Ann: FLLYR: MRP: Annual Results and dividend above IPO financial...

• Release Date: 20/08/14 08:41
• Summary: FLLYR: MRP: Annual Results and dividend above IPO financial forecasts
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					MRP
20/08/2014 08:41
FLLYR

REL: 0841 HRS Mighty River Power Limited (NS)

FLLYR: MRP: Annual Results and dividend above IPO financial forecasts

Annual Results and dividend above IPO financial forecasts

HIGHLIGHTS:

- FY2014 financial results above IPO forecasts; full-year dividend increased
to fully-imputed 13.5cps
- Earnings growth from new geothermal; Company benefits from choice of
renewable fuels
- Positive performance from differentiated retail brands amid intense
competition across all customer segments

Mighty River Power today reported FY2014 financial results above the
Company's IPO forecasts in a year marked by highly-competitive customer
pricing and the worst hydro inflows into the Waikato River hydro catchment in
the Company's history.

Along with the distinct advantage of having two large low cash cost renewable
fuels, Mighty River Power Chair, Joan Withers, said the Company continued to
apply a laser-sharp focus on business performance to deliver the 29% growth
in operating earnings (EBITDAF) to $504 million and net profit of $212
million.

Significant one-off and non-cash impacts in the prior year, largely relating
to costs and significant impairments from taking direct control of
international geothermal investments, saw a $97 million year-on-year lift in
net profit. After adjusting for these impacts, underlying earnings were up 3%
or $5 million on FY2013.

"The resilience from our low cash cost renewables provided the foundation for
delivering on our IPO forecasts, but this result for FY2014 required very
good decision-making from management to shape our portfolio and capture
further business efficiencies, while keeping our focus on delivering for our
customers.

"On top of the growth in operating earnings that we signalled for the final
full year of our IPO forecast period, the Company has had to adjust and
address some very real challenges in FY2014 - with our hydro inflows the
lowest in Mighty River Power's history and intense pricing pressure in the
market across all customer segments," Mrs Withers said.

Chief Executive, Doug Heffernan, said the Company's differentiated retail
electricity brands performed well as competition continued to intensify
across all residential and business segments. A particular highlight for the
year was increased customer loyalty for the Company's brands - in particular
Mercury Energy, which was 2% better than the market average for customer
switching (churn) across the industry in FY2014.

In the highly-competitive retail market, he said value-differentiated
services - including online and community channels - were becoming
increasingly important to customer experience and retention of customers.
Mighty River Power's average energy price for both its business and
residential customers was flat over the past year (in line with the IPO
forecast).

Dr Heffernan said the additional base-load electricity generation from the
new Ngatamariki station - which took geothermal production to 42% of the
Company's total - along with a conscious decision to reduce commercial
customer sales commitments - provided added flexibility for the business in
the use of limited hydro inflows to the Waikato Hydro System.

While hydro output and total generation for the Company (6,295GWh) was lower
than forecast and below FY2013, Mighty River Power achieved an average price
for generation that was joint market leading.

DIVIDEND AND OUTLOOK

Mrs Withers said the performance against the IPO forecasts, along with lower
capital expenditure in FY2014 - particularly relating to international
geothermal - meant that the Board saw it as appropriate to declare an
increased final dividend of a fully-imputed 8.3 cents (up 0.5 cents on the
IPO forecast) to be paid to shareholders on 30 September 2014.

This brings the total FY2014 dividend to a fully-imputed 13.5 cents per share
(4% above the IPO forecast, and 13% above FY2013).

She said the Company had today issued updated earnings guidance with FY2015
EBITDAF to be in the range of $495 million to $520 million - subject to any
material adverse events, significant one-off expenses or other unforeseeable
circumstances including hydrological conditions. Dividend guidance and an
update on capital management initiatives for FY2015 will be given at the
Annual Shareholders' Meeting in November.

Fraser Whineray will take up the role of Chief Executive on 1 September
following Doug Heffernan's decision to step down after 16 years with the
Company.

ENDS.

- This announcement is based on the audited consolidated financial statements
of Mighty River Power Limited for the year ended 30 June 2014. For more
detailed analysis and explanation please refer to the attached full year
financial statements

- EBITDAF and Underlying Earnings after tax are Non-GAAP measures. Please see
the Financial Commentary on these results for a reconsolidation of these
measures

For further information contact David Glendining (Head of Communications) Tel
0272 105 337 or Anna Hirst (Head of Investor Relations) Tel 0275 173 470.
End CA:00254085 For:MRP    Type:FLLYR      Time:2014-08-20 08:41:21