Genesis Energy Limited

Thank you for standing by. Welcome to Genesis Energy Half Year Results 2026 Analyst Briefing. All participants are in a listen-only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. I would now like to hand the conference over to Mr. Malcolm Johns, Chief Executive Officer. Please go ahead.

Good morning and thank you for joining us. Before we get into the detail, let me briefly outline how we will run today's session. I'll start by covering a quick snapshot of the half-year FY26 and our core investor value proposition before stepping through progress on our Gen35 strategy delivery. Julie will then take you through the group financial performance, FY26 guidance and our outlook to FY32. We will then move to the equity raise we announced to the market today before we open for questions. Let me start by recapping the highlights of our record first half earnings performance. Our FY26 half year normalized EBITDAF was a record 307 million. Over the past 18 months, we have stepped up leveraging our market leading flexibility to drive earnings outcomes. Across FY25, we leveraged our flexibility to defend earnings during periods of low hydro and low wind. For the first half of FY26, we again leveraged our flexibility, but this time to optimize earnings during periods of high hydro and high wind. This is Genesis's competitive advantage and core investor proposition, earnings resilience, no matter the weather. Group operating cash flow for the half was $183 million up 298% on the prior period. Net debt remains well managed and within our target range to support our BBB Plus investment grade credit rating. Over the last calendar year, we delivered total shareholder return of over 13% and the board has declared a half year dividend of 7.3 cents per share in line with current dividend policy. Gen35 is focused on building new renewables into our large, already established customer book, displacing baseload gas generation as quickly as we can, and further leveraging our market-leading flexibility to drive growth. Today, we are updating our outlook for FY28 to upper 500 million EBITDAF and extending our outlook out to FY32. Our FY32 outlook is driven by growing cash from our customer, renewables and flexibility cogs in our strategy, which we will speak to further shortly. As we have previously indicated, once we have embedded our new financial management system, we will be evolving our reporting to reflect these three value pools. This is most likely to be the FY27 half-year results. Margin quality uplift is a strategic deliverable, and during the half, we continued to optimize our customer book through the integration of Frank into Genesis and the full purchase of Ecotricity. Customer churn and net back uplift during this transition played out as expected. A major milestone this half was the first cohort of around 50,000 customers successfully migrating onto Gentrack's G2 platform. The transition went well, and we are quickly seeing encouraging operational and customer benefits. Release 2 is on target for delivery late this calendar year, early next calendar year. Moving now to delivering our renewable generation. In FY23, our development pipeline stood at around 364 megawatts. Today, it is around 2,500 megawatts and will continue to grow. We are on track to deliver our renewables growth objectives of around 500 megawatts of solar, 200 megawatts of BESS through advanced stage and consented sites with grid connections. We completed a partnership agreement with Jensen Renewables for first mover options on PPAs and joint venture wind developments across their 1000 megawatt wind pipeline. This is in addition to the offtake agreement we have with Jensen for 70% of the Mount Cass wind farm in Canterbury. That's scheduled to start construction in quarter three, FY26, with supply expected in quarter one, FY29. Noting that we also have our own existing wind options at Castle Hill, which we are progressing. Defending our earnings in dry, low-wind periods and optimising them in wet, high-wind periods is driven by our market-leading flexibility. We are delivering BEST1, a $135 million 100MW 2-hour battery, which is on track and tracking within budget. BEST2 business case is progressing on track. Adding solar and BEST developments will drive margin uplift across our three hydro schemes, which can store around 500 gigawatt hours in total. Turning now to the delivery of our major technology upgrades, we remain within our target total cost envelope of $145 million. Phasing is currently as indicated. However, there may be some movement between FY26 and 27 for spend that is currently scheduled around the middle of the calendar year. In addition to being live on stage one of G2, we are also now live on our new financial management system, and we are well into delivering our electronic trading and risk management system upgrades. I would now like to hand over to Julie to run through group performance. Julie.

