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Trustpower updates market guidance

17 Feb 2020

FY-20 EBITDAF Guidance

A number of factors have changed since Trustpower last gave market guidance in November 2019. These changes have caused Trustpower to re-evaluate its forecasted FY-20 EBITDAF. The key changes are summarised below:

• Materially lower wholesale electricity prices observed to date, with forward spot prices for the rest of the financial year significantly lower than observed in November.
• While overall generation volume is broadly in line with expectation the timing of generation, especially wind (acquired under contract) occurred more in lower priced periods than expected.
• Generation for the remainder of the year is expected to be below average due primarily to low North Island inflows but also due to retaining South Island storage in response to below average prices.
• Lower wholesale prices created an opportunity to bring forward maintenance of generation schemes, particularly the Waipori scheme.
• Volatile wholesale gas prices and increased carbon costs driving lower than expected gas margins.

Further details are provided in the attached slides.

Trustpower advises that it now expects its FY-20 EBITDAF to be in the range of $185 to $195 million.

These changes are predominantly driven by uncontrollable events such as hydrology and as such do not reflect any change in underlying business performance. This result is not expected to impact Trustpower’s long term profitability or dividend-paying ability.

Kevin Palmer Chief Financial Officer & Company Secretary

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