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>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

<ul><li>North Island generators to deliver the growth: We anticipate most generator/retailers will lift 1H23 EBITDAF earnings</li><li>Outlook commentary should be positive from GNE and MCY, less so from CEN</li><li>Key themes likely to be development pipelines, inflation, and NZAS</li></ul>

North Island generators to deliver the growth: We anticipate most generator/retailers will lift 1H23 EBITDAF earningsOutlook commentary should be positive from GNE and MCY, less so from CENKey themes likely to be development pipelines, inflation, and NZAS

Electricity Sector: NI Hydro Powers 1H23 Sector Earnings

Equity Bottom-Up

<ul><li>2Q23 rounds out a strong 1H23, but no guidance upgrade this time</li><li>Forecast changes minor, reflect short-term outlook with higher opex and wholesale prices offsetting each other</li><li>Record half year earnings</li></ul>

2Q23 rounds out a strong 1H23, but no guidance upgrade this timeForecast changes minor, reflect short-term outlook with higher opex and wholesale prices offsetting each otherRecord half year earnings

Mercury: Deluge Delivers 1H23 Earnings, Not Upgrade

<ul><li>December rounded out 2022 with another month of high renewable electricity generation (96%) and low wholesale electricity prices (Otahuhu [OTA] prices averaged just NZ$19/MWh) with North Island hydro generator’s Mercury (MCY) and Genesis Energy (GNE) having the best of the conditions</li><li>Looking ahead to 2023, we expect many of the themes that dominated 2022 to continue, with a key focus on new developments</li><li>We see share price risks to the downside, with the electricity sector’s defensive characteristics less beneficial during a market recovery</li></ul>

December rounded out 2022 with another month of high renewable electricity generation (96%) and low wholesale electricity prices (Otahuhu [OTA] prices averaged just NZ$19/MWh) with North Island hydro generator’s Mercury (MCY) and Genesis Energy (GNE) having the best of the conditionsLooking ahead to 2023, we expect many of the themes that dominated 2022 to continue, with a key focus on new developmentsWe see share price risks to the downside, with the electricity sector’s defensive characteristics less beneficial during a market recovery

Power Points: Looking Ahead to 2023 — January 2023

<ul><li>Unit 5 maintenance and hydro combine to push renewable generation to fresh highs</li><li>Valuations ease, but sector remains over-valued</li><li>Wind turbine demand softens in the face of rising prices, leaving window of opportunity for NZ developers</li></ul>

Unit 5 maintenance and hydro combine to push renewable generation to fresh highsValuations ease, but sector remains over-valuedWind turbine demand softens in the face of rising prices, leaving window of opportunity for NZ developers

Power Points: Record Renewables — December 2022

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: 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

Electricity Sector: NI Hydro Powers 1H23 Sector Earnings

1H23 is all about record North Island hydro generation, powering both Genesis Energy (GNE) and Mercury (MCY) to record half year results; Combined,...

Forsyth Barr

Mercury: Deluge Delivers 1H23 Earnings, Not Upgrade

Mercury (MCY) had a strong 1H23, with 2Q23 operating statistics highlighting strong hydro generation, the effects of the Trustpower retail...

Forsyth Barr

Power Points: Looking Ahead to 2023 — January 2023

December rounded out 2022 with another month of high renewable electricity generation (96%) and low wholesale electricity prices (Otahuhu [OTA]...

Forsyth Barr

Power Points: Record Renewables — December 2022

The story of November 2022 was the record high 97% of electricity generation coming from renewable sources, well north of the previous record of...

Forsyth Barr

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