Ann: FLLYR: TRP: Transpower releases 2014/15 annual result

• Release Date: 28/08/15 13:12
• Summary: FLLYR: TRP: Transpower releases 2014/15 annual result
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					TRP
28/08/2015 13:12
FLLYR
PRICE SENSITIVE
REL: 1312 HRS Transpower New Zealand Limited

FLLYR: TRP: Transpower releases 2014/15 annual result

Transpower New Zealand today released its annual results for the 2014/15
financial year.

Earnings before interest, tax, depreciation, amortisation, impairments, asset
write-offs, and changes in the fair value of financial instruments (EBITDAIF)
were $763.9 million, an increase of $47.4 million (+6.6%). The increase was
driven by increased revenue and lower operating costs.

Transmission revenue increased $43.7 million to $984.2 million (+4.6%) on the
prior period following the completion of our major capital build programme.
Operating expenses declined by 1.9% to $281.6 million, reflecting tight cost
control and initial gains from a number of business improvement and
efficiency initiatives being implemented across the company.

Net profit after tax, before net changes in the fair value of financial
instruments, was $194.6 million, an increase of $10.7 million (+5.8%) on the
prior period. The total dividend to be paid to the Crown for the 2014/15
financial year is $188 million.

Chairman Mark Verbiest said that the company had performed strongly over the
past twelve months, both financially and operationally.

"Reliability on the grid was the best performance achieved in the last ten
years and the grid managed well through a number of extreme weather events
throughout the year. This is due, in part, to the major investments
undertaken over the last five years that have built resilience and redundancy
into the grid, as well as continual improvements in our asset management
practices."

"With this major investment programme now complete, electricity consumers saw
a reduction in AC transmission prices from 1 April - on average, a 3.6%
reduction across the country," he said.

"A significant milestone this year was the completion of our first regulatory
control period. Our base capital expenditure programme delivered commissioned
assets of almost $966 million - 97% of the regulatory allowance. Operating
expenditure over the regulatory period was below our allowance due to a
continual focus on reducing costs in our day-to-day operations."

"We also completed the regulatory reset for our next five-year regulatory
control period (RCP2), which started on 1 April 2015. This period brings a
more challenging operating environment for our transmission business with a
lower allowable rate of return, challenging efficiency targets and more
comprehensive and complex incentive arrangements."

"Our focus on transformation programmes and implementing operational
efficiencies should place us in a good position to meet these challenges.
However, the changes to our regulatory and operating environment are likely
to result in our financial performance in 2015/16 being lower than 2014/15.
We are focused on maintaining our ability to deliver reliable transmission
services to our customers at an appropriate price point, while strengthening
our financial position in the long term."

Transpower's full annual report will not be available until tabled in
Parliament later this year. Our financial accounts are available at
https://www.transpower.co.nz/news/transpower-releases-201415-annual-result.

For further information, please contact:
Rebecca Wilson, Corporate Communications Manager, 04 590 6695 or 021 578 608
End CA:00269265 For:TRP    Type:FLLYR      Time:2015-08-28 13:12:36