Contact Energy Limited has reported a striking 43.9% increase in net profit for the half-year ending December 2025, even as revenue fell by 5.3%. The company’s acquisition of Manawa Energy Limited has boosted its net tangible assets, underpinning a healthy interim dividend.
- Net profit from continuing operations up 43.9% to NZD 204.957 million
- Revenue declined 5.3% to NZD 1.617 billion
- Net tangible assets per security rose to NZD 3.66 from NZD 2.68
- Interim dividend declared at NZD 0.16 per share
- Acquisition of Manawa Energy Limited credited for asset growth
Strong Profit Growth Amid Revenue Pressure
Contact Energy Limited has unveiled its half-year financial results for the six months ending 31 December 2025, revealing a notable divergence between revenue and profitability. While the company’s revenue from continuing operations slipped by 5.3% to NZD 1.617 billion, net profit from those operations surged by 43.9% to NZD 204.957 million. This robust profit growth amid a revenue decline is a compelling story of operational efficiency or margin improvement.
Impact of Strategic Acquisition
A key driver behind the improved financial position appears to be Contact Energy’s acquisition of Manawa Energy Limited. This strategic move has significantly increased the company’s net tangible assets per quoted equity security, which rose from NZD 2.68 to NZD 3.66. The acquisition not only bolsters Contact Energy’s asset base but may also provide new revenue streams or cost synergies that have contributed to the profit uplift.
Shareholder Returns and Market Confidence
Reflecting confidence in its financial health, Contact Energy declared an interim dividend of NZD 0.16 per share, with an imputed amount of NZD 0.035. The dividend payment is scheduled for 25 March 2026, with a record date of 19 February 2026. This payout signals management’s commitment to delivering shareholder value despite the top-line challenges.
Outlook and Next Steps
While these results are unaudited and lack detailed operational breakdowns, they set a positive tone for Contact Energy’s trajectory. Investors will be keen to see the audited financial statements and management commentary for insights into cost management, integration progress of Manawa Energy, and future growth prospects. The market will also watch how the company navigates the broader energy sector dynamics in New Zealand.
Bottom Line?
Contact Energy’s profit leap amid revenue softness highlights strategic resilience but invites scrutiny on sustainability.
Questions in the middle?
- What operational changes drove the significant profit increase despite lower revenue?
- How will the Manawa Energy acquisition influence Contact Energy’s long-term growth?
- What risks could affect dividend sustainability given the revenue decline?