Meridian Energy Limited (NS) Analysis

Overview

As the country's main electricity generator and a significant retailer, Meridian is New Zealand's largest electricity company.

Meridian generates electricity from 100% renewable sources wind and water. The company generates approximately 30% of New Zealands electricity from its integrated chain of dams on the Waitaki River and Manapouri, which is the largest hydro power station in New Zealand, and four wind farms around the country.

Through the Meridian and Powershop brands, the company retails electricity to over 270,000 customer connections, including homes, businesses and farms around the country.

The company is committed to renewable energy and supporting the environments and communities where it operates. Meridian continues to focus on providing energy solutions that can help customers manage their energy use.

Meridian was incorporated in 1998 and began business in 1999, when Electricity Corporation of New Zealand Limited was split into three separate state enterprises: Meridian, Genesis and Mighty River. In this process, Meridian was allocated various South Island hydro assets. The company was listed on the NZX in October 2013 as part of the Governments Share Offer Programme. The Government retains 51% ownership of Meridian.

MEL has been granted Listing with a 'Non-Standard' ("NS") designation. This designation was granted because of provisions in MEL's constitution regulating the ownership and transfer of its Ordinary Shares due to the New Zealand government's shareholding. For further information, please see a copy of the waiver under Documents on Merdians' homepage on nzx.com

Performance

The following information was extracted from Meridian Energy Limited's full year results, released 27 August 2025:

Meridian navigates challenging year, lays strong foundation for growth

Meridian Energy has reported operating cash flows of $318 million for the year ending 30 June 2025, down from $667 million the previous year. The company recorded a net loss after tax of $452 million, compared to a net profit after tax of $429 million in FY24.

EBITDAF1 was $611 million, down from $905 million, while underlying net profit2 fell from $359 million to $56 million. Both of these are non-GAAP measures.

A key factor behind these results was a 23% decrease in energy margin, down from $1.276 billion to $982 million. This was impacted by two severe droughts and $300 million spent on hedge and demand response contracts to help maintain security of supply for New Zealand homes and businesses. This included calling the largest demand response option with New Zealand Aluminium Smelters