Meridian Energy Limited · NZX:MEL
Meridian Energy — H1 FY2025 Earnings Presentation
46 slides from Meridian Energy's earnings presentation, Feb 26, 2025
Slide 1: Interim Results Presentation
MERIDIAN ENERGY LIMITED 26 February 2025 2025 Interim Results Presentation
Slide 2: Neal Barclay – Chief Executive
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 2 Neal Barclay – Chief Executive Meridian’s West Wind Farm near Wellington
Slide 3: Key points
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 3 Key points 1 1Earnings before interest, tax, depreciation, amortisation, unrealised changes in fair value of hedges and asset related adjustments.
Slide 4: Changing fuel mix
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 4 Changing fuel mix $10B of new generation investment in the last 15 years by generators. Wholesale market generation mix TWh 60 BESS + Demand Response Through a period of flat electricity demand and Thermal uncertainty on the future
Slide 5: A world class electricity system in NZ
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 5 A world class electricity system in NZ EU1 UK Japan USA Aus3 NZ LNG importing markets – tend to have higher prices 792 777 NZ able to deliver energy consistently and affordably, 650 even through dry years due to Affordability 589 5
Slide 6: Fuel scarcity
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 6 Fuel scarcity Waitaki daily inflow differences to average (cumulative) GWh Meridian experienced 1 in 90 year, record low May to mid- 400 August inflows. 200 That was preceded by calm and dry conditions, and meant 0 cumulative inflo
Slide 7: Contingent storage
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 7 Contingent storage Contingent storage Lake Tekapo Lake Pūkaki Lake Hawea Contingent storage is fuel that physically exists in the system today. It is intended to be available for generation at specific times to mitigate high risk o
Slide 8: Regulatory focus – 2024 fuel scarcity
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 8 Regulatory focus – 2024 fuel scarcity Government focus Action to bolster energy security Next steps on Electrifying NZ Government’s focus is on initiatives many of which are already underway or part of existing policy programme. Re
Slide 9: Transmission and distribution costs
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 9 Transmission and distribution costs Final Commerce Commission decision in November 2024 on regulated revenues for Transpower and distribution companies for the next 5 years. Regulated revenue increases are significant, more than 40
Slide 10: Transformer replacement
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 10 Transformer replacement New transformer from existing supplier installed at Manapōuri. Unit 6 returned to service in December 2024, with the first of seven new control and protection systems as part of the station’s Automation Upg
Slide 11: Construction and development
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 11 Construction and development First grid injection at Ruakākā Battery Energy Storage System, April 2025 operational date. Ruakākā Solar consent finalised, final investment decision (FID) expected in March 2025. Environment Court co
Slide 12: 2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 12
Slide 13: Mike Roan – Chief Financial Officer
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 13 Mike Roan – Chief Financial Officer Benmore Hydro Station in the Waitaki Valley, South Canterbury
Slide 14: Wholesale market operation
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 14 Dividends declared Electricity, gas and coal proxy pricing Wholesale market operation CPS Interim dividend Final dividend To updateTotal $/GJ $/MWH 25 Spot gas Wholesale electricity markets are inherently 40 Indo coal at Huntly 21
Slide 15: Operating cash flow and EBITDAF
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 15 Operating cash flows Operating cash flow and EBITDAF $Ms Interim Final half-year Total 700 667 600 509 500 461 431 364 400 244 236 300 244 200 265 303 100 187 225 0 50 2021 2022 2023 2024 2025 Financial Year ended 30 June EBITDAF
Slide 16: Dividend
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 16 Dividends declared Meridian’s new ordinary dividend policy Dividend CPS Meridian’s ordinary dividend Interim dividend policy is to make Finaldistributions dividend at a dividend Total payout Interim ordinary dividend declared of 6
Slide 17: Movement in EBITDAF
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 17 Movement in EBITDAF Movement in EBITDAF $M 1H FY25 EBITDAF -42% (-$186M) decrease on 1H 500 FY24. 400 5% higher retail contracted sales revenue on 1% -185 lower volumes. 300 +10 0 -11% decrease in 1H FY25 hydro generation -1 -1 -9
Slide 18: Energy margin
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 18 Energy margin Energy margin movement $M physical +$42M financial -$228M 5% revenue growth in mass market and corporate and 900 industrial segments from higher average prices. +18 +157 -167 +29 +21 +13 Winter fuel scarcity drove an
Slide 19: Retail customers
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 19 Retail customers Mass market +$21M (+5%) growth in mass market revenue from higher average sales price and large business volume growth. Modest declines in other mass market segment sale volumes. Corporate -4% decrease in corporat
Slide 20: Generation
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 20 Meridian average generation price Generation $/MWH 200 1H FY25 inflows were 126% of average, heavily skewed 150 to spring and early summer inflows. 100 Winter fuel scarcity drove an -11% decrease in 1H 158 127 FY25 hydro generatio
Slide 21: Operating expenses
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 21 Operating expenses Operating expenses $M Interim Final half-year Total 304 400 ↑ Operating expenses $9M (6%) higher than 1H FY24. 300 281 298 249 156 Growth in 1H FY25 from workforce changes, 208 218 142 ↑ 200 150 remuneration inc
