Record power profits shared with customers

Ruapehu Bulletin, Volume 14, Issue 646, 23 July 1996, Page 7

Record power profits shared with customers

King Country Energy made a record profit of $ 1 .58 million for the year to 3 1 March 1996 before special discounts to custom ers and tax payments, chairman Ken Street said last week. The company's customers were the main group to benefit, according to Mr Street. 'The special discount to most of our customers on 29 February was a major feature of the year. It clearly showed the strong ties between the company, its customers, and community," he said. "It aflowed us, in conjunction with our shareholder, the King Country Electric Power Trust, to distribute a large proportion of our income back into the community," Mr Street said. "We believe that, as a service organisation owned by the community, we should not take wealth from the community through high prices. Rather we should ensure that the community benefits from the company's efficiencies," Mr Street said a government survey shpws the average consumer in the North Island pays a third more for their electricity than King Country Energy 's customers. This means that if a King Country consumer paid $75 for a month's electricity, the average North Island consumer paid more than $100. "King Country Energy has a very high value to the community, many

times higher than its 9.2 per cent return on equity," Mr Street said After special payments and tax the company's result for the year shows a cash surplus of $650,000. 'This was because the discount was spread over several months rather than all accounted for in March," said Mr Street, He said the company had been able to achieve a record profit as a result of internal cost controls and a two per cent growth in saies. Interest income also increased as did the revenue from its contracting services. Mr Street said the growth in electricity saies was mainly a result of expansion in the food and wood processing industries during the year. Domestic saies fell slightly due mainly to the short ski season, interrupted by the September Ruapehu eruption, a reasonably warm winter and energy conservation programmes. Mr Street said the company continues to focus on providing services which are meeting the particular needs of the communities it serves. "For example we have replaced the cable to the Chateau to ensure reliability of supply for a major tourist centre and a great deal of work has been done moving overhead lines to allow forestry planting with clear space overhead." "We believe our strength is in what we can return to the community, not what we can take from it," he said.