Genesis Energy lifts half year net profit to $64.6m

Genesis Energy's Huntly Power Station. Photo / Amos Chapple.

State-owned Genesis Energy lifted half year net profit to $64.6 million, compared to $48.9m a year earlier, even as it generated less electricity and prices fell.

The company said additional revenue from frequency keeping - maintaining the desired wave frequency in the power system - and attention to operating expenses had contributed to the result.

It was achieved against an electricity market back-drop of variable wholesale prices and high inflows of water into the country's hydro storage lakes, Genesis said.

Operating revenue for the six months to December was down to $961.4m from $1.04 billion in the corresponding period in 2008.

Revenue from external wholesale electricity sales dropped to $269m from $354m due to lower generation volumes and lower wholesale prices. Revenue from retail electricity and gas sales was static at $682m due to aggressive competitor activity in both markets, the company said.

Generation output in the six months of 3919 gigawatt hours (GWh) was 411GWh less than the comparable period a year earlier with both renewable and thermal generation volumes down.

The average price received for generation output in the half year was $51 a megawatt hour (MWh) compared with $77 MWh for the same period in 2008.

Genesis Energy chairman Jenny Shipley said the result reflected the company's focus on driving greater commercial returns on its assets for its shareholder.

Chief executive Albert Brantley said shareholder value was being achieved by revising the asset management programme of generation assets and ensuring its retail load profile was aligned with its generation and trading strategies.

Genesis' assets include the Huntly thermal power station, hydro stations at Tongariro and Lake Waikaremoana, and the Hau Nui wind farm in the Wairarapa.

During the latest half year commissioning started at the Kupe oil and gas field, with first sales gas and condensate being processed. All Kupe's natural gas is contracted to Genesis, which has a 31 per cent stake in the venture.