A recent revaluation of Genesis Energy's assets lifted total value to $2.58 billion, about $320 million higher than the anticipated book value at June 30.
The revaluation increase was net of a loss of about $101 million against the acquisition costs of the Tekapo power stations it bought from Meridian Energy on June 1 for $821 million.
Earlier, the company had indicated that its profit after tax would be $40 million for the year ended June but at that stage, no account had been taken of the proposed acquisition of the Tekapo power stations.
Excluding the adjusted after-tax revaluation loss of $73 million, Genesis said it would expect to "comfortably exceed" the $40 million profit.
The company reported an operating profit of $136 million for the six months ended December. Its operating profit for the year ended June was now expected to be in the range of $280 million to $300 million.
Craigs Investment Partners broker Peter McIntyre said the announcement was good news for a company likely to be partially floated if National retained power after the November 26 election.
"It becomes more attractive to investors if the Government puts it up for sale. It is the largest retail operator in New Zealand. It's very aggressive on the retail side of its business.
`Mum and dad' investors understand the company quite well," he said.
The revaluation appeared on the high side, given that some energy companies were struggling with a poor season of electricity sales.
It had so far been a mild winter and lake levels remained high, Mr McIntyre said.
A Genesis spokesman told the Otago Daily Times the revaluations were carried out internally by the corporate finance team and reviewed by external parties.
There were several factors pushing up the revaluations which the company did not want to disclose. However, those factors included the company's long-term view on wholesale electricity prices, the spokesman said.
Mr McIntyre said Genesis was bucking the trend of other energy companies, particularly Contact, which recently announced the Christchurch earthquakes had affected its financial performance.
The ODT reported earlier that the Government would receive a $521 million special dividend from Meridian Energy, thanks to Genesis borrowing money from its bankers to help pay for Meridian's Tekapo assets.
Genesis borrowed $546 million from its senior bankers and raised $275 million from investors to pay Meridian (also state-owned) $821 million.
Meridian paid the Government the special $521 million dividend on June 1, suggesting the value of the assets was really $300 million.