Kia ora, Malcolm, and morena to everyone on the line. As Malcolm outlined earlier, we have delivered a record half-year earnings. with our Gen 35 initiatives continuing to deliver well and the business making good progress as we move through Horizon 2 of Gen 35. Our value proposition that we shared at our Investor Day in November remains strong, and in support of that, you will all now be aware of our most recent capital management strategy activation, being the equity raise offer that we put into the market today. This is an opportunity for our shareholders to invest with us in the acceleration of our growth pipeline of dispatchable firming capacity and new renewable generation, displacing gas from our baseload generation while sustaining our well-established customer position. We will talk more to this offer shortly, but first let me take you through our half-year results for financial year 26, our guidance for the remainder of the financial year, and our outlook to financial year 32. As you will see on slide 12 of the results presentation, Genesis delivered a reported EBITDAF of $303 million and a reported net profit of $95 million, both significantly up on the prior comparable period. The strong financial outcome was delivered through a period of significant supply across the sector due to the extreme weather conditions, driving lower wholesale prices and reducing the need for thermal generation as we brought off the market to meet our customer demands. Our revenue was down 13% overall, largely reflecting lower wholesale prices and reduced generation, while noting that the tactical activity undertaken to rebalance our customer demand mix has delivered higher quality retail margins. Before I speak in more detail about a group gross margin and operating costs, I do want to call out that the half-year results now reflect the accounting for the new long-term Huntley firming options. Our Rankin units are now valued as capacity assets. And we have also brought in a new derivative position for the long-term HFO calls that we expect from our counterparties along with their associated coal and carbon obligations. So moving on to slide 13, our group gross margin was up 27% on the prior period with a notable uplift from our generation mix and overall lower cost of fuel, coupled with an 8% increase in retail margin contribution. Our hydro generation increased by 17% against PCP as we responded to the weather conditions, which gave rise to an uplift in gross margin from displacing thermal generation. This was supplemented by around 250 gigawatt hours of higher generation from our renewable energy PPAs. The dry winter conditions and gas scarcity that featured in the prior comparable period saw a gas price rebalance in the current half, with the average cost of gas reducing by around $3 a GJ. This upside was partially offset by an increase in the cost of coal and carbon. Another call-out is our higher wholesale gas margin, which was enabled in part by tactically extending the shutdown of Unit 5 in a lower-priced environment and redirecting the gas to industrials in Q2. The strong contribution from retail reflects our continued focus on margin improvements. also noting that this result includes a full half year of ecotricity gross margin of around $10 million. And also of note during the half is that we saw a 15% increase in lines and distribution fees against PCP, with these costs being passed through to our customers. Moving across to operating costs, we had a 7% increase in spend against PCP, excluding digital projects. We have taken out around $5 million of costs from multiple initiatives, including our retail operating model reset and changing our insurance structure. However, we also have around $2 million of higher costs across the period as we continue to activate our productivity initiatives with temporary resourcing, and we work through realizing the synergies from our one-brand strategy. As Malcolm mentioned, our major digital transformation projects are tracking well, with financial year 26 being our peak year for the spend. During the half, we incurred around $14 million for our retail billing system and spent around $10 million on our finance system replacement, which went live on the 2nd of February. We continue to prioritise our maintenance projects with a slight ramp up in spend during the half in support of our rank and units activity to ensure they are standby ready for calls under the new LT long-term HFOs. Moving to capital management on slide 14, We generated $183 million of operations-free cash flow after stay-in-business capex. This cash was utilised to fund our dividend commitments and progress our growth investment pipeline in alignment with our capital allocation framework that I shared with you at Invest Today 25. We successfully released around $95 million of cash from our working capital with the establishment of the new coal energy reserve stockpile that is funded by our HFO counterparties. We are now working towards reducing our operational coal stockpile further as our growth investment opportunities advance. Our stay in business capex spend of $43 million for the half remains in line with our expectation for financial year 26 of $130 to $140 million. This spend is elevated in the latter part of the financial year as we ramp up activity, including overhaul and upgrade works for our hydro assets, and activity in support of prolonging the life of the Huntly