A dip in Waikato farm prices has hit Transpower's balance sheet, forcing it to write off $20 million of its property portfolio during the past year.

It yesterday reported an 11 per cent fall to $126 million in annual earnings.

The state-owned enterprise spent about $200 million on dairy farms, grazing land and lifestyle blocks through Waikato and the southeastern outskirts of Auckland for its transmission line project about five years ago, near the top of the farm price boom.

However, the fall in land prices meant it had to cut the value of its holdings. In the previous year the impairment had been $30 million.

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General manager of corporate services Howard Cattermole said Transpower had been forced to buy properties when negotiations for easements over land for the North Island grid upgrade became difficult.

"When the project was struggling to get momentum the decision was made to purchase properties and register the easements and then resell the properties. As a consequence we acquired a pretty significant property portfolio."

Transpower still holds the bulk of about 80 properties.

The market was "not buoyant" but three or four properties were selling each month.

Chairman Mark Verbiest said dividend payments to the Crown would restart in the 2011-12 financial year, a year earlier than previously planned.

Earnings before net changes in fair values of financial instruments fell from $142 million to $126 million in the year to June 30.

Transmission revenue was $675 million, an increase of 3 per cent, reflecting the commissioning of new investments in the grid.

However, that revenue was less than forecast because of a reduced regulated return set by the Commerce Commission and the deferral of the planned commissioning date for the new inter-island link, Pole 3, to the end of next year.

The reduction in revenue was partly offset by $9 million in income from copper recycled from the dismantled Arapuni-Pakuranga line and a strong trading performance by the company's Australian subsidiary, d-cypha Trade.

Operating costs increased by 6 per cent, or $15 million, which the company said was "very satisfactory" and included a $6 million increase in planned maintenance.

Cattermole said capital spending was to increase from $733 million in the past year to $850 million in the current year and the same amount in the next.

Around $5 billion would be spent over the next 10 years.