Contact Energy says it's "not fixated" on the number of redundancies it will make but is still on track to shed 10 per cent of staff.
Chief executive Dennis Barnes said talks had begun with staff about the size and shape of the business, coming to the end of a $2 billion investment programme during the past five years.
He said early desk-top work suggested about 10 per cent of the 1100 staff could go. "We're not fixated on that number. We're looking at the long-term and at the returns we get on our investment - they're still not great."
The $700 million Te Mihi geothermal project would be finished within the next six months, the final project in the big capital programme.
"What we're seeing from an outlook perspective is continued intense competition in retail as a result of generation oversupply, and that causes us to pause and think our business has been sized for a large development pipeline."
The company's first-half, after-tax profit rose 29 per cent to $88 million despite flat demand and shrinking margins on retail electricity sales.
The company will pay a fully imputed interim dividend of 11c, representing a payout ratio of 87 per cent of its underlying earnings after tax.
Revenue for the six months to December 31 was $1.213 billion, down 5 per cent on the same period a year earlier, although operating expenses fell 9 per cent to $960 million.
Earnings before interest, tax, depreciation, amortisation and changes in the value of financial instruments of $253 million was up 10 per cent on the same period last year.
Barnes said investments in gas storage and fast-start, gas-fired peaker plants were proving themselves for their ability to allow the company to take advantage of low wholesale prices.
He said there would be intense competition for retail market share this year and volume was important.
"In a retail market where 30,000 customers per month switch supplier we have been successful at retaining a stable market share in both the mass market and commercial and industrial markets. We will continue our focus on winning and keeping customers."
He said more customers were moving online to on-time discounts and more sophisticated offers in future would including loyalty programmes and options to package a number of products.
Contact shares yesterday closed up 17c, or 3.35 per cent, at $5.25.
*23 per cent of retail market supply.
*25 per cent of power generated.
*11 power stations.