State-owned Meridian Energy made an after-tax profit of $173.3 million for the six months to December 31, up $164.1m, boosted by significant one-off items.

But operating profit was actually down 6 per cent to $277.1m in the past six months, and underlying bottom-line profit fell 11 per cent, excluding one-offs.

Meridian will pay a dividend of $99.8m to the government, reflecting 100 per cent of adjusted NPAT, excluding the one-offs..

Meridian said the much higher declared net profit reflected a good operating performance, but also significant one-off rises in non-cash derivative instrument values

This solid operating result was achieved despite a 33 per cent rise in transmission costs, dry-year hedges hanging over from last year and multiple high-voltage direct current (HVDC) outages associated with the Pole 3 upgrade of the national power grid.

There was a modest Ebitdaf decline of 6 per cent to $277.1m compared with the same period last year.

Adjusting for the effects of non-cash fair value movements and other one-off items, underlying NPAT was $88.3m an 11 per cent reduction on the same period last year.

Meridian's results have recovered strongly from the second half of the 2012 financial year, where record low inflows made for difficult operating conditions.

Ebitdaf for the six months to 31 December 2012 was 52 per cent higher than the six months to 30 June 2012.

Meridian's results have recovered strongly from the second half of the 2012 financial year, where record-low inflows made for difficult operating conditions.

Operating profit, Ebitdaf, for the six months to December 31, 2012 was 52 per cent higher than the six months to 30 June 2012.

This improved profitability can be attributed to increased water flowing into hydro lakes and better efficiencies in the company's core business, particularly in the retail business.

Meridians Chief Executive, Mark Binns, said Meridian returned to higher profitability this half year and is "on track to achieve significant full-year Ebitdaf growth".

The company's Australian investment strategy is progressing well. Construction started on Mt Mercer wind farm in December and Macarthur wind farm, a joint venture with AGL Energy, will begin to generate revenue this month.

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