Meridian Energy pays $300m dividend

Thursday 2 November 2006

Meridian Energy pays $300m dividend

State-owned electricity generator and retailer Meridian Energy has paid the Government a $300 million dividend for the 2005-06 year.

Chairman Wayne Boyd says the company’s recent excellent financial performance and its wish to maintain an efficient balance sheet make the dividend an appropriate step.

“We are pleased to deliver this dividend to our shareholder as a result of the company’s success and as a sign of its strong prospects for the future.”

The payment follows a special dividend of $800 million paid to the Government in May, largely the result of its highly profitable foray into Australia with the sale a year ago of its Southern Hydro assets.

Under Meridian’s Statement of Corporate Intent the company’s target dividend ratio is 65 percent of net profit after tax.

However Mr Boyd says Meridian is able to pay well in excess of that amount because of the exceptional results it achieved in 2005-06 and its commitment to make the best use of shareholder funds consistent with its obligation to be as efficient and effective as its private sector competitors.

“Meridian is a successful company in terms of the value it delivers both to its customers, and to its shareholders – all the people of New Zealand. We have kept our rate of price increase at close to the rate of inflation for the last two years, and our increases are among the smallest – if not the smallest – in the market.

“At the same time we have been able to deliver more than a billion dollars in dividends to New Zealanders. That is a record to be proud of.”

Despite the dividend payments, Meridian is still well able to support its commitment to New Zealand’s leading renewable generation development programme, with several wind and hydro projects either under construction, or at varying stages in the resource consent process.

These include the 58 megawatt (MW) wind farm at White Hill in Southland and the Manapouri refurbishment currently under construction, the 210 MW West Wind wind-farm proposal near Wellington which is still awaiting an appeal decision from the Environment Court, the 630MW Project Hayes proposal in Central Otago, and the 210-250 MW tunnel-based hydro concept for the north bank of the lower Waitaki for which water consents have been lodged.

ENDS

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