Transpower New Zealand reported a higher first-half profit as the state-owned company saw a rise in transmission revenue.

The Wellington-based company, which owns and operates the national grid that carries electricity around the country, said its profit before net changes in the fair value of financial instruments was $101.6 million in the six months to December 31, an increase of 2.6 per cent on the prior period. The increase largely reflects higher transmission revenue, which was up 3 per cent to $496.7m, it said.

"A continuing focus on tight cost control and an ongoing business transformation programme has seen the organisation perform well over the last six months," said chairman Tony Ryall.

The board declared an interim dividend of $66m, representing 40 per cent of the full-year dividend forecast in the 2016/17 Statement of Corporate Intent. It paid an interim dividend of $64.8m a year earlier.

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Capital expenditure was $109.7m for the first half of the year, up 9 per cent from the same time last year, it said.

Transpower also said it is considering an offer of unsecured, unsubordinated fixed rate bonds to New Zealand retail investors and institutional investors. It is expected the bonds will have a maturity of five and a half years, and full details of the offer will be released early March. Transpower has appointed ANZ Bank New Zealand as lead manager and organising participant in relation to the bond offer.