Meridian profit boosted by wind farm sale

Meridian Energy's full year underlying profit was $162.7 million, up 53 per cent on last year. Photo / NZPA

Meridian Energy has made a net profit of $295 million, benefiting from the sale of a wind farm in Australia.

The state owned enterprise - which last week concluded an supply deal with its biggest customer Rio Tinto subsidiary New Zealand Aluminium Smelter - said its full year underlying profit was $162.7 million, up 53 per cent on last year.

Earnings before interest and taxation, depreciation and amortisation and fair value adjustments (EBITDAF) was up 23 per cent from last year at $584.8 million, according to results released by the company today.

The company is slated to be partially sold later in the year and said it would pay a final dividend of $152.6 million to the government.

Meridian is the country's biggest generator, mainly from from its hydro system, and said inflow levels were closer to its historical average than record low inflows experienced in 2012.

"The result is pleasing as Meridian has shown its resilience in testing market conditions, including an extremely dry period over the summer months, while maintaining its focus on the ongoing negotiations with the owners of the Tiwai Point smelter and continued preparations for Meridian's potential partial listing later in the year," said Meridian chief executive Mark Binns.

The result was influenced by overall improved earnings and the sale of the Macarthur wind farm in Australia in June, which resulted in a $101 million pre-tax gain, and a $6 million gain on the sale of the company's subsidiary Energy for Industry.

During the year the company managed significant market disruptions including low inflows into Meridian's South Island hydro catchments, a three month Tekapo canal outage and 42 days of HVDC outages to support Transpower's Pole 3 commissioning project.

Binns said the retail Meridian and Powershop brands performed strongly.

Meridian Retail performed well with net contracted revenue increasing by 3 per cent on last year's performance, through improving its portfolio mix.

Powershop, had a positive year with an increase in sales and a 7 per cent increase in customer connections and entered the Victorian market during the year.

It said its pipeline of further development has been rationalised in response to a softer market and no projects were expected in the next three to five years.

Net profit in last year was $75 million and in 2011 was $303 million.