Genesis reveals strongest half-year result since listing

Genesis Energy owns the Huntly Power Station in the Waikato. Photo / Alan Gibson

Genesis Energy has released its strongest half-year result since listing in 2014 after strong retail margins and lower fuel costs helped boost its financials.

The power company, which is part-owned by the Government, announced earnings before interest, tax, amortisation and fair value adjustments of $217 million for the six months to December 31 - up from $167m.

Its net profit was $53m up from the $9m it made in the first half of its 2020 financial year.

Marc England, Chief Executive, Genesis Energy, said its retail business had delivered improved efficiencies.

"Our Energy IQ app now has 229,000 subscribers and, in 1H FY21, we launched advanced gas metering and new Energy Plus plans, which have already given 183,000 customers access to more customised payment options.

"The last six months has also seen a reduction in disconnections and bad debt, largely due to measures implemented by the business as part of its response to the customer impact of Covid-19."

England said its wholesale segment saw low hydro inflows and a volatile gas market which had affected electricity supply and prices.

"Huntly Power Station was again called upon to support the market in anticipation of a La Nina dry year. However, the high fuel costs that impacted the bottom line this time last year have moderated.

"The Waipipi Wind Farm entering the market in November has produced 54GWh of 100 per cent renewable, zero-emissions electricity as at 31 January 2021. It is due to reach its full 133MW capacity in March 2021, displacing 250,000-370,000 tonnes of carbon emissions annually."

England said the company had completed significant capital investment at the Tekapo B Power station during the half-year which had improved generation efficiency by 2.5 per cent.

It had also completed the $26.5m seismic intake gate which would enable the Tekapo power scheme to operate back at full capacity.

The company reduced its net debt to $1.182 billion and will pay an interim dividend up 8.6c per share, up from 8.525cps but has suspended its dividend reinvestment plan until further notice.

Genesis also revised its full-year EBITDAF guidance upwards from a previous range of $395m - $415m to $415m - $425m, subject to market conditions.