KEY POINTS:
NZ Windfarms today reported a December half year net profit of $1.97 million against a $327,000 loss year earlier.
Operating revenue was $3m. It said revenue projected in the May 2007 prospectus for the full year will not be achieved due to the delay in commissioning of the
second stage turbines at Te Rere Hau near Palmerston North. The project, half owned by NZ Windfarms and half by NP Power & Babcock and Brown Windpower, is two months behind schedule.
However, the revenue shortfall will be more than offset by higher interest income as the project delays have meant that cash for the building programme has been expended at a slower rate than projected.
Chairman Derek Walker said the company had made good progress against the programme set out in the May 2007 prospectus.
Stage 2 of the Te Rere Hau wind farm is now expected to be completed in the third quarter of 2008.
"Consequently, the company can now begin turning its attention to growing and converting our pipeline of future developments into operating wind farms."
Te Rere Hau experienced a number of "relatively minor issues" with the stage 1 turbines.
"This is not surprising given that we had very deliberately located stage 1 on to the windiest part of the property with the intention of robustly testing the Windflow 500 (turbines) before moving onto the next stages of the development," Mr Walker said.
All issues had been resolved by turbine supplier and sister company, Windflow Technology.
The most significant of these issues resulted in the upgrading of all five of the stage 1 gearboxes. A significant number of turbine operating hours were lost during the period, resulting in $28,000 of lost revenue.
Commissioning of the 28 turbine stage 2 is scheduled to start in the second quarter and generation will begin in the third quarter.
Mr Walker said NZ Windfarms expects to catch up on the build programme by moving almost immediately on to the erection of the stage 3 turbines.
A new foundation design that uses 40 per cent less concrete and reduces earth works by two thirds is being tested.
The Te Rere Hau joint venture intends seeking resource consent to add up to a further 37 turbines to the 97 turbines currently consented.
The company said it was consulting with the local community before lodging its application.
The company is continuing discussions with Mighty River Power on developing wind farms.
NZ Windfarms has decided to increase its investment in Windpower Maungatua from 16 per cent to 50.
"Maungatua holds the development rights to a promising farm in Otago and our decision to increase our investment follows positive feasibility studies conducted at the site," Mr Walker said.
The site had potential capacity for about 20 megawatts, making it a little under half the size of Te Rere Hau wind farm.
No dividend will be paid.
NZ Windflow shares were down 1 cent to $1.01. They have slumped from $2.25 in May.
- NZPA