Orion reports lower earnings

Christchurch's Orion network has reported an $18.4m fall in profit on last year. Photo / Brett Phibbs

Christchurch-based power company Orion New Zealand Ltd has reported lower earnings for a year in which the community it served was shattered by earthquakes.

The company reported a $28.4 million net profit after tax for the year ended March 31, which was $11 million below its target and $18.4 million below its 2010 result.

The company spent $11m on repairs in the year to March 31 after the earthquakes in September and February, and a further $1.5m on other business continuity costs. Most repairs were to the 11,000 volt underground cable network in the eastern suburbs of Christchurch.

"This year we've worked alongside our owners -- Christchurch City Council and Selwyn District Council - to restore essential infrastructure to a region facing its biggest natural disaster,'' the company said.

The company maintains 13,600km of lines and cables to around 193,000 homes and businesses.

Earthquake repairs will continue for at least three years and Orion estimates that its total earthquake repair bill will increase to around $70m.

Since February, the amount of electricity used in Christchurch has dropped by 13 per cent, mainly due to people moving out of the damaged areas.

"We plan to spend an average of $65m each year for the next five years to restore, strengthen and expand the electricity network and support the Christchurch rebuild.

"We're also upgrading our network in rural areas, which now use twice as much electricity as a decade ago,'' said acting chief executive officer Geoff Vazey.

During the trading year, but prior to the February quake, Orion paid fully imputed ordinary dividends of $37.5m to its ultimate shareholders.

This brought total tax-free distributions to shareholders since corporatisation in 1993 to more than $1 billion.

- NZPA