In recommending dividends payable to shareholders, the Group will follow the procedures laid down in the Companies Act 1993 and those generally adopted by directors of publicly listed companies and in accordance with Sections 13 and 15 of the State-Owned Enterprises Act 1986. The actual dividend payments are subject to review by the Directors of Mighty River Power. The dividends declared will be determined by reference to:
the Group’s working capital requirements and the medium term asset investment programme.
a sustainable financial structure for the Group, having regard to the Company’s long-term credit rating of BBB+ assigned by Standard and Poor’s (or equivalent from a recognised credit rating agency), the risks from predicted short and medium-term economic, market, and hydrological conditions, and forecast financial performance.
Providing these conditions are met, the dividend pay-out ratio will be set in the range of 90-110% of net profit after tax after adjusting for the impact of NZ IFRS fair value movements of financial instruments net of tax each year and any accounting impairments. Dividend payments will be split into an interim dividend paid in March, targeting 40% of the total forecast dividend for the financial year, and a final dividend paid in September.