Vector chair Dame Alison Paterson said revenues continued to benefit from strong connection growth across networks and the further expansion of the metering business in New Zealand and Australia. These gains were partially offset by increased maintenance to improve electricity network reliability.
Vector
Vector's shareholders will receive a partially imputed half-year dividend of 8.25 cents per share, the same as last year.
When the Vector board approved the current dividend policy in 2017 it was noted that the policy would be reviewed in light of Vector's revenue of the Commerce Commission's default price-quality path regulatory reset (DPP3) for Vector's electricity network.
The DPP3 period comes into effect from April 1, this year.
"The board has decided to move from a progressive dividend policy of increasing dividends by 0.25 cents per annum, to a policy of maintaining the current dividend of 16.5 cents per annum with the expectation of continuing to increase dividends in the future based on projected growth in Vector's businesses," said Paterson.
This will affect Vector customers who live in the Entrust area.
Vector will attach imputation credits to dividends at a rate of 10.5 per cent.
The company was last year fined for not earlier meeting service standards and Paterson said it had invested significant capital to improve asset reliability, support growth in Auckland, as well as investment to support increasing deployment of advanced meters.
Total capital expenditure in the first six months has been $240m, an increase of $38.9m or 19.3 per cent on the prior period.
Landmark decisions during the period, particularly confirmed regulatory settings and the sale of the Kapuni Gas Treatment Plant to Todd Energy, have helped further refine Vector's outlook and direction.
Vector chief executive Simon Mackenzie said that due to recently confirmed regulatory settings, it was limited in how much it could invest in growing and maintaining networks to keep pace with Auckland's rapid growth, while also addressing additional pressures driven by the electrification of transport and changing customer behaviour.
Vector "remained committed" to meeting its regulatory compliance targets with a number of initiatives focused on improving restoration times. This included commissioning a new equipment depot in Helensville to help speed up restoration efforts in the North and West of Auckland.
For the nine months ending December 2019 outage minutes were 13.7 per cent lower than the comparable period, which reflected the significant investment being made to improve network resilience, as well as fewer extreme weather events, he said.
Adjusted ebitda for electricity and gas distribution in the six months to December 3, 2019 was down $9.5m to $189.2m – a 4.8 per cent decrease compared with the prior period.
During the period Vector also invested regulated capex of $156m to lift network integrity and enable Auckland growth.
Adjusted ebitda for the Metering segment was $76.1m up $8.0m or 11.7 per cent from a year earlier.
Metering capex invested in the first half-year increased by 8.9 per cent to $65m, with most of this increase reflecting the acceleration of deployment of new advanced meters in Australia.
Gas trading business' financial performance in the six-months to December 31, 2019 saw adjusted ebitda flat at $20.8m.
Vector's Ebitda guidance for the 2020 financial year is $495m to $505m, which is higher than last year's full-year adjusted Ebitda of $485.8m.
