CHAIRMAN’S Statement
THE BUSINESS CASE FOR AN ENERGY DEMOCRACY
It is pleasing to report that Vector’s performance continues to deliver the solid results necessary to support growing dividends for our shareholders.
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With adjusted EBITDA of $474.4 million, Vector has delivered at the top end of our market guidance of $460 million to $475 million. Shareholders will receive a fully-imputed final dividend of 8.0 cents, taking the full year dividend to 16.00 cents per share, up from 15.75 cents in 2016. The Vector board and management team are proud to have delivered 11 consecutive years of dividend growth, noting that via our majority shareholder Entrust, these proceeds are largely distributed to the people of Auckland by way of the Entrust dividend. We encourage you to read through these pages to learn more about the innovation, initiatives and attitude that Vector has employed to deliver this result. After 11 years, you might assume that such results are to be expected: Vector provides an essential service, we have robust strategies and we are in good shape. In this vein, our focus on creating a new energy future based on disruption and sustainability could be considered a “nice to have”. I strongly urge you to rethink that assumption. Vector is a business under pressure through a combination of consumer trends, a low interest rate environment and regulatory settings. The downward movements in our regulated networks’ financial results may be small, but they are noticeable: electricity connections may be up, but throughput is down; gas volumes are up, but prices are about to be reset down. Despite net investment of over $700 million into our regulated networks over the past five years, our regulated adjusted EBITDA remains $30 million below what it was four years ago.
MICHAEL STIASSNY CHAIRMAN
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