Winter crisis weakens TrustPower

By CHRIS DANIELS

TrustPower has announced an after-tax loss of $12.2 million for the six months to October, down dramatically from the $16.8 million profit it earned in the same period last year.

Chairman Harold Titter said the winter power crisis had a "significant negative effect" on the company's short-term profitability.

Power companies with not enough generation to match their retail customer commitments did particularly badly during the winter.

TrustPower has 16 per cent of all consumers, but generates only 5 per cent of all New Zealand's power.

A combination of drought in the Central North Island and low inflows into South Island hydro lakes meant TrustPower generated 14 per cent less electricity than normal.

This, coupled with high power demand from its retail customers, forced it to buy electricity on the wholesale spot market, at prices five to 20 times normal.

Mr Titter said hydro flows in the North Island had returned to normal, and those in the South Island, while still below average, had improved since winter.

However, lake levels remained low and further volatile high electricity spot prices could not be ruled out.

Mr Titter said as things were now returning to normal, TrustPower would pay a dividend of 6c a share for the six months.

This dividend, which will be paid on December 19 to all shareholders registered on December 7, will not carry imputation credits.

TrustPower, which has 280,000 retail power customers and is New Zealand's fifth-largest electricity generator, is owned by four main shareholders - Infratil, with 28.4 per cent of shares; the Tauranga Energy Consumer Trust, 24.5 per cent; US energy company Alliant, 19.1 per cent; and Australian Gas Light, 14 per cent.

Its shares closed unchanged yesterday at $3.22 each.