scheme. Our growth investment spend of $70 million was directed to advancing our Huntly best construction, which is progressing well, and our solar pipeline, including the acquisition of the rights for Rangariri Solar Farm. Moving to slide 15, we continue to remain focused on our balance sheet and the strengthening of our capital management framework as a key enabler for GEN35. The activation of our capital management strategy is well underway, and we are confident that funding will not be an impediment to accelerating our growth investment pipeline and the associated returns growth. We remain focused on financial resilience and our investment grade credit rating, which was recently reaffirmed by Standard & Poor's at BBB+. The board has declared a financial year 26 interim dividend of 7.3 cents per share in alignment with our dividend policy, with a record date of 26 February 2026 and a payment date of 25 March 2026. Our dividend reimbursement plan remains in place as a valuable tool to manage our balance sheet through the cycle and this will continue to be operational alongside the equity raise due to the Crown's ongoing formal commitment to participate. To ensure fairness for shareholders, we've adjusted the DRP pricing mechanism as you see summarised on the slide. Moving now to our retail business, our focus on margin quality is reflected in the 19% increase in total retail netback across all segments. This is a key financial metric that we remain focused on with disciplined pricing, improved customer mix and reduced cost to serve. The reliability of our schemes and operations is another focus area to ensure our generation assets are available to us and to the market when needed, regardless of the season and the shape of the demand. This is a key enabler for unlocking flex for an optimized portfolio position. And as slide 19 shows, how our generation played out across the half with more hydro and increased PPA volumes and a material reduction in thermal, demonstrating how our portfolio flexes to market and weather conditions to protect our margins. And notably, we delivered a 21% reduction in the average cost of generation per megawatt hour against the PCP. As our investment pipeline matures, we will further optimize our portfolio and reduce the cost of generation. So in summary, the financial year 26 half-year financial performance saw us deliver a strong uplift in earnings through margin quality while maintaining cost discipline and a critical focus on the strength of our capital management. Our retail netbacks improved across all segments, our asset reliability was high, and we demonstrated market-leading flexibility across the portfolio. We continued to deliver on what we said we would, and we are focused on uplifting our earnings out to financial year 32, enabled by our pipeline of growth opportunities and our continued focus on productivity initiatives across the group. So moving on to the outlook for financial year 26, our normalized EBITDAF range remains unchanged from the upgrade we issued in January that took our guidance to $490 million to $520 million. The outlook for the second half of the financial year is premised on P50 hydro inflows and features more thermal generation as seasonal demand increases and brings generation cost pressure on gross margin. This all remains subject to hydrology, gas dynamics, plant performance and market conditions. I want to speak now to our outlook for financial year 32 as this is a critical year for Genesis as our growth investment pipeline of opportunities are delivered and activated. As Malcolm shared earlier, we now have a growth pipeline of around $2 billion that is enabling a financial year 32 EBITDAF range of between $650 and $750 million. This pipeline includes a range of advanced stage renewable developments that displays base load gas generation significantly reducing our total cost of generation as indicated on the slide, while leveraging our flexibility and customer demand position. We also continue to progress other GEN35 initiatives that are enabling productivity gains and driving our like-for-like OPEX target of around $380 million in real terms. while noting, though, that there will also be incremental OPEX coming into the business when our investments are operationalised and they start generating the EBITDAF uplift and returns growth. Our primary source of funding over the period to financial year 32 is our own operating free cash flow, which also includes a range of self-help measures, including working capital and inventory management. Operations free cash flow funds our stay-in-business capex and includes all planned major hydro and Huntley maintenance. And it also funds our dividend policy. Any surplus cash will contribute to the funding of our growth investment pipeline alongside the funding toolkit pathways, which now includes our equity raise offer of $400 million. Our capital management framework ensures a credible pathway to accelerate the delivery and returns from our financial year 32 growth pipeline. while maintaining our investment grade credit rating of BBB+. Serving our customers well and growing our total shareholder returns remain at the center of our thinking. We have delivered what we said we would over the past two years, and we are confident we will deliver what we say over the coming years. I'm now gonna hand it back to Malcolm to talk in more detail about our equity raise offer. Malcolm.