Slide 22: Capital expenditure
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 22 Capital expenditure Capital expenditure $M Interim Final half-year Total 400 349 346 250 Capital expenditure of $104M in FY25. ↑ 300 220 175 186 $32M stay in business spend and $72M growth 175 146 200 investment. ↑ 86 83 116 100 S
Slide 23: Below EBITDAF
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 23 Net profit after tax Below EBITDAF $M Interim Final half-year Total -$154M decrease in NPBT1 from the net change in fair 500 415 451 429 value of hedges2 (-$2M decrease in 1H FY24). 400 300 188 306 238 +$61M (+37%) increase in dep
Slide 24: Debt and funding
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 24 Debt maturity profile as at 30 at 31 June December 2024 2024 Debt and funding $M Drawn debt maturing (face value) Available facilities maturing 600 800 Drawn debt maturing (face value) Available facilities maturing December 2024 t
Slide 25: Final thoughts
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 25 Final thoughts 1H FY25 was challenging with record dry winter conditions. Followed by record low inflows in the last two months. Additional hedge and DR costs of $25M+ now expected in Q3. 680MW of development projects now consente
Slide 26: Questions
MERIDIAN ENERGY LIMITED 26 February 2025 Questions
Slide 27: Additional information
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 27 Additional information
Slide 28: Segment results
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 28 Segment results
Slide 29: EBITDAF reconciliation to the income statement
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 29 EBITDAF reconciliation to the income statement
Slide 30: Retail
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 30 Customer connections Retail ICP (000) Meridian North Island Meridian South Island Powershop Total 500 Customers 400 347 365 363 370 383 129 +4% increase in customers since June 2024. 300 106 117 117 120 200 122 126 125 127 129 100
Slide 31: Hydrology
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 31 Meridian's combined catchment inflows Hydrology GWH GWh Dec YTD90 year average 92 year average 8,000 15,000 Inflows 6,000 10,000 1H FY25 inflows were 126% of historical average. 4,000 January 2025 inflows were 43% of average. 5,00
Slide 32: Generation
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 32 Generation volumes Generation GWH Hydro Wind Total 9,000 7,214 Volume 6,676 7,111 709 640 6,947 6,587 765 720 6,000 1,026 1H FY25 generation was -5% lower than 1H FY24 with -11% lower hydro generation and +42% higher 6,402 6,574 6
Slide 33: 1H FY25 EBITDAF
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 33 1H FY25 EBITDAF Movement in EBITDAF $M Energy margin -$185M 700 600 +157 500 -300 +34 -5 400 300 -66 +1 +10 0 443 -6 -1 -1 -9 200 257 100 0 EBITDAF Retail contracted Wholesale Generation spot Cost to supply Net cost of Virtual ass
Slide 34: EBITDAF to NPAT
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 34 EBITDAF to NPAT *Net changes in the fair value of unrealised energy hedges and treasury hedges
Slide 35: Energy margin
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 35 Energy margin Energy margin $M 2,100 1,750 +1,042 1,400 -1,212 1,050 +291 -89 700 +271 -264 350 -17 -9 -4 +433 -439 +441 444 0 Mass market sales C&I sales Financial contract Generation spot Cost to supply Demand response Cost to s
Slide 36: Energy margin
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 36 Energy margin Energy margin movement $M 800 +157 -167 +21 +13 -5 600 -89 -44 -84 +52 -34 +1 400 -6 629 200 444 0 Energy Margin Mass market C&I sales Financial Generation spot Cost to supply Demand Cost to supply Hedging fixed Hedg
Slide 37: Energy margin
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 37 Energy margin
Slide 38: Energy margin
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 38 Energy margin Defined as: Revenues received from sales to customers net of A non-GAAP financial measure representing energy distribution costs (fees to distribution network companies sales revenue less energy related expenses and
Slide 39: NZAS Demand Response Agreement
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 39 NZAS Demand Response Agreement Summary of demand response options Equivalent Usual Exercisable Reduction Usual Ramp-Down Usual Ramp-Up Usual Ramp-Up reduced Ramp- DR Period from Meridian demand Period Notice Period Period Option c
Slide 40: Fair value movements
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 40 Net change in fair value of hedges Fair value movements $Ms 600 Meridian uses derivative instruments to manage interest rate, foreign exchange and electricity price 400 risk. 200 402 236 249 As forward prices and rates on these in
Slide 41: Segment earnings statement
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 41 Segment earnings statement
Slide 42: Underlying NPAT reconciliation
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 42 Underlying NPAT reconciliation
Slide 43: Cash flow statement
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 43 Cash flow statement
Slide 44: Balance sheet
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 44 Balance sheet
Slide 45: Glossary
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 45 Glossary Hedging volumes buy-side electricity derivatives excluding the buy-side of virtual asset swaps Average generation price the volume weighted average price received for Meridian’s physical generation Average retail contract
Slide 46: Disclaimer
2025 INTERIM RESULTS PRESENTATION 26 February 2025 MERIDIAN ENERGY 46 Disclaimer The information in this presentation was prepared by Meridian Energy with companies and they should not be considered in isolation from, or construed due care and attention. However, the information is supplied in summa