Merger strengthens Vector

By ELLEN READ

The Vector/UnitedNetworks merger has paid off, the lines company's interim profit rising 44.3 per cent to $29.3 million for the six months to December 31.

"The completion of integration of the two companies, ahead of time and budget, has seen significant operating efficiencies, particularly in the areas of multiple network operations, network systems and asset management," Vector chairman Michael Stiassny said.

Vector, owned by the Auckland Energy Consumers Trust, bought UnitedNetworks in September 2002.

Earnings before interest, tax, depreciation and amortisation (Ebitda) for the six months were $183.2 million, up from $115.3 million for the previous half year, in which just under three months of the merged operation were reported.

Stiassny said that although direct comparison to the previous interim result was difficult, ebitda as a percentage of overall revenue rose to 63 per cent from 59 per cent.

"This is an outstanding result given the company has just completed a significant merger which included a number of one-off transition costs," he said.

Vector had connection growth of 5 per cent on the gas network - due to strong regional population growth - and 2 per cent across electricity networks. Stiassny said the company's size and robust financial structure put it in a strong position to take advantage of growth opportunities.