The results also reflected a more diversified generation portfolio, with wind generation now complementing Mercury's hydro and geothermal generation, following the acquisition of Tilt's New Zealand wind operations in August and the commissioning of the northern section of the Turitea wind farm in December.
"This has been a year like no other," chief executive Vince Hawksworth said.
"We are embarking on a major period of growth and are well positioned to thrive in a rapidly changing world that is increasingly recognising the urgency with which we must decarbonise."
The number of large transactions made it difficult for analysts to get a true picture of how well the company did, but they said the result was in line with expectations.
"It was complex as their various acquisitions and divestments for parts of the period saw a lot of moving parts," Salt Funds managing director Matt Goodson said.
"It's interesting to see that like Contact, they are continuing to consider potential generation options," Goodson said.
"Even with cost escalation, current electricity market price signals are doing their job," he said.
Goodson said a resolution as to whether the Government's proposed pumped hydro Onslow project "would be helpful for investment decisions".
Onslow is being touted as a way to deal with the hydro-dominated systems' vulnerability to dry weather years, leaving the thermal generators to fill the gap.
In May, Mercury's acquisition of Trustpower's retail business for $467m went unconditional, making the company New Zealand's biggest electricity retailer by market share.
In its earnings outlook, Mercury said it was on track to exceed its three-year objective to increase the value of its business to $700m ebitdaf on a normalised basis. It has increased the ebitdaf target to $800m.
Mercury's 2023 ebitdaf guidance had been set at $580m, or $756m on a normalised basis.
Jarden's director of equity research, Grant Swanepoel, said the company's guidance is broadly in line with the broker's, but that there were many financial adjustments to digest.
Jarden has retained its "buy" rating, with a $7.00 target price.
Mercury shares last traded at $6.55.
The full year 2023 ordinary dividend guidance was 21.80 cents, a 9.0 per cent increase on 2022 and the 15th consecutive year of dividend increases.
Mercury chair Prue Flacks said the company had taken steps to build further diversity and resilience.
"Decarbonisation will underpin significant growth for Mercury over the coming decade.
"With a scale retail business now contributing substantial forward revenue and a strong portfolio of existing and prospective generation assets, we expect to meaningfully contribute to emissions reduction," Flacks said.
Mercury said mostly dry weather until June weighed on performance as it focused on lake management coming into winter.
Elevated electricity spot pricing persisted during the year but wet conditions across New Zealand from June had seen spot price levels ease as hydro generation displaces expensive thermal.
Forward electricity prices remained high over the medium-term reflecting the transition away from fossil fuels with high gas and coal prices as well as rising carbon prices, Hawksworth said.
High electricity spot prices meant Mercury was focused on completing the southern section of the Turitea wind farm by mid-2023 and developing new wind and geothermal generation.
The nearly $500m commitment to the ongoing refurbishment of Mercury's Waikato hydro stations continued, with the first turbine and generator replacement at Karāpiro station now under way.
Looking ahead, decarbonisation would shape much of Mercury's future activity.
"It will require collaboration between our industry, Government and officials to ensure that market and policy settings continue to evolve in a way that enables renewable energy development at the scale required," Flacks said.
New Zealand's total electricity supply is expected to be over 90 per cent renewable in the next 3-5 years.
Flacks said the Government's Emissions Reduction Plan "sends a clear signal" as to the collective effort needed to decarbonise.
