Meridian Energy cuts interim dividend

Last updated 09:51 27/04/2012

Relevant offers

Wellington-based company Meridian Energy has cut its interim dividend by more than a quarter, blaming the impact of low rainfall on its South Island hydro lakes.

New Zealand's largest electricity generator, which derives most of its generation from hydro schemes in the lower South Island, said it would pay $71.3 million to the government for the six months to December 31.

For the same period last year Meridian paid an interim dividend of $94.2m, while a month later it paid a special dividend of $520m, part of the proceeds from selling the Tekapo hydro canals to Genesis Energy, a deal forced by the government.

''Low hydro inflows to Meridian's South Island catchments impacted the company's operating performance,'' Meridian said in a statement.

In February Meridian reported an underlying net profit after tax of $98.9m for the six months to December 31, a 20 per cent fall on the same period a year earlier. The company had earlier warned that low South Island hydro storage meant it could miss full year financial performance targets.

Chief executive Mark Binns said the result was sound.

''We're continuing our strong record of shareholder returns while ensuring we have sufficient capacity to fund our future growth plans.''

Yesterday Finance Minister Bill English said part of the reason that the government's finances had deteriorated further in recent months was a weaker outlook for profits from state owned energy companies.

''There's an assumption that the SOEs are some sort of guaranteed cash cow, but in fact they're not,'' English told Radio New Zealand this morning.

''Electricity demand is down, electricity company profits are down.''

Ad Feedback

- The Dominion Post


Special offers
Opinion poll

Would you like to see the Heathcote River cleaned up?

Absolutely, why does the Avon River get all the attention?

Yes, but only if it doesn't cost ratepayers too much

No, industry needs somewhere to dispose its waste

Vote Result

Related story: Alasdair Cassels to beautify Heathcote River

Featured Promotions

Sponsored Content