Meridian Energy's $429m profit four times higher than previous year

Meridian Energy's full year net profit is more than 4.5 times greater than the year earlier, reflecting operating strength prior to the onset of a drought in May.

The energy company said the net profit for the year ended June also reflected net gains on hedge instruments of $249 million compared with a net loss of $351m on hedge instruments in the year earlier.

Key numbers for the year ended June compared with a year ago:

Chief executive Neil Barclay said the strong and improved result allowed the company to invest $349m in new and existing generation assets during the year.

However, the outlook for 2025 was less positive.

He said Meridian's hydro catchments from May through to mid-August had been the lowest on record and the 2025 financial year currently looked to be far more challenging.

"Record low inflows have combined with a shortage of gas and unseasonally low wind, causing wholesale prices to lift materially," Barclay said.

"As a result, Meridian called on hedge arrangements to ensure our hydro lakes were managed within consent conditions to maintain security of supply.

"The wider sector took several steps to address the situation, including exercising demand response options, buying gas from Methanex for electricity generation and securing access to contingent hydro storage, should we need it."

He said the resulting increase in wholesale prices had affected less that 0.1% of its customers, as most were on fixed price contracts.

"Meridian has also taken steps to look after our larger commercial and industrial customers rolling off their existing contracts, by offering to extend their current pricing through to 1 November 2024."

Barclay said Meridian had a number achieved a number of milestones over the year.

"The signing of 20-year agreements with New Zealand Aluminium Smelters, the commissioning of Harapaki wind farm, construction underway on our first grid scale battery and the development of exciting new strategies across our retail and generation businesses."

He said Meridian was committed to developing enough new renewable energy to support the country's transition to a net zero economy, with at least a 30% share of the generation market.

rnz.co.nz

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