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.

Thematic (Sector/Industry)

<ul><li>Wholesale prices hold up despite strong hydro storage position and falling thermal generation costs</li><li>Generation development pipeline lifts again with MCY joining the early stage announcement game</li><li>Project Onslow rumbles on and carbon market working out what happens next</li></ul>

Wholesale prices hold up despite strong hydro storage position and falling thermal generation costsGeneration development pipeline lifts again with MCY joining the early stage announcement gameProject Onslow rumbles on and carbon market working out what happens next

Power Points: Carbon Uncertainty — April 2023

Equity Bottom-Up

<ul><li>MCY the latest generator to showcase its mega generation pipeline</li><li>Geothermal expansion looks compelling if consents come through</li><li>Short term targets unchanged: MCY confirmed it short-term objectives remain on track</li></ul>

MCY the latest generator to showcase its mega generation pipelineGeothermal expansion looks compelling if consents come throughShort term targets unchanged: MCY confirmed it short-term objectives remain on track

Mercury: Fresh Wind — 2023 Investor Day

<ul><li>Development pipeline goes to the next level: the headline sector generation development pipeline increased +8.2TWh (+38%) in February 2023, mainly due to MEL revealing a big increase in early stage options</li><li>1H23 results deliver strong earnings growth as expected, dividend growth more muted</li><li>Operating conditions continue to favour North Island hydro generators: February 2023 North Island hydro generation was +47% above average, a continuation of recent trends</li></ul>

Development pipeline goes to the next level: the headline sector generation development pipeline increased +8.2TWh (+38%) in February 2023, mainly due to MEL revealing a big increase in early stage options1H23 results deliver strong earnings growth as expected, dividend growth more mutedOperating conditions continue to favour North Island hydro generators: February 2023 North Island hydro generation was +47% above average, a continuation of recent trends

Power Points: Developing Overbuild Risk — March 2023

<ul><li>Hydro powers a strong 1H23 result: MCY reported a strong 1H23 result as expected, though plenty of moving pieces and accounting changes made read-through difficult</li><li>Cost pressures and capital needs rising</li><li>Kaiwera Downs 1 well underway, Kaiwaikawe the next cab off the rank followed by Kaiwera Downs II</li></ul>

Hydro powers a strong 1H23 result: MCY reported a strong 1H23 result as expected, though plenty of moving pieces and accounting changes made read-through difficultCost pressures and capital needs risingKaiwera Downs 1 well underway, Kaiwaikawe the next cab off the rank followed by Kaiwera Downs II

Mercury: Excess Water Whets Earnings — 1H23 Result

<ul><li>Following relative share price weakness over the past two months in Contact Energy (CEN) and share price strength in Meridian Energy (MEL) we upgrade CEN to NEUTRAL (from UNDERPERFORM) and downgrade MEL to UNDERPERFORM (from NEUTRAL)</li><li>ASX futures appear mispriced given movements in underlying drivers</li><li>Tale of two islands as weather gods bless MCY and GNE, hang CEN out to dry</li></ul>

Following relative share price weakness over the past two months in Contact Energy (CEN) and share price strength in Meridian Energy (MEL) we upgrade CEN to NEUTRAL (from UNDERPERFORM) and downgrade MEL to UNDERPERFORM (from NEUTRAL)ASX futures appear mispriced given movements in underlying driversTale of two islands as weather gods bless MCY and GNE, hang CEN out to dry

Power Points: Future Expectations Too High — February 2023

New Zealand

Mercury NZ Ltd provides utility services. The Company generates and supplies electricity from hydro, geothermal, gas-fired, and wind power stations, as well as owns and manages bio-energy power plants. Mighty River Power serves customers throughout New Zealand.

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Mercury NZ Ltd (MCY NZ)

Power Points: Carbon Uncertainty — April 2023

March 2023 was dominated by the Government pressing ahead with Project Onslow (despite costs almost quadrupling) and the failure of the carbon...

Forsyth Barr

Mercury: Fresh Wind — 2023 Investor Day

The key feature of Mercury's 2023 Investor Day (its first since 2019) was the more than doubling of its development pipeline to ~8.1TWh from...

Forsyth Barr

Power Points: Developing Overbuild Risk — March 2023

February 2023 was again characterised by high North Island hydro generation, which is good news for Genesis Energy (GNE) and Mercury (MCY), but the...

Forsyth Barr

Mercury: Excess Water Whets Earnings — 1H23 Result

Mercury's (MCY) well anticipated strong 1H23 result came packaged with its second hydro generation guidance upgrade in as many months, though lower...

Forsyth Barr

Power Points: Future Expectations Too High — February 2023

Following relative share price weakness over the past two months in Contact Energy (CEN) and share price strength in Meridian Energy (MEL) we...

Forsyth Barr

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