Thank you, Julie. The results we've just walked through are not the end point. They are a proof point that the platform is working and that we now have momentum. With a maturing pipeline of consented and advanced stage projects and clear line of sight to higher earnings through to FY32, the question becomes one of timing and capital allocation. To bring forward the highest return elements of that pipeline while preserving our balance sheet settings and dividend framework, we have today announced a $400 million equity raise. Our FY32 growth pipeline is around $2 billion of growth capex and focuses on lowering our average cost of generation and displacing baseload gas to deliver EBITDAF uplift of between $650 and $750 million. Our growth plan is de-risk. because Genesis has an already established large customer demand position of around 6.2 terawatt hours per annum and market leading flexible generation of 1,270 megawatts. Equity from this raise will be used as part of our overall funding toolkit to accelerate delivery of our growth pipeline and drive competitive shareholder returns. The board believes that purposefully accelerating our growth opportunities while maintaining competitive returns for shareholders is prudent at this time. That is the context for the equity raise and size we are proposing. Today's raise is to support accelerating delivery, delivering new renewables from the pipeline, with initial focus being on completing the circa 500 megawatts of solar, 200 megawatts of BES, and life extension of the Rankins we have previously signaled. For investors, Our existing large customer book, three well-placed hydro schemes and market-leading flexibility offers the opportunity to invest into an earnings growth outlook in a de-risked way. That also supports New Zealand's wider energy security and transition. The Crown has agreed to support the raise by pre-committing to subscribe for shares to ensure it retains a 51% shareholding. This support is a reflection of the government's goals for secure and affordable energy in New Zealand, as well as seeing value in the commercial proposition on offer under our FY32 growth plan. Let me recap Genesis today and the context for an equity raise. Genesis is an integrated generator and retailer supplying electricity, gas and LPG with A large established customer book of around 500,000 customers that is geographically spread across New Zealand and all market segments. Three well-placed and geographically spread hydro schemes that can store around 500 gigawatt hours. Market leading flexibility of around 1,270 megawatts growing to around 1,370 megawatts. Competitive PPAs across solar, wind and geothermal. As we have demonstrated across FY25 and 26, we are now leveraging our large customer book and market-leading flexibility to defend our earnings in dry and low wind periods and optimize our earnings in wet and high wind periods. Genesis offers investors earnings reliability and energy transition risk management in a growing market. As we roll out our FY32 outlook and growth pipelines, we will deliver growing cash from the three cogs in our portfolio of customers, renewables, and flexible generation. We are converting that growing margin into operating free cash flow uplift by building cultural foundations around continuous improvement in margin quality, cost discipline, and strong capital management. We have delivered over the past two years, and we are confident we can deliver our growth plan We are in a growth market. By 2050 electricity must be 60% of New Zealand's total energy, that is 30% today. At least 95% of that electricity needs to come from renewable sources, that is around 90% today. Available 100% of the time, regardless of the weather or demand patterns. Interestingly, Moving New Zealand to 60% electrification would save Kiwi homes and businesses around $8-9 billion per annum in today's dollars. Electrification is the quickest way to lower total energy bills for Kiwi homes and businesses. Household and business economics will be the primary driver of growth in electricity demand over the next two decades. The three cogs of Gen35 align to the 60, 95, 100 deliverables for the electricity sector and New Zealand. Incremental capital allows us to deliver for our customers, our shareholders, and New Zealand quicker. The investments proposed in our growth pipeline align with stated government priorities around security of supply, dispatchable capacity, and firming and provide attractive commercial returns for shareholders. As we have outlined, electricity demand in New Zealand is forecast to grow by around 25% over the next decade. This growth is structural and broad-based. It is driven by mass market electrification, EV uptake and large new flexible loads such as data centres and large-scale industrial electrification. This is not low margin commodity growth. This isn't just more load, it is new types of load. Our large established customer book, advanced pipeline, and market leading flexibility will allow Genesis to catch emerging value pools and manage risk within this market growth outlook. As renewables grow, so does intra-hour, day, and week volatility. Solar and wind already require growing levels of firming today and Huntly is being used more to firm wind than in dry year cycles. Increased energy storage and dispatchable capacity remains essential in the New Zealand market across short, medium and long duration periods. Not only can Genesis firm its own current and future