GNE, CEN, MEL, VCT: 4 NZX utilities in news amid rising power prices

Highlights

• An average NZ household is paying nearly 5% more for electricity in 2022 than a year before.
• Contact Energy and Meridian released their monthly operating reports for May.
• Manawa Energy expects EBITDAF between $140 million and $160 million in FY23.

As per a report by the Ministry of Business, Innovation and Employment (MBIE), an average NZ household is paying nearly 5% more for electricity in 2022 than a year before.

Increasing prices of coal, gas and carbon credits increased the cost of producing thermal electricity. NZ gets its power majorly from hydro, geothermal and wind energy power stations.

Few Kiwis have been paying double the fixed daily power charges from 1 April for users who weren’t temporarily protected by being on a fixed-rate plan.

Here is a look at how these 4 NZX utilities are performing.

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Contact Energy Limited (NZX:CEN, ASX:CEN)

Energy retailer and distributor Contact Energy provided its operating report for May on 9 June.

Contact’s customer business reported electricity and gas sales of 384GWh (up from 372GWh) and mass market netback of $108/MWh (up from $103.779/MWh) for May 2022 compared to the same month in 2021.

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The Group’s wholesale business reported contracted wholesale electricity sales of 694GWh and Electricity and steam net revenue of $111.35/MWh in the month.

Contact ended the day flat to close at $7.1.

Meridian Energy Limited (NZX:MEL, ASX:MEZ)

Meridian, an electricity producer via renewable energy sources, released its monthly operating report for May on 14 June.

May was the third warmest month of all Mays on record.

Do Read: GNE, MEL: 2 green stocks to eye as NZ aims for 100% renewable electricity

The Group’s total inflows stood at 81% of the historical average for May 2022 and water storage in MEL’s Waiau catchment stayed below average at May end. Meridian’s retail sales volumes were 4.4% higher in the month compared to the same month in 2021.

Meridian ended the day 0.44% in the red to close at $4.48.

Manawa Energy (NZX: MNW)

Engaged in electricity generation via hydropower stations and wind farms, Manawa Energy witnessed a strong FY22, posting a 290% increase in NPAT to $119.8 million and a 2% rise in operating earnings to $204.2 million.

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The Group completed the sale of its mass market retail business to Mercury Energy to transition to Manawa Energy. The company’s generation production volumes rose 3% and it announced a final dividend of 16cps and a one-off special dividend of 35cps.

MNW expects EBITDAF between $140 million and $160 million in FY23.

Manawa ended the day flat to close at $6.05.

Vector Limited (NZX:VCT)

Electricity and gas distributor Vector increased its total electricity connection numbers by 1.5% on pcp in the year to 31 March 2022 and electricity distributed volumes rose 0.7% on pcp in the 9 months to 31 March 2022.

There was a 1.4% rise in total gas connections in the year to 31 March. However, new electricity and gas connections fell 14.2% and 14.9% on pcp, respectively, in the 9-month period.

Vector ended the day 0.47% in the red to close at $4.28.

Bottom Line

High power prices come as NZ Energy Minister Megan Woods plans to eliminate the obligation for power companies to offer low-user tariffs over 5 years from April.

(NOTE: Currency is reported in NZ Dollar unless stated otherwise)