018 financial year with rain patterns benefiting their North Island generation, while their rivals with large South Island hydro catchments contended with lower lake levels than normal. Things have improved for the South Island hydro lakes since the dry spring with dams back at more normal levels.

Separately, Meridian Energy, the country's biggest electricity generator, said its South Island hydro storage was at 117 percent of average and its North Island storage was at 138 percent as at Jun 13. National hydro storage was 120 percent of the historical average, it said. 

Meridian's May monthly inflow was 105 percent of the average in a mixed month where dry conditions were followed by unsettled weather later in the month. The company's hydro generation climbed 18 percent to 1,037 GWh in May from a year earlier, offsetting earlier declines which have seen year-to-date total generation 11,301 GWh, down 8.9 percent from a year earlier.

Mercury shares last traded at $3.38 and have increased 0.3 percent so far this year having recently completed a $50 million share buyback. Meridian stock last traded at $3.165 and has gained 9.1 percent so far this year.

(BusinessDesk)

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

MARKET CLOSE: NZ shares rise after bumpy week, led by NZ Refining, Synlait while Port of Tauranga, A2 drop
NZ dollar heads for 0.7% weekly decline as trade jitters weigh on markets
Mining industry says no more projects the size of Te Kuha, but smaller ones waiting
Goodman Fielder seeks ComCom permission to buy Yoplait rights in NZ
RBNZ's Orr tipped to stand pat and could signal hikes might take even longer
Consistency across port reporting would boost transparency, deputy Auditor-General says
Fletcher's Ross says no change to B+I provisions, won't comment on delays in Chch airport hotel
SeaDragon auditor PwC struggles to find evidence supporting asset valuations; withholds opinion
Education Ministry's leaky school claim against Carter Holt about a year away
NZ may produce record volumes of milk this season, Rabobank says

IRG See IRG research reports