requirements across these periods, It can also provide a growing volume of energy and capacity products to the wider market, as we are already demonstrating. Our large established customer book underpins demand growth for Genesis. We are building new renewables in support of that, delivering earnings growth by further leveraging our market-leading flexibility. Through our growth pipeline, baseload gas generation is being displaced as quickly as we can, and Huntley is monetized through short, medium, and long duration firming for the Genesis Customer Book through more energy and capacity products to the wider market. As we outlined at Invest Today, greater energy storage and fuel flexibility options improve the GWAP-TWAP outcomes of our thermal assets. We continue to work through gas storage options at the Tauraki field. Firming is Genesis's competitive advantage. We can firm our customer book through all of New Zealand's hydro and wind cycles across minutes, hours, days, weeks and months. This slide sets out our view of unfirmed LCOE for intermittent renewables, our experience of the real firming cost ranges for intermittent renewables through both energy and HFO style products in dry and wet market conditions. As we outlined at Invest Today, we continue to see firming value pools as growing over the next decade. In FY24, Genesis had a pipeline of around 364 megawatts of solar and wind. Today, we have put in place a pipeline of around 2,500 megawatts, and this is growing. As we have indicated before, we will increase generation supply using on-balance sheets joint venture and pure PPA structures. On balance sheet will prioritize but not be limited to energy storage and dispatchable assets. Joint ventures will be used to leverage third party capital. PPAs will be used tactically to support demand growth and for strong capital management. This slide sets out further detail on our overall development pipeline. The key message for investors is that Genesis has strong optionality, and optionality offers flexibility and value in a transition, overlaid by New Zealand's changing weather patterns. Our capital plan is phased to balance delivering growing operating free cash flows, options for strong capital management, and flexibility to drive competitive shareholder returns. This equity raise and our broader funding toolkit provide a solid foundation for Genesis to accelerate delivery of these outcomes. Solar and BESS are being developed to drive improved GWAP-TWAP into our generation fleet, especially our three hydro schemes. Or, we are investing to better leverage our dispatchable assets into higher price periods and to lower our overall average generation costs. Incremental capital will be used to accelerate delivery of this. By FY32, we expect to deliver the following wind uplifts. The Kaiwakawe PPA around 220 gigawatt hours per annum from quarter three FY27. Mount Cass PPA around 210 gigawatt hours per annum from quarter one FY29. Castle Hill, not less than 800 gigawatt hours per annum from FY32. Noting that FY32 modelling assumes a low case of around 170 megawatts built. We expect to progress further wind options and will update the market in due course. Huntly is not a legacy asset. It is a consented site with a 1400 megawatt grid connection and a unique skilled resident workforce. On that site is a collection of assets, some legacy, some new, alongside a collection of fuels, some legacy and some future focused. When we launched Gen35, we were clear we would not maintain assets that we could not drive a commercially acceptable return from, and we have and will remain true to this philosophy. Over the past two years, we have demonstrated how we are now using the market-leading flexibility we have to defend our earnings during dry, low-wind periods and maximize our earnings through wet, high-wind periods. We have also delivered two- and 10-year HFO products. HFOs are a fixed annual revenue stream with pricing on a return on and return of capital over the contract period, and fuel and carbon costs borne by the HFO holder. We are well into transitioning Huntly into a generation site that supports Genesis's large customer book and the wider sector's firming and security needs. This is good for customers, shareholders, and New Zealand. As we displace baseload gas generation, we intend to bring further HFO products to market on Unit 5. The structure of these will align to the Rankin HFO products and they will be available to all market participants. LMG, should it be developed, would be another fuel type that would be available to holders of future HFOs on Unit 5. Huntley will continue to play a firming role for Genesis and the wider sector, funded through both energy and capacity products. Asset and fuel flex are central to our market-leading flexibility. Leveraging it into earnings, as we have demonstrated over FY25 and 26, is how we are deploying it. Key price points to be aware of are as follows. Gas at around $8 to $10 a GJ through Unit 5 beats current LCOEs for solar, wind, and geothermal. Gas between $10 and $18 a GJ through Unit 5 delivers lower current generation costs than coal through Rankins. Above that, coal through Rankins deliver lower generation costs than gas through Unit 5. The economics of biomass remain currently above coal. LNG will be a fuel in our overall fuel portfolio optionality should it become available. I will now hand back to Julie to step through our capital management and equity offer details. Julie.

