Vector profit falls but beats forecast
Energy company Vector has shrugged off price reductions imposed by regulators to beat market expectations, according to interim results released today.
Vector posted net profits after tax of $104.6 million for the six months to December 31.
While down 11.4 per cent on this time last year, it was well above analysts' estimates of $86m.
The results cover a period when the Commerce Commission cut the price Vector could charge for gas transport, and also the winding down of the Kapuni gas field.
Revenue fell 2 per cent to $658m.
The gas regulations were partly responsible for gas transportation revenues declining 8 per cent to $105m. Revenue from the electricity sector slid 2.5 per cent to $326m.
The sole area of growth for the company was the technology sector, where revenue rose 26 per cent to $67m, largely due to a rise in smart-meter installations.
Vector chief executive Simon Mackenzie said he had met market expectations and welcomed a review of regulatory arrangements under the Commerce Act.
"The regime is far from optimal," he said.
"Consumers do not appear to be benefiting from the price reductions Vector has made.
"Vector has implemented and weathered regulatory price resets. This, along with production constraints at the Kapuni has field, and the end of our entitlements to Kapuni gas at legacy prices have weighed on our financial results in the last six months."
Company chairman Michael Stiassny said the result showed Vector had "performed well".
"We also continue to seek better regulatory outcomes and to maintain and promote the health and safety of our employees and those who live and work and around our energy networks," he said.
Vector announced an interim dividend of 7.5 cents per share, up from 7.25c last year.