Windfarm profits battered by lack of wind

Last updated 13:43 28/02/2012

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Light windflows in the six months to December hit NZ Windfarms' ability to generate power and, as a result, its profits.

The NZSX-listed windfarm owner and operator has announced an after tax interim loss of $1.3m, despite a rise in wholesale electricity during the period.

However it was an improved result on the loss of $1.8m it made at the same time the year prior.

Chairman Wyatt Creech warned the two periods were difficult to compare because its Te Rere Hau windfarm was only completed in July, making this the first half-yearly period where it reported on the performance of the full 97 turbines in generation.

The wholesale price of electricity varied greatly between the half-year to December at $62.86/MWh on average and $43.24/MWh on average a year previously.

NZ Windfarms made $3.6m from electricity sales during the December 2011 half with the turbines generating 56.9MWh. A year earlier, it made $1.6m from 65 turbines generating 37.1MWh.

The turbines had performed well so far and had been available and ready to generate without any issues 97.1 per cent of the time, Creech said. This was higher than the manufacturer's expected 95 per cent availability.

An Environment Court hearing at Palmerston North City Council's request to determine if the noise from its turbines was within its resource consent allowances cost the company $322,000 in the period. A decision is expected by the end of March.

"We cannot predict the wind flow for the remainder of the financial year. Were that to improve so would our result. The same applies to wholesale electricity prices," Creech said.

Based on current forecasts NZ Windfarms was expecting a profit before depreciation, amortisation and tax of approximately $4.43m for the whole financial year, compared with a loss of $3.38m the previous year, Creech said.

After tax and expense, that would be a loss of $0.43m for the full year to July.

NZ Windfarms' shares were down 0.6 per cent to 17c at the time of writing.

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