Genesis Energy's net profit fell to $131.1 million in the June year, down by 33% on the previous year.
Genesis Energy's net profit fell to $131.1 million in the June year, down by 33% on the previous year.
Genesis Energy said a “challenging operating environment” drove its earnings sharply lower over the June year.
The power generator and retailer’s net profit fell to $131.1 million, down by 33% on the previous year.
The company’s earnings before interest, tax, depreciation, amortisation and financial instruments came to $407.2m, down 22% from the previous year’s Ebitdaf of $523.5m.
The prior year’s performance reflected highly favourable hydro conditions.
“The operating conditions for 2024 were in direct contrast to the prior comparable period where near historic high hydro levels drove a record financial performance,” Genesis said.
Genesis said the latest result was hit by gas supply constraints, low hydro and wind levels and a seven-month unplanned outage of its gas-powered turbine at Huntly – Unit 5.
Malcolm Johns, CEO of Genesis Energy. Photo / NZME
Fuel costs were $169.5m higher, but the company said “99.9%” of Genesis customers were not impacted by the higher wholesale prices.
During the period, progress was made in delivering on its “Gen35″ strategy to substantially lift its investment in solar, grid scale battery storage and wind power, which is aimed at growing the renewable portfolio to around 8300 gigawatt hours (GWh).
The first stage of a new lower-cost retail operating model was implemented, a final investment decision was made on installing 100 MW/200 MWh of battery storage at the Huntly Power Station, a new site for a 127 MWp (megawatt peak) solar farm was confirmed, and negotiations were ongoing in securing a local and sustainable supply chain of biomass.
Genesis declared a final dividend of 7.0 cents per share, taking the annual declared dividend to 14.0 cps, down 21% on the previous year’s total dividend.
Expenses jumped by 10% to $363.1m.
Chief executive Malcolm Johns said Gen35 was focused on driving earnings growth from new investments by 2027.
He said Genesis had met its challenges “head on” over 2024 – a year that demonstrated the resilience of its generation portfolio.
Current market conditions - low lake levels and constrained gas supply - demonstrated that energy security was “non-negotiable” in a high renewables grid.
“The market conditions New Zealand is experiencing demonstrate the critical importance of energy security to the New Zealand economy,” Johns said.
“Over the next four years Genesis is targeting building 500 MW of new renewable electricity and freeing up 500 MW of baseload generation at Huntly to support energy security,” he said.
Looking ahead, Genesis expects Ebitdaf of around $460m in the 2025 financial year.
The company noted current volatility across electricity and gas markets and said this could result in a wider range of earnings outcomes.
