Northpower Annual Result

Date: Friday 1st August 2008

Northpower Annual Result

Northpower’s Annual Report for the Year Ending 31 March 2008 will be distributed to consumers next week.

This year Northpower achieved a very satisfying result under extremely demanding circumstances. The company is well positioned going forward with several initiatives in place that add essential diversity to Northpower’s business and revenue sources.

Some of the challenges, such as establishing our first offshore contracting business in Western Australia, building a broadband communications network in Northland and major additions to our Wairua Hydro Power Scheme, are projects we have had planned for several years.

Other challenges included: the worst Northland storm in at least 19 years, a massive drop in the Auckland subdivision reticulation market combined with decreases in electricity network construction work by some major network business clients, extraordinary cost increases for fuel and power line construction materials and “raids” on skilled power line construction people by offshore companies. These are all challenges we expect to face at some time, and the fact that they all came at once gave us a chance to truly prove our resourcefulness and resilience.

The Net Profit After Tax (NPAT) was $11.87M for the group with the New Zealand operations recording NPAT of $14.1M, slightly below last year’s record result ($14.7M).

These results reflect the resources being put into developing new areas of business and a very difficult contracting market for much of our New Zealand operations. $1.5M of additional costs were also incurred due to the very severe July 2007 storm in Northland.

Overall, revenue has grown by 8.8% to $162.8M. Revenue comprises:
 Electricity network $45.1M;
 New Zealand contracting activities $110.1M;
 Australian contracting activities $7.6M.

Significant capital investments continued in 2007, with $34.6M invested for the year. $21.1M was invested in the Northland electricity network, including $5.7M in electricity generation.

Northpower paid out $5M as a line charge holiday to electricity consumers in February 2008 and a $4.1 million dividend is to be paid to the Northpower Electric Power Trust.

ENDS

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