Mainzeal crash bad news for Horizon

Lines company Horizon Energy says its end of year profit will be dented by the Mainzeal receivership. Photo / The Star

Fallout from the Mainzeal receivership is hitting listed lines company, Horizon Energy.

The company says its wholly owned subsidiary, Aquaheat NZ is likely to incur a "significant adverse financial impact" following the appointment of receivers to Mainzeal Property and Construction.

"Aquaheat is owed money on a number of contracts with Mainzeal. The actual financial position is currently being assessed by Aquaheat's management, however it is clear there will be an impact on the Horizon Energy profit for the current financial year" said Horizon chairman Rob Tait.

He said the announcement came as a surprise.

"Contracts were proceeding as planned and as late as Tuesday this week we were engaged in discussions with Mainzeal personnel over current and future work without any hint of trouble," said Tait.

Aquaheat's engineering and contracting business, with offices in Auckland, Wellington and Christchurch were purchased in September 2012 and has been integrated into the Horizon Energy and is pursuing a range of business and growth initiatives.

Aquaheat's commercial building services include refrigeration, heating systems, fire protection, plumbing and drainage and specialist wall and roof cladding systems.

"We are on track with our business plans and the loss of this key long-term customer will be a serious set-back for Aquaheat."

Tait said Horizon Energy is committed to building a successful business model outside of its core electricity lines distribution business which is in the eastern Bay of Plenty.

"I expect we will have a clearer picture of our financial exposure as a result of this receivership within a few days once we have reviewed our commitments and obligations under the many contracts we have with Mainzeal. We will advise shareholders and the market as soon as we have more certainty," said Mr Tait.

Horizon's after tax profit was $6.4 million for the year ended 31 March 2012.