Mercury reports strong year-end financials thanks to record hydro generation

Mercury in New Zealand reported its operating earnings were up 7% this fiscal year, thanks to “record hydro generation for a second consecutive year.”

All results reported are for the 12 months up to June 30, 2018.

The company’s net profit after tax was up 27%, to $234 million, and its EBITDAF (earnings before interest, taxes, depreciation, amortization and foreign) was $561 million.

“The record result was significantly influenced by strong and timely hydro inflows across the Waikato River catchment, and high geothermal ability was maintained,” according to a press release.

Specifically, total hydro generation of 4,947 GWh for the year was 947 GWh (24%) ahead of average generation and up on FY2017’s record of 4,724 GWh. The lift in Waikato hydro generation increased New Zealand’s proportion of renewable electricity by more than 2%.

For shareholders, this translated to a final ordinary dividend of 9.1 cents per share.

Mercury’s chief executive, Fraser Whineray, said that sustaining high levels of operational performance while executing a number of key strategic projects puts Mercury in a strong position for the year ahead. Key projects during the year, according to Mercury, included a major ICT systems upgrade, completion of Metrix’s meter data project upgrade expanding its ability to provide certified half-hourly meter reads; hydro refurbishments at the Aratiatia and 104.4-MW Whakamaru stations (ongoing); and major maintenance outages at geothermal stations.

All of Mercury’s generation comes from hydro and geothermal sources. The company has nine hydro generation stations on the Waikato River.

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