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Investment In New Zealand

The electricity market in New Zealand is regulated by the Electricity Industry Participation code administered by the Electricity Authority (NZ). It was recognized in November 2010 to replace the Electricity Commission (NZ). Here I am sharing about the Company Contact Energy Limited which is one of the top New Zealand stocks with dividends. Let's have a look.

Contact Energy Limited

About Company

Contact Energy Limited is a New Zealand-based diversified and integrated energy company. It focuses on the generation and retailing of electricity. It provides electricity, natural gas and LP to about 568,000 customers nationwide. Its electricity business is a generator and retailer of electricity throughout New Zealand. The company is one of the country's largest gas and electricity retailers and has around 46 per cent of the LPG market in New Zealand. The company is also one of the country's largest listed companies and one of New Zealand's most widely held stocks with around 75,000 shareholders.

It employs around 1,100 people throughout New Zealand, for making Contact an integral part of the national economy, its diverse society and local communities. Contact Energy's Power stations consist of three gas turbines facilities in Auckland, Hamilton and taranaki; four geothermal stations north of Taupo; two hydroelectric dams on the Clutha River; a gas fired peaker in Taranaki and a diesel fired peaker in Hawkes Bay.

The company has been in operation since 1996 when it acquired a portfolio of electricity generation and gas assets from the state owned electricity generator, ECNZ. It was listed on the New Zealand Stock Exchange in May 1999. It October 2004, Origin Energy became Contact's majority shareholder.

History

Contact was incorporated on 8 November 1995 and became a state owned enterprise on 18 November 1995. It commenced operations on 1 February 1996 and acquiring assets from ECNZ with a payment of $1.6 billion. In the year of 1999 the company was sold with 40% purchased by Edison Mission Energy as cornerstone shareholder for $5 per share. The remaining 60% was sold in a public offering of shares for $3.10 per share.

During the financial crisis in 2008 the company decided to increase prices by up to 12% while doubling its directors' fees. The result was it lost more than 40,000 customers in six months-10% of the total. Its profit was halved.

Announcements

On 14 June 2013 the Contact energy decided to raise $240 million in long-term debt through a private placement with U.S investors to refinance maturing debts. The proceeds of the debt, with an average tenor of 11 years, will be drawn down in September and December.

In December 2011, the company completed the acquisition of the 15 megawatts of Whirinaki diesel-fired peaker plant. As of June 30,, 2012 Origin Energy Pacific Holdings Limited held 52.2% interest in Contact Energy Limited. In October 2012, it sold its gas metering business to Vector. In July 2013, the company confirmed the conclusion of the sale process for the site of the former New Plymouth power station. In this same month it also announced that it has completed the sale of its gas metering business to Vector group company, Advanced Metering Assets (AMA).

Dividend History

The company has a current market capitalization of 3.85 Billion, EPS is 0.29, P/E ratio is 17.87 and the dividend yield is 4.38% at the annual dividend payout of 0.11.