INDEPENDENT NEWS

TrustPower says 2014 earnings will lag behind 2013

Published: Mon 11 Nov 2013 01:55 PM
TrustPower says 2014 earnings will lag behind 2013 on investment spending, softer NZ market
By Tina Morrison
Nov. 11 (BusinessDesk) – TrustPower, the utility controlled by Infratil, expects earnings this year will lag behind the 2013 financial year as the power company invests more and is hurt by a soft New Zealand market.
The Tauranga-based company signalled the drop in earnings in investor briefing notes released to the stock exchange. It didn’t provide further details although estimates compiled by Reuters shows analysts expect earnings to drop to $122.1 million in the current year, from $127.3 million in 2013.
TrustPower said it is facing a challenging retail environment in New Zealand with lower customer demand and pressure on margins. The company is ramping up spending on its Snowtown wind farm in Australia which it expects to be on budget and delivered one month ahead of schedule.
Capital expenditure is expected to jump to $360 million in the 2014 financial year, including $325 million relating to the Snowtown Stage 2 construction, the company said today. That’s up from total capex of $198.6 million in 2013 and in line with analyst expectations for 2014 of $355 million, according to Reuters.
TrustPower said it is delaying a decision on whether to sell its Snowtown Stage 2 South project until the total Snowtown Stage 2 project is completed. It expects to commission the total Stage 2 by August 2014 with handover scheduled for October 2014.
The company is reviewing its options for capital raising to develop more wind generation and is likely to extend its shorter term Australian bank debt maturing in September 2014 to allow it time to make a decision.
To bolster its New Zealand retail business, TrustPower is refreshing its brand, acquiring regional rivals, using technology to improve customer experience, selling combined telecommunications and gas services and considering entering urban and retail markets, the company said today.
Shares in TrustPower added 0.2 percent to $6.63, and have shed 22 percent this year. The stock is rated a ‘buy’ according to the consensus of six analysts polled by Reuters.
(BusinessDesk)

Next in Business, Science, and Tech

General Practices Begin Issuing Clause 14 Notices In Relation To The NZNO Primary Practice Pay Equity Claim
By: Genpro
Global Screen Industry Unites For Streaming Platform Regulation And Intellectual Property Protections
By: SPADA
View as: DESKTOP | MOBILE © Scoop Media