Thank you, Malcolm. So our approach to capital management remains unchanged from what I shared with you at Invest Today in November. Each investment we make must enhance our overall portfolio by maximising our risk-adjusted returns across our integrated value chain while maintaining our BBB plus credit rating and our commitment to our dividend policy. As we shared at Invest Today, a critical enabler for strong capital management is ensuring a diverse and flexible funding toolkit that allows tailored capital solutions within the group's overall financial settings. Each funding pathway within our toolkit is used selectively to ensure it is the most credible and appropriate structure for the opportunity. And we are now in the phase of our Gen 35 journey, whereby we believe it is the right time for an equity raise offer of this size to supplement our operating free cash flow and enable the acceleration of the delivery of our growth investment pipeline, bringing more funding certainty and working within the financial settings of the group. We operate in a dynamic and cyclical environment, and this equity raise ensures that we have the resilience and flexibility to continue to invest and grow through volatile cycles to ensure strong returns well into the future. Moving to our pro forma balance sheet, under a mixed ownership model, it is important that this equity raise considers fairness for all of our investors, while providing us with certainty to accelerate our growth investment pipeline. Initially, the cash proceeds from the equity raise will significantly reduce our leverage metrics before being deployed in alignment with the phasing of our growth investment schedule as projects meet the requirements of our framework that ensures the best use of the funds for the targeted returns. So coming back to our financial year 32 outlook that I spoke to earlier, Our normalized EBITDAF guidance for financial year 26 remains in the range of $490 million to $520 million. Our normalized EBITDAF for financial year 28 is increased to upper $500 million from the previously indicated mid to upper $500 million. This increase reflects our delivery to date and our confidence in the initiatives and the investments that we are progressing. And today, we share our EBITDAF outlook range for financial year 32 of $650 to $750 million enabled by our growth investment pipeline of around $2 billion. This is a growth plan and we will be growing our cash flow and our returns. The board continues to believe that the current fixed dividend policy remains appropriate and is likely to continue as we move through Horizon 2 of our Gen 35 toward financial year 28. with an expectation that Genesis may return to a more market-aligned dividend policy beyond that, although noting that this will be a decision for the board at that time. This outlook and the opportunities that it is premised on are all about driving accelerated growth, both in the business and in the returns to our shareholders. The $400 million equity raise is structured as a placement. and a pro-rata renounceable rights offer with the Crown commitment to participate to maintain a majority shareholding of 51%. The balance of the offer is underwritten. The rights offer is renounceable to ensure that those shareholders who cannot participate have the opportunity to realise value for their rights through the shortfall book build. There are a few key equity raise terms that I want to call out now. All shares issued under the placement and rights offer will not be entitled to the financial year 26 interim dividend. The placement share price is $2.15 per share, reflecting an 8% discount to the ex-dividend adjusted NZX last close price prior to the announcement. The rights offer share price is $2.05 per share, reflecting a 10.8% discount to the theoretical ex-rights price. Eligible shareholders that take up their entitlements in full may apply for additional new shares to be sold under the shortfall book build. Details of the timetable are offered in the offer prospectus, but I want to call out the key decision points for investors. For the placement book build, we commenced a trading halt today and placement book build has started. Investors that wish to participate should contact their broker or Jardin today. Trading is expected to resume tomorrow, Tuesday the 24th of February, with settlement of placement shares happening later this week. For the rights offer, shares will trade X rights from Friday the 27th of February, with the record date for determining entitlement being 7pm on Monday the 2nd of March. The rights offer will open on Wednesday the 4th of March and close on Tuesday the 17th of March, giving shareholders just under two weeks to participate. Shareholders that wish to participate in the rights offer should visit the offer website for details. So in summary, this equity raise provides shareholders with the opportunity to invest in a structurally growing electricity market with a differentiated portfolio build around flexibility and reliability, all with disciplined capital deployment and clear pathways to value realization. Genesis is not waiting for the energy transition. We are already monetizing it. And this equity raise allows us to do so faster, at scale, and with confidence. So thank you all for listening, and we're now going to hand over back to the operator to take questions.

Thank you. We will now be conducting our question and answer session. If you wish to ask a question, please press star 1 on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star 2. If you're on the speakerphone, please pick up the handset to ask your question. Your first question comes from Grant Swanepoel with Jarden. Please go ahead.

Good morning, team. Great presentation. First question on your FY28 dividends still being on this incremental policy. If you, as a team, have such strong conviction on high 500s of EBITDA, that strong cash flow conversion at that point, And you've also raised this $400 million. Why aren't you considering revising that dividend policy at that point, seeming you have such a strong conviction on all those numbers at this stage?

Thanks, Grant. Ultimately, the board felt that in this transition period and heavy investment period that the philosophy they took into the fixed dividend held until FY28. As we've indicated, as a matter of good governance, that is reviewed annually. The board is very focused on ensuring competitive shareholder returns, maintaining BBB+, and accelerating our growth investment pipeline. And as indicated at investment day, a move back to a more market-aligned policy from FY29, subject to board decisions at the time.

So it could be reviewed ahead of that. If it's every year, they review it. Last question, just on your FY32 guidance, that free cash flow conversion of 45 to 55 seems a bit conservative. And unless you're using a material maintenance capex, can I ask you what maintