Delay in payout from Marlborough Electric Power Trust
Electricity users in Marlborough will not get their share of profits from the Yealands deal before Christmas, but the payout will be worth the wait.
The Marlborough Electric Power Trust, which owns Marlborough Lines on behalf of the region's electricity users, passes profits from its investment in Yealands Wine Group to electricity users in an annual payout, however this year's payout has been delayed three months.
Trust chairman Ross Inder said the financial year for Marlborough Lines used to end on March 31, but it had been moved to June 30 to align with Yealands Estate Wines, with flow-on effects for distribution of profits.
The trust had to hold profits for six months so the money could be distributed to consumers tax-free, so instead of being paid in December, this year's dividends would be paid early next year, he said.
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"We've actually got the money in hand right now. We have to hold it for six months to enable us to distribute it to customers tax-free. It is a legal requirement of IRD that we do that, otherwise they would take a percentage as tax."
The trust purchased 80 per cent of Yealands Wine Group last year.
Dividends from the investment would be paid to Marlborough households through their electricity retailers in the form of credit on their electricity bill.
Electricity consumers received their first dividend, a $50 credit to their electricity accounts, in December.
The credit to be distributed early next year would be about $150 for each consumer, Inder said.
"The increase is merely due to increased earnings derived from Yealands. It's very positive. Their profit forecasts are very good, their performance has been right up to budget and better."
Inder could not say whether next year's dividend would be greater still.
"It depends on the market. But Yealands is a sound company with the potential for good performance."
The dividend would be paid in addition to the rebate each consumer received annually.
Marlborough Lines managing director Ken Forrest said in February the average domestic power customers would receive a rebate on their power bill of $226.38 from Marlborough Lines.
Inder hoped the rebate would be about the same time as the dividend, probably in February, he said.
The rebate would vary depending on how much power individual customers used, he said.
The total rebate for the region was expected to be $9.26 million, which would be paid to electricity retailers to distribute to customers connected to the Marlborough Lines network in March.
It did not matter which power company a customer was with, they would be paid a rebate as long as they were part of the network.
The timing of the rebate would depend on their individual billing cycle, he said.
Rebates paid to Marlborough Lines' customers since 1999 was close to $112m.
- The Marlborough Express