Vector underlying net profit slips

Vector chairman Michael Stiassny and chief executive Simon Mackenzie. File photo

Networks company Vector reported a 4.8 per cent rise in full year revenue to $1.24 billion, although underlying net profit slipped 0.8 per cent to $171.3 million.

Growth in electricity volume, a doubling of smart meter installations and a strategic deal with Transpower had underpinned a steady year, Vector said today.

In the year to June reported net profit was up 4.1 percent to $201.4m, with one-off items including a $30.1m contribution from the agreement reached with Transpower, and a $20.9m non-cash benefit from changes in the tax regime which decreased deferred tax liability.

A larger asset base and accelerated depreciation on certain asset classes increased depreciation and amortisation by $13.9m on the year before, Vector said.

Net interest costs were up $11.2m, reflecting higher interest rates, and a $6.6m one-off gain in 2010 arising from the repurchase of floating rate notes.

A final dividend of 7.5c per share was declared, taking the total for the year to 14.25cps, compared to 14cps the year before.

Electricity revenue and earnings before interest, tax, depreciation and amortisation (ebitda) rose due to good growth in volume despite unseasonably warmer temperatures in May and June.

Revenue improved 3.6 per cent to $574m, and ebitda was up 2.5 per cent to $364.6m.

Connections grew 0.8 per cent to 532,607, with 4362 new customers joining the networks.

Gas transportation revenue rose 5.6 percent to $205.1m, reflecting an increased contribution from gas transmission where volume grew 9.5 percent due mostly to a full year's contribution from the Kupe field.

Growth in new gas distribution connections improved 3 percent, and total customer numbers ended the year at 155,100 up 1.9 percent on 2010.

Ebitda declined 1.5 per cent to $157.3m reflecting higher cost of sales and a debt write-off.

Vector chief executive Simon Mackenzie said the company invested $257m in the business during the year, including $156m on electricity and gas infrastructure.

- NZPA