Saturday , November 28 2020

Trustpower achieves modest half year profit



Energy company Trustpower, based in Tauranga, reported a smaller profit in the first half than last year's result as hydroelectric and wholesale prices returned to normal.

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Trustpower's net income for the six months to September 2018 was nearly $ 15 million less than the previous year.
Photograph: 123RF

Net income for the six months ended September was $ 64.9 million, compared with $ 79.3 million a year earlier.

Revenue was marginally higher at $ 512 million, while spending increased nearly 6 percent to $ 382 million as the cost of generating power increased.

Trustpower offers broadband and gas over electricity and has a growing number of customers buying two or more services.

Chief Executive Officer Vince Hawksworth said the diversified offer for customers is working and providing a more secure earnings base.

"Our numbers are also telling us that customers are more satisfied and less likely to leave when they buy more than just electricity from us," he said.

About 80% of new customers joining Trustpower buy more than one product.

He said the company continues to seek new services to offer such as mobile phones, and technological changes, such as solar panels, battery storage and power management systems, are future options.

Last year, the company took over the small US retailer King Country Energy, and Hawksworth said it believed there would be more rationalization among retailers.

However, he has little sympathy for complaints from small retailers, such as Flick Electric, which sells to consumers at wholesale spot prices. He accused large energy companies, such as Trustpower, of taking advantage of low lake levels, reducing gas supplies and relying on expensive coal generation to raise prices.

"They would say they would not do that, but you did not hear them complaining when prices fell to very low levels … it's about risk management and we do it for our customers," Hawksworth said.

Trustpower has a network of small-scale hydroelectric stations throughout the country. Last year, it sold three in Australia, whose proceeds will be used to pay 25 cents a share.

He reaffirmed his prediction for a full year with a profit between $ 215 and $ 235 million.


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