New Zealand Professional Investment Services Firm, Forsyth Barr

Forsyth Barr

New Zealand Professional Investment Services Firm

We are proud to be a New Zealand owned firm, with 21 offices throughout the country and over 300 employees. We assist personal, institutional and corporate clients providing a full range of investment services.

Forsyth Barr is a foundation New Zealand Exchange firm (NZX) and accredited market participant. We have been confirmed by the Financial Markets Authority as a Qualifying Financial Entity (QFE).

Research is the cornerstone of our advice. We have one of New Zealand's leading teams of analysts. Our global affiliations ensure comprehensive research coverage of all major investment markets.

Equity Bottom-Up

<ul><li>We calculate that Contact Energy (CEN) finished FY23 with a record monthly EBITDAF of NZ$83m, although that was boosted by a significant one-off gain and an abnormally low LWAP/GWAP ratio.</li><li>CEN is also making an accounting change that will boost reported EBITDAF a further ~+NZ$22m to NZ$575m, however, from our perspective, we will continue to treat market making gains and losses as operating earnings.</li><li>With little change to later forecasts, we leave our target price unchanged at NZ$8.30 at retain our NEUTRAL rating.</li></ul>

We calculate that Contact Energy (CEN) finished FY23 with a record monthly EBITDAF of NZ$83m, although that was boosted by a significant one-off gain and an abnormally low LWAP/GWAP ratio.CEN is also making an accounting change that will boost reported EBITDAF a further ~+NZ$22m to NZ$575m, however, from our perspective, we will continue to treat market making gains and losses as operating earnings.With little change to later forecasts, we leave our target price unchanged at NZ$8.30 at retain our NEUTRAL rating.

Contact Energy: One-Off Gains - June 2023 Op Stats

<ul><li>New FY27 targets highlight earnings growth and development goals: CEN’s revised targets show it is generally on track to achieve the FY26 goals set out two years ago and that it can do more.</li><li>Capex growth the only negative: The only negative we took from the day was higher SIB capex (up +NZ$50m in the FY24–FY26 period) and Te Mihi upgrade costs increasing ~+10% (+NZ$75m) on our old assumption.</li><li>April 2023 operating result was strong, points to CEN meeting FY23 EBITDAF guidance</li></ul>

New FY27 targets highlight earnings growth and development goals: CEN’s revised targets show it is generally on track to achieve the FY26 goals set out two years ago and that it can do more.Capex growth the only negative: The only negative we took from the day was higher SIB capex (up +NZ$50m in the FY24–FY26 period) and Te Mihi upgrade costs increasing ~+10% (+NZ$75m) on our old assumption.April 2023 operating result was strong, points to CEN meeting FY23 EBITDAF guidance

Contact Energy: Outlook Building Nicely — 2023 Investor Day

<ul><li>Contact Energy (CEN) delivered a 1H23 result well down on 1H22, but in line with expectations</li><li>CEN also released a soft January 2023 operating result of NZ$30m, the lowest January in the past nine years, although it was impacted by trading losses</li><li>CEN is on the cusp of delivering strong earnings momentum, albeit that requires a turnaround in recent operating statistics</li></ul>

Contact Energy (CEN) delivered a 1H23 result well down on 1H22, but in line with expectationsCEN also released a soft January 2023 operating result of NZ$30m, the lowest January in the past nine years, although it was impacted by trading lossesCEN is on the cusp of delivering strong earnings momentum, albeit that requires a turnaround in recent operating statistics

Contact Energy: Turning for Home With the Wind in Its Sales

<ul><li>December 2022 another month below pcp, but some positives as well</li><li>1H23 a soft result, made to look worse vs. a record 1H22</li><li>Pulling back FY23 EBITDAF again as there is no sign yet wholesale electricity market conditions are changing in favour of CEN</li></ul>

December 2022 another month below pcp, but some positives as well1H23 a soft result, made to look worse vs. a record 1H22Pulling back FY23 EBITDAF again as there is no sign yet wholesale electricity market conditions are changing in favour of CEN

Contact Energy: Feeling Pain Whilst Awaiting Rain

<ul><li>Contact Energy's (CEN) stuttering start to FY23 continued in August 2022 with EBITDAF of NZ$39m the lowest in the past ten years</li><li>Whilst the start to FY23 has been challenging, we believe CEN is well positioned for stronger earnings in later months given hydro storage volumes and rising ASX futures prices</li><li>CEN remains our preferred electricity stock and we retain our NEUTRAL rating</li></ul>

Contact Energy's (CEN) stuttering start to FY23 continued in August 2022 with EBITDAF of NZ$39m the lowest in the past ten yearsWhilst the start to FY23 has been challenging, we believe CEN is well positioned for stronger earnings in later months given hydro storage volumes and rising ASX futures pricesCEN remains our preferred electricity stock and we retain our NEUTRAL rating

New Zealand

Contact Energy Limited is a diversified and integrated energy company which focuses on the generation of electricity and the sale of electricity and gas in New Zealand.

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Contact Energy (CEN NZ)

Contact Energy: One-Off Gains - June 2023 Op Stats

We calculate that Contact Energy (CEN) finished FY23 with a record monthly EBITDAF of NZ$83m, although that was boosted by a significant one-off...

Forsyth Barr

Contact Energy: Outlook Building Nicely — 2023 Investor Day

Contact Energy’s (CEN) 2023 investor day canvassed familiar topics and updated FY26 targets to new FY27 targets and in general, CEN is achieving...

Forsyth Barr

Contact Energy: Turning for Home With the Wind in Its Sales

Contact Energy (CEN) delivered a 1H23 result well down on 1H22, but in line with expectations; CEN also released a soft January 2023 operating...

Forsyth Barr

Contact Energy: Feeling Pain Whilst Awaiting Rain

Contact Energy's (CEN) big challenge is short-term earnings momentum, with wholesale electricity market conditions seemingly conspiring against it;...

Forsyth Barr

Contact Energy: Stuttering Start to FY23

Contact Energy's (CEN) stuttering start to FY23 continued in August 2022 with EBITDAF of NZ$39m the lowest in the past ten years

Forsyth Barr

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