Vector (VCT) H1 2025 earnings summary

Executive summary

• Net profit after tax for continuing operations rose to $118 million for H1 FY25, up 50% year-over-year, reflecting strong performance and the impact of prior-year impairments and asset sales.

• Adjusted EBITDA for continuing operations increased 16% year-over-year to $202 million.

• Revenue from continuing operations grew 11% year-over-year, driven by electricity price adjustments and higher capital contributions.

• The CEO will step down at the end of June after a long tenure and significant industry contributions.

• Sale of gas trading, LPG, Ongas, and Liquigas businesses completed, with discontinued operations excluded from core results.

Financial highlights

• Adjusted EBITDA rose by $28 million year-over-year; net profit after tax from continuing operations reached $118 million.

• Gross capital expenditure for continuing operations increased 12% to $261 million; net CapEx after capital contributions decreased 2–3% to $138 million.

• Capital contributions surged 32–33% to $123 million, mainly from new data centres, a major KiwiRail project, and system growth.

• Interim dividend of 12 cents per share declared, with a revised policy targeting 70–100% of free cash flow.

• Net cash flows from operating activities increased to $276.9 million from $188.0 million year-over-year.

Outlook and guidance

• FY25 guidance: adjusted EBITDA expected at $400–$415 million, gross CapEx at $495–$525 million, and capital contributions at $215–$245 million.

• The company is entering the final phase of the DPP-3 regulatory period, with DPP-4 starting 1 April 2025, marking a new five-year regulatory cycle.

• Regulatory consultations on connection pricing and network projects may affect customer contribution levels and connection efficiency.

• The sale of LPG and Liquigas is expected to result in a gain of approximately $4 million, to be finalised in the next annual report.