How Genesis Energy’s $470m EBITDAF Fuels New Zealand’s Energy Future

Robust Financial Performance Amid Market Volatility

Genesis Energy Limited has delivered a strong financial performance for the fiscal year ended June 2025, reporting a 14% increase in normalised EBITDAF to NZ$470.4 million and a 29% rise in net profit after tax to NZ$169.1 million. This growth was achieved despite a challenging operating environment marked by volatile energy markets, declining gas availability, and low hydrological inflows.

The company’s ability to flex its generation portfolio, particularly leveraging the Huntly Power Station’s fuel flexibility, was central to navigating these headwinds. Huntly’s three Rankine units operated at high capacity during dry periods, supported by strategic fuel reserves and long-term capacity contracts, underscoring its critical role in maintaining national energy security.

Advancing the Gen35 Strategy – Renewables and Flexibility

FY25 saw significant progress in Genesis’ Gen35 strategy, aimed at accelerating the transition to a low-carbon energy future. The company commissioned the Lauriston solar farm in Canterbury, New Zealand’s largest solar project to date, capable of generating enough electricity to power approximately 12,500 households annually. Development rights were secured for the Edgecumbe and Leeston solar farms, with final investment decisions targeted in FY26.

In parallel, Genesis commenced construction of a 100 MW/200 MWh battery energy storage system (BESS) at Huntly Power Station, expected to be operational by early 2027. This grid-scale battery will enhance the company’s ability to manage supply variability from renewable sources and support peak demand periods.

Further, the company secured 10-year Huntly Firming Options (HFOs) agreements with Meridian, Mercury, and Contact Energy for 150 MW of capacity, subject to regulatory approval. These contracts, coupled with a strategic fuel reserve of up to 600,000 tonnes of coal, aim to ensure the continued availability of flexible generation capacity through to 2035, reinforcing Huntly’s role as a cornerstone of New Zealand’s energy security.

Retail Brand Consolidation and EV Market Expansion

Genesis consolidated its retail operations by unifying its three brands, Genesis, Frank, and Ecotricity, under the single Genesis brand. This move is designed to simplify customer experience, improve operational efficiency, and accelerate the delivery of innovative energy solutions aligned with the customer-led transition to renewables.

The company also expanded its presence in the electric vehicle (EV) market by acquiring a majority stake in ChargeNet, New Zealand’s largest EV charging network. With over 11,600 customers on its EV plan and growing, Genesis is positioning itself to capture a significant share of the EV market, supporting the country’s shift to sustainable transport.

Commitment to Sustainability and Net Zero 2040

Despite increased emissions from thermal generation due to coal use amid gas supply constraints, Genesis remains firmly committed to its net zero emissions target by 2040. The company’s Science Based Targets initiative (SBTi)-validated goals include a 36% reduction in scope 1 and 2 emissions by FY25 (from a FY20 baseline), which was not met due to external factors, but the company achieved a 55% reduction in scope 3 emissions from sold products.

Genesis continues to invest in biomass supply chains to displace coal at Huntly and is exploring other low-emission fuel alternatives. The company also maintains a strong focus on community investment, employee wellbeing, and cultural engagement, underpinning its sustainability framework.

Capital Management and Outlook

Genesis maintains a BBB+ credit rating and declared a final dividend of 7.17 cents per share, bringing the total FY25 dividend to 14.3 cents per share. The company plans to increase stay-in-business capital expenditure to between NZ$130 million and NZ$140 million and allocate up to NZ$300 million in growth capital expenditure towards renewables and flexible generation projects.

Guidance for FY26 normalised EBITDAF is set between NZ$430 million and NZ$460 million, subject to hydrological conditions, gas availability, plant reliability, and market stability. The company’s upcoming Investor Day in November 2025 is expected to provide further insights into its capital allocation plans and strategic acceleration through Horizon 2 of Gen35.