Mercury annual profit triples after sale of Tilt shareholding
Tuesday, 16 August 2022
Mercury annual profit triples
Increases three-year profit target
Forecasts higher dividend
Power company Mercury's full-year profit more than tripled thanks to the sale of its shareholding in Tilt Renewables.
Net profit jumped to $469 million in the year to June 30, from $141m the previous year, Mercury said in a statement to the NZX. The profit included a $367m gain on the sale of its Tilt holding to an Australian consortium.
Mercury has been expanding its operations, having bought Trustpower’s retail business and Tilt’s New Zealand wind farms, which added wind to its existing hydro and geothermal generation.
“This has been a year like no other. In less than 12 months, we have become New Zealand’s largest wind generator after having no operating wind generation at the start of the year. We’ve also become New Zealand’s largest electricity retailer,” said Mercury chief executive Vince Hawksworth.
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“We are embarking on a major period of growth and are well-positioned to thrive in a rapidly changing world that is increasingly recognising the urgency with which we must decarbonise.”
Mercury lifted its operating profit to $581m from $463m, which it said reflected the addition of wind generation and performance improvements in its core business.
The company increased its three-year target for underlying operating profit to $800m from $700m, and said it expects operating profit of $580m this year, or $756m on an underlying basis.
Mercury will pay a final dividend of 12 cents per share, taking the full-year payment to 20c, ahead of a 17c payment last year. It expects to pay a 21.8c dividend this year.
Shares in Mercury lifted 0.6% to $6.58 in mid-morning trading on the NZX. The stock has gained 9% so far this year.