29 Jul 2004
The Directors are pleased to announce an unaudited after tax surplus for the three months to 30 June 2004 of $15.7 million, compared with $17.2 million for the same period last year. Increases in interest costs of $2.1 million due to higher debt levels and depreciation of $1.4 million largely due to a higher asset base following the recent revaluation of generation assets contributed to the lower surplus. This quarter's results were ahead of budget expectation.
Earnings before Interest, Tax, Deprecation and Amortisation ("EBITDA") were $39.8 million versus $37.6 million for the same period last year.
The first quarter trading environment was very different to the first quarter last year, in particular, lake storage levels and inflows have been above average and spot electricity prices accordingly have been significantly lower compared with the prior year when spot prices were high due to lower hydro storage levels. (Load weighted average price for the quarter was $43 per MWh versus $140 per MWh in the first quarter 2003.)
TrustPower's own generation assets produced 480 GWh during the first quarter versus 430 GWh in the first quarter of 2003.
All of TrustPower's hydro generation storage catchments remain at historically high levels leaving the Company well positioned to meet customer demand over the remainder of the 2005 financial year.
Customer numbers have risen slightly to 226,000 as at end of June 2004 from the level advised for the 2004 financial year end result of 224,000.
The Company's balance sheet remains strong with relatively minor movement from the 2004 financial year end position. Debt to debt plus equity was 31.2 per cent as at 30 June 2004 compared with 44.5 per cent at the same time last year. Again, the revaluation of generation assets, announced with the 2004 year end result, is the main driver of this reduction in gearing.
At this early stage of the financial year it is difficult to predict year end results, however, the first quarter result is pleasing and reflects TrustPower's ability to manage wholesale market risks in both high and low price periods. At this stage the Directors are confident that another good result for the full year is achievable.
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