Contact Energy has posted a 62% jump in annual profit to $423 million, with operating earnings topping $1 billion for the first time after absorbing rival Manawa Energy.
The power company reported its full-year results on Monday, showing EBITDAF of $1.011 billion for the year ended June 30, up 31% from $774m the previous year. Net profit rose from $261m.
The surge followed Contact's acquisition of Manawa Energy, completed in July 2025, which added 2.4 terawatt hours of renewable generation. Total output for the year had been 98% renewable.
Contact Energy chief executive Mike Fuge said the 2026 financial year had been "transformational" for the company.
"The strong performance of the combined entity has set us up well as we move forward to execute the Contact31+ strategy," Fuge said.
Operating free cash flow climbed 49% to $648m, driven by the acquisition, improved performance and a positive shift in working capital. Contact raised $575m of new equity in February to reduce debt and fund future renewable projects.
Average wholesale electricity prices fell 11% to $140 per megawatt hour as hydro inflows ran at 118 per cent of average, a sharp contrast to the tighter conditions of the previous year, it said. Contact spent less on gas purchases as fuel availability improved, compared with tighter conditions in 2025.
Renewable build and energy security
Contact brought its first 100-megawatt grid-scale battery online at Glenbrook, near Auckland, in March and started construction on a second 200-megawatt unit at the same site, expected to be operational by early 2028.
The company signed a 10-year agreement with Genesis Energy in August 2025 for 50 megawatts of firming capacity at Huntly, aimed at keeping the Rankine coal-and-gas units available during dry years.
Contact also entered a seven-year gas supply deal with the Ministry of Business, Innovation and Employment to provide gas to about 100 schools, hospitals and public entities, backed by a supply agreement with Greymouth Gas.
Fuge said securing gas for the medium term would "support security of supply for essential institutions like schools and hospitals, as well as Kiwi businesses and homes".
On the generation side, consent had been granted in April for a proposed Southland Wind Farm expected to produce more than 1.2 terawatt hours a year.
Construction of the Te Mihi Stage 2 geothermal plant continued, with the plant scheduled to come online in the third quarter of 2027. Commissioning had begun on the Kōwhai Park solar farm, and a second solar project at Glorit reached financial close in June.
Data centre eyed for Taranaki
Contact separately announced on Monday it was working with CDC Data Centres to explore building a 250-megawatt data centre at Stratford in Taranaki.
The companies plan to seek resource consent for the facility. It would be backed by co-located battery storage and powered under long-term contract by new renewable generation.
"We believe Stratford shapes as an ideal location to explore a digital hub powered by renewable energy from where the local Taranaki economy can thrive," Fuge said.
The site already has 500 megawatts of grid-scale batteries consented and a grid connection in place. Contact's joint venture with Lightsource bp is also looking at a 150-megawatt solar farm with integrated battery storage nearby.
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