Vector, the Auckland-based electricity and gas distributor, posted a 7 per cent gain in first-half profit, driven by stronger sales, lower finance costs and a one-time gain after a Court of Appeal ruling on a tax claim.
Profit rose to $107 million in the six months ended December 31 from $100m year earlier, Vector said in a statement. Sales rose to $626m from $591m.
Vector's earnings included a $15m gain as a result of a Court of Appeal judgment in its favour in a dispute with the Inland Revenue Department over the tax treatment of payments from Transpower for access to parts of Vector's Auckland electricity network including a tunnel and a series of land rights. First-half profit from continuing operations jumped 65 per cent excluding the contribution from Vector Gas, which was sold for $952.5m with proceeds used to repay $610m of debt.
Chairman Michael Stiassny affirmed that full-year adjusted earnings before interest, tax, depreciation and amortisation would be broadly in line with the 2016 result of $473m, at the top end of its guidance last August of $460m to $475m. Adjusted ebitda in the first half was $257m.
Vector breaks down its results to its regulated and unregulated businesses. Adjusted ebitda for its continuing regulated networks business fell 0.4 per cent to $195.7m, which it said reflected a 19 per cent increase in new electricity and gas connections, offset by the impact of warmer weather and "the continuing decline in household power consumption."
