Vector Limited (NS) Analysis

Overview

Vector is a leading New Zealand infrastructure group. They own and manage a unique portfolio of energy and fibre optic infrastructure networks in New Zealand.

Vectors assets reportedly perform a key role in delivering energy and communication services to more than one million homes and businesses across New Zealand. They are understood to be a significant provider of:

• Electricity distribution
• Gas transmission and distribution
• Electricity and gas metering installations and data management services
• Natural gas and LPG, including 60.25% ownership of bulk LPG distributor Liquigas
• Fibre optic networks in Auckland and Wellington, delivering high speed broadband services.

In addition to their energy and fibre optic businesses they own:

• A 50% share in Treescape, an arboriculture and vegetation management company
• A 22.11% share in NZ Windfarms, a power generation company.

Vector listed on the NZSX in 2005.

Vector is pleased to advise that the sale of Vector Gas Limited, which owns and operates Vector's gas transmission and non-Auckland gas distribution businesses, to First State Funds, was completed on 20 April 2016.ng certain rights given to the Auckland Energy Consumer Trust. For more information about this, please see VCT's annual report.

Performance

The following information was extracted from Vector Limited's full year results, released on 27 August 2024:

• Adjusted EBITDA(1) for continuing operations $365.2 million
• Total capital expenditure $510.1 million, including $195.2 million funded by the capital contributions customers pay for new connections on the network
• Group net profit after tax for continuing operations $79.9 million, inclusive of a $60 million impairment of the gas distribution business which was announced at the half year
• Final dividend 13 cents per share, plus a special dividend of 1.75 cents.(2)
• Investment in Bluecurrent (formerly Vector Metering) has performed in line with expectations
• Progress on carbon emissions reduction plan, climate change resilience, smart meter data programme, renewed partnerships with Amazon Web Services (AWS) and X (Google X), as part of our Symphony strategy

Vector Group (NZX: VCT) today announces a strong full year result underlined by solid business performance, and progress against a number of strategic initiatives.

Vector Group Chief Executive Simon Mackenzie said, “The year’s financial result sees adjusted earnings for the group before interest, tax depreciation and amortisation (adjusted EBITDA1), for continuing operations, up 14% to $365.2 million, with the group net profit after tax at $79.9 million. This recognises the $60.0 million impairment on our gas network announced at half year. Underlying profit (excluding impairment) was $139.9 million.

“Total capital expenditure for continuing operations was $510.1 million. Of this, $195.2 million was funded by the capital contributions customers pay for new connections on the network.