Business

Trustpower cuts earning expectations

The Tauranga-based power company Trustpower has cut its earnings expectations by as much as 14 percent because of lower power prices and pressure on margins.

It was expecting underlying earnings for the 2020 financial year to be between $185 million and $195m, from an earlier guidance of $200m to $215m.

In a market update, the company said wholesale power prices had dropped since November, and looked to stay that way for the rest of the financial year.

The amount of power generated was also expected to be below average for the rest of the year, due to low inflows in North Island water catchments.

Volatile wholesale gas prices and increased carbon costs had reduced its expected earnings on gas margins.

It said the developments were outside of its control, but were not expected to affect its long-term profitability.

However it said lower prices have given it an opportunity to bring forward maintenance of its generation plants, including the Waipori hydro power scheme.

This article was originally published on RNZ and re-published with permission.

Help us create a sustainable future for independent local journalism

As New Zealand moves from crisis to recovery mode the need to support local industry has been brought into sharp relief.

As our journalists work to ask the hard questions about our recovery, we also look to you, our readers for support. Reader donations are critical to what we do. If you can help us, please click the button to ensure we can continue to provide quality independent journalism you can trust.

Comments

Newsroom does not allow comments directly on this website. We invite all readers who wish to discuss a story or leave a comment to visit us on Twitter or Facebook. We also welcome your news tips and feedback via email: contact@newsroom.co.nz. Thank you.

With thanks to our partners