Latest / Early Edition with Ryan Bridge / Oliver Mander: Shareholders Association CEO on Contact Energy's annual profit, potential data centre

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Oliver Mander: Shareholders Association CEO on Contact Energy's annual profit, potential data centre · Early Edition with Ryan Bridge

• 0:00
  Speaker 1: The average New Zealand property residential property value down one
• 0:03
  Speaker 1: and a half percent in the three months to the
• 0:06
  Speaker 1: end of July. This is the report out yesterday from
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  Speaker 1: qv SO down one and a half percent in three months. Now,
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  Speaker 1: remember Labor needs three percent growth in housing prices per
• 0:18
  Speaker 1: year to fund the doctor's visits that they have promised
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  Speaker 1: on the campaign. So and it will be interesting to
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  Speaker 1: see depending on where you live in New Zealand, if
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  Speaker 1: your house prices are going up and then you need
• 0:31
  Speaker 1: to sell your house and it's a second house, then
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  Speaker 1: you will be paying the capital gains tax which will
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  Speaker 1: be funding the doctor's visits for I don't know. Some
• 0:39
  Speaker 1: rich list are living in Herne Bay. Three of them
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  Speaker 1: per year is what they are entitled to under Labour's policy.
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  Speaker 1: So they have some questions to answer about that, because
• 0:48
  Speaker 1: if you're dropping one and a half percent in three months,
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  Speaker 1: we will wait to see what the annual average is.
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  Speaker 1: But remember they need three percent. That is what their
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  Speaker 1: calculations are based on three percent increase per year. It
• 1:02
  Speaker 1: is fourteen after five. Right, let's go to contacts. They've
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  Speaker 1: reported a record net profit four hund and twenty three million,
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  Speaker 1: up nearly twenty eight percent operating earnings topping a billion.
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  Speaker 1: This is thanks to in part, the one energy takeover
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  Speaker 1: and stronger renewable generation.
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  Speaker 2: They are a solid return on some very prudent investments
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  Speaker 2: and our shareholders should be happy with that. But they
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  Speaker 2: are also made Remember that also came with an increase
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  Speaker 2: of our renewable generation to ninety eight percent.
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  Speaker 1: Olive Amanda is Shareholders Association. See you over me this morning, Oliver.
• 1:33
  Speaker 3: A good morning water, Bryan.
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  Speaker 1: So are you happy with that? Their full year dividend
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  Speaker 1: up three percent forty cents a share.
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  Speaker 3: Look, it is a pretty good result. The dividend has
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  Speaker 3: increased to forty cents. It's interesting that they're still holding
• 1:47
  Speaker 3: something in reserve for their dividends. They're only paying it
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  Speaker 3: out at sixty five percent of their operating free cashloads.
• 1:53
  Speaker 3: If policy gives them leads to pay out quite a
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  Speaker 3: lot more than that. That probably reflects of it. They're
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  Speaker 3: trying to correct that funding optional for those projects that
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  Speaker 3: they have going forward.
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  Speaker 1: It's interesting listening to what they're saying in regards to demand,
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  Speaker 1: like they you know, obviously you need prices to be
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  Speaker 1: you need some demand, don't you end when you have
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  Speaker 1: a whole bunch of businesses going offline who are demanding
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  Speaker 1: you need something to replace it with and they're looking
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  Speaker 1: to data centers amongst other things.
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  Speaker 3: Look, I mean, that's that's really interesting I made yesterday
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  Speaker 3: in terms of the potential option they're looking at with
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  Speaker 3: CDC in Stratford and yeah, look New Zealand and we've
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  Speaker 3: seen that in Southland as well. At the moment we
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  Speaker 3: see investment in data center in data centers in Southland
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  Speaker 3: and the generation that goes along with that. So you
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  Speaker 3: know that that is another lever for New Zealand and
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  Speaker 3: to consider in terms of its future electricity demand as well.
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  Speaker 3: And it's the way and I think I've said this
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  Speaker 3: before iron these these companies are currently growth companies, so
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  Speaker 3: investing heavily in gross contacted and no exceptions. Gross capex
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  Speaker 3: this year was three hundred and seventy five million, and
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  Speaker 3: they're talking about the increasing that next year to somewhere
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  Speaker 3: around that four sixty four to seventeen million mark.
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  Speaker 1: How investors reviewing seeing the result.
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  Speaker 3: I think investors should should probably fairly positively as a result.
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  Speaker 3: There's noise in there because you've start digesting here the
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  Speaker 3: money or acquisition and that's if you strip that out,
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  Speaker 3: you've got to sort of got that seventeen that ebit's
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  Speaker 3: forge and interest in tax figures not quite as spectaculous,
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  Speaker 3: but it's still around seventeen percent. And similarly for the profit,
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  Speaker 3: there's noise in that in terms of increase in profit,
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  Speaker 3: both for some underlying issues and from money or itself.
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  Speaker 3: Be still talking about an underlying increase of somewhere between
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  Speaker 3: somewhere that's thirty percent mark, which is which is really
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  Speaker 3: pretty good for consumers. It's interesting because there's a signal
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  Speaker 3: that in the forward market that's just that the wholesale
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  Speaker 3: prices are reducing. They won't always flow through directly to
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  Speaker 3: consumer bills because there's other factors in there like transmission
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  Speaker 3: and distribution cost, but it could be that's pointing to
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  Speaker 3: some relief and residential power price increases into the next
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  Speaker 3: year as well, which is interesting.
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  Speaker 1: Oliver Good to have on the show is always Oliver
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  Speaker 1: Amanda Shareholders Association.
• 4:12
  Speaker 3: Ceed for more from early edition with Ryan Bridge. Listen
• 4:16
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