Infratil profit jumps on Shell, Australian assets

Signaged for the new Z branded petrol stations Photo / Sarah Ivey

Infratil, the infrastructure investment company, lifted profit by more than two-thirds as its Shell and Australian assets made big contributions to the firm's bottom-line. The shares climbed 1.6 per cent.

The Wellington-based company made a net profit of $183.8 million, or 10.7 cents per share, in the 12 months ended March 31, up from $110.1 million, or 5.2 cents a share, a year earlier. Underlying earnings gained 27 per cent to $459.6 million, beating expectations, and Infratil expects growth of between 4 per cent and 11 per cent in the next financial year.

"The economic and regulatory backdrop was generally difficult and all of Infratil's businesses faced material challenges," the company said in a statement.

"Indications of the future are more positive."

The shares rose 3 cents to $1.93, leading the NZX 50 Index higher at the open of trading, and are down 1 per cent this year.

The directors declared a final fully-imputed dividend of 4.25 cents a share.

During the year, the Shell assets, which have been rebranded as Z Energy, contributed $55 million to earnings before interest, tax, depreciation, amortisation and fair value movements, while Infratil Energy Australia injected $55 million compared to $11 million a year earlier.

Electricity retailer TrustPower Ltd. made the biggest contribution to earnings with $274 million, while Wellington Airport added $72 million. NZ Bus lifted its contribution by a quarter to $40 million.

Infratil's European airports posted a loss of $11 million in the financial year.

The company talked down the likelihood of more capital investment after spending some $500 million in the 2011 year, almost half of which went into the Shell assets.

"A number of divestment and investment transactions are in development, but the large reallocation of capital which occurred over the last two years is unlikely to reoccur in FY12," the company said.

"The focus will be on growing through in-house investment opportunities while focusing on operational performance so earnings increase."

Infratil's dated debt as a proportion of capital rose to 39 per cent from 32 per cent a year earlier, while the ratio of bank debt to capital increased to 10 per ce from 4 per cent.