Mighty River Power has become the latest electricity generator-retailer to announce a special dividend in the current earnings season, at the same time as announcing a 22 per cent fall in underlying earnings after tax for the year to June 30, of $145 million.
Auckland-based MRP, which operates as a retailer under the Mercury Energy brand, took a $127 million one-off hit to its net profit after tax through writedowns after exiting international geothermal investments and from the decision to close its Southdown power station in Auckland. Those were the main factors behind a 76 per cent fall in net profit to $47 million.
Earnings before interest, tax, depreciation, amortisation and changes in the value of financial instruments (ebitdaf) were down 4 per cent to $482 million and represented a "robust result in challenging conditions", said chief executive Fraser Whineray. In the current financial year, MRP is forecasting an ebitdaf surplus of between $490 million and $515 million.
The company will spring another 2.5 cents per share special dividend for shareholders, having already declared a 5 cents special payout in December last year. On top of that, a final dividend of 8.4 cents takes ordinary dividends for the year to 14 cents, up 4 per cent on the previous year, with guidance given to expect a further 2 per cent increase in the current financial year of 14.3 cents.
"The board is pleased to be returning a total of $296 million to MRP's owners for the year, representing a 59 per cent year-on-year lift in cash returns," said the company's chair, Joan Withers.
