Ann: HALFYR: TPW: Trustpower Half Year Announcement

• Release Date: 03/11/14 09:06
• Summary: HALFYR: TPW: Trustpower Half Year Announcement
• Price Sensitive: No
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					TPW
03/11/2014 09:06
HALFYR

REL: 0906 HRS TrustPower Limited

HALFYR: TPW: Trustpower Half Year Announcement

Market Announcement
3 November 2014

Trustpower's consolidated profit after tax was $89.8 million for the period,
representing an increase of 16% compared with $77.2 million for the same
period last year.
Underlying earnings1 after tax excluding fair value movements on financial
instruments and one-off gains and impairment charges were $67.4 million
compared with $69.9 million in the prior period, a decrease of 4%.  Fair
value losses on financial instruments were $4.4 million for the period (prior
period was a gain of $10.1 million)  primarily due to decreases in long term
interest rates having a negative impact on the Group's portfolio of interest
rate hedges.  A $25 million gain has been included in the income statement
representing the difference between purchase price and fair value.  This was
determined by an independent valuation undertaken by the Group following the
acquisition of the Green State Power hydro and wind assets in New South Wales
in July this year.  This has been excluded from the calculation of underlying
earnings as it is considered to be one off in nature.
Earnings before interest, tax, depreciation, amortisation, fair value
movements of financial instruments and asset impairments (EBITDAF)2 were
$173.3 million, compared with $153.2 million achieved in the prior period
representing an increase of 13%.
Total electricity volume sold by the Company in New Zealand through mass
market retailing and time of use sales was 2,051GWh, compared with 1,831GWh
in the prior period, an increase of 12%.
Total energy accounts increased to 255,000 including 21,000 gas accounts.
Good progress was made in acquiring new customers in North Island metro
markets and Trustpower's multiproduct retail strategy continues to achieve
good momentum. Trustpower now has 15,000 more customers with two or more
services over prior period.
Telecommunications growth continued with customers increasing to 35,000 and
over 60,000 telecommunications services being provided.  While the retail
energy market remained highly competitive throughout the period, Trustpower
continued to experience lower levels of customer churn than the market
overall.
The Group's New Zealand generation production of 1,225GWh was in line with
the prior period but 8% below the expected long term average.  North Island
wind production was down 9% on prior period, while South Island hydro
production was up by 8%.
The Snowtown Wind Farm in South Australia produced 578GWh during the period
significantly higher than the 193GWh produced in the prior period as Snowtown
Stage 2 became fully operational during July 2014.
Final handover of the 270 MW Snowtown Stage 2 wind farm has occurred and the
wind farm was officially opened yesterday.  The project has been delivered
ahead of schedule, under budget and with an excellent health and safety and
environmental record. The final project cost is expected to be A$424 million
(excluding capitalised interest) around A$16 million below initial budget, an
excellent result for a project of this scale.
Group operating cash flow was $138.9 million for the reporting period versus
$118.9 million in the prior period.
Net debt (including subordinated bonds) to Net debt plus equity increased to
45% from 43% at 31 March 2014, as a result of increased borrowing levels to
finance the completion of construction at Snowtown Stage 2 and the
acquisition of the Green State Power assets.
Trustpower continues to maintain conservative levels of committed credit
facilities.  As at 30 September 2014 Group Net debt was $1,274 million.  The
Group has close to NZD equivalent 1.4 billion of committed debt facilities.
Trustpower has $75 million of senior bonds maturing in December 2014 and will
be shortly looking to refinance with a similar bond offer. More details on
the upcoming bond issue will be provided in a separate media release.
Trustpower is actively progressing other wind development options in
Australia with the aim of developing further wind projects to help meet the
Australian Mandatory Large Renewable Energy Target over the course of the
next five years.  Development approval applications for close to 1,300MW for
4 wind projects located in Victoria, New South Wales and South Australia are
being progressed on the basis that the Australian regulatory environment will
continue to support further renewable investment.
The outcome of the Australian Government's review of the Renewal Energy
Target remains uncertain but there appears to be growing support for the view
that a bipartisan agreement may be successfully concluded which should
provide greater investor certainty for future investments in renewable
energy.
Post signing of a long term service contract in June, Trustpower continues to
work with its smart metering service provider, Metrix, to ensure robust end
to end processes and systems are in place to facilitate the deployment of
smart meters and the provision of smart metering services to Trustpower's
mass market customer base. Although the project is still in set-up phase, it
is intended that services and a 3
year deployment project will begin in the first half of 2015.

The Directors are pleased to announce an interim dividend of 20 cents per
share, partially imputed to 12 cents per share, payable 12 December 2014
(record date of 28 November 2014).

BJ Harker
CHAIRMAN

Market Announcement
3 November 2014

Trustpower's consolidated profit after tax was $89.8 million for the period,
representing an increase of 16% compared with $77.2 million for the same
period last year.
Underlying earnings1 after tax excluding fair value movements on financial
instruments and one-off gains and impairment charges were $67.4 million
compared with $69.9 million in the prior period, a decrease of 4%.  Fair
value losses on financial instruments were $4.4 million for the period (prior
period was a gain of $10.1 million)  primarily due to decreases in long term
interest rates having a negative impact on the Group's portfolio of interest
rate hedges.  A $25 million gain has been included in the income statement
representing the difference between purchase price and fair value.  This was
determined by an independent valuation undertaken by the Group following the
acquisition of the Green State Power hydro and wind assets in New South Wales
in July this year.  This has been excluded from the calculation of underlying
earnings as it is considered to be one off in nature.
Earnings before interest, tax, depreciation, amortisation, fair value
movements of financial instruments and asset impairments (EBITDAF)2 were
$173.3 million, compared with $153.2 million achieved in the prior period
representing an increase of 13%.
Total electricity volume sold by the Company in New Zealand through mass
market retailing and time of use sales was 2,051GWh, compared with 1,831GWh
in the prior period, an increase of 12%.
Total energy accounts increased to 255,000 including 21,000 gas accounts.
Good progress was made in acquiring new customers in North Island metro
markets and Trustpower's multiproduct retail strategy continues to achieve
good momentum. Trustpower now has 15,000 more customers with two or more
services over prior period.
Telecommunications growth continued with customers increasing to 35,000 and
over 60,000 telecommunications services being provided.  While the retail
energy market remained highly competitive throughout the period, Trustpower
continued to experience lower levels of customer churn than the market
overall.
The Group's New Zealand generation production of 1,225GWh was in line with
the prior period but 8% below the expected long term average.  North Island
wind production was down 9% on prior period, while South Island hydro
production was up by 8%.
The Snowtown Wind Farm in South Australia produced 578GWh during the period
significantly higher than the 193GWh produced in the prior period as Snowtown
Stage 2 became fully operational during July 2014.
Final handover of the 270 MW Snowtown Stage 2 wind farm has occurred and the
wind farm was officially opened yesterday.  The project has been delivered
ahead of schedule, under budget and with an excellent health and safety and
environmental record. The final project cost is expected to be A$424 million
(excluding capitalised interest) around A$16 million below initial budget, an
excellent result for a project of this scale.
Group operating cash flow was $138.9 million for the reporting period versus
$118.9 million in the prior period.
Net debt (including subordinated bonds) to Net debt plus equity increased to
45% from 43% at 31 March 2014, as a result of increased borrowing levels to
finance the completion of construction at Snowtown Stage 2 and the
acquisition of the Green State Power assets.
Trustpower continues to maintain conservative levels of committed credit
facilities.  As at 30 September 2014 Group Net debt was $1,274 million.  The
Group has close to NZD equivalent 1.4 billion of committed debt facilities.
Trustpower has $75 million of senior bonds maturing in December 2014 and will
be shortly looking to refinance with a similar bond offer. More details on
the upcoming bond issue will be provided in a separate media release.
Trustpower is actively progressing other wind development options in
Australia with the aim of developing further wind projects to help meet the
Australian Mandatory Large Renewable Energy Target over the course of the
next five years.  Development approval applications for close to 1,300MW for
4 wind projects located in Victoria, New South Wales and South Australia are
being progressed on the basis that the Australian regulatory environment will
continue to support further renewable investment.
The outcome of the Australian Government's review of the Renewal Energy
Target remains uncertain but there appears to be growing support for the view
that a bipartisan agreement may be successfully concluded which should
provide greater investor certainty for future investments in renewable
energy.
Post signing of a long term service contract in June, Trustpower continues to
work with its smart metering service provider, Metrix, to ensure robust end
to end processes and systems are in place to facilitate the deployment of
smart meters and the provision of smart metering services to Trustpower's
mass market customer base. Although the project is still in set-up phase, it
is intended that services and a 3
year deployment project will begin in the first half of 2015.

The Directors are pleased to announce an interim dividend of 20 cents per
share, partially imputed to 12 cents per share, payable 12 December 2014
(record date of 28 November 2014).

BJ Harker
CHAIRMAN
End CA:00257128 For:TPW    Type:HALFYR     Time:2014-11-03 09:06:33