Contact Energy beat expectations as it lifted annual profit 27 percent with low rainfall in hydro catchments meaning Contact ran its gas-fired generation units harder to meet national demand.
Net profit rose to $190.4 million in the year ended June 30 from $150.9m a year earlier, the country's biggest listed electricity generator and retailer said.
Earnings before interest, tax, depreciation, amortisation and unrealised fair value movements climbed 15 percent to $508.7m, with a 21 percent jump in sales to $2.7 billion.
"Our results show substantial improvement in our underlying business performance as we have utilised our flexible fuel and generation profile and responded decisively to increased activity in the retail sector," chief executive Dennis Barnes said.
"The second half of FY12 was characterised by low hydrology and our thermal assets, including the Stratford peaker plant, were drawn on as lower hydro generation was replaced with thermal generation."
The board declared a final dividend of 12 cents per share, taking the total distribution to 23 cents per share, unchanged from 2011.
The company didn't give any guidance for the 2013 financial year.
Mr Barnes said Contact faced significant decisions in the next 18 months about how much gas it contracts in the future, and its impact on how it runs its baseload combined-cycle gas-fired power stations at Otahuhu and Stratford.
"The current high level of upstream exploration and development activity gives me confidence that Contact will markedly improve its contracted position," he said.
Contact expects to complete its 166 megawatt Te Mihi geothermal power station next year.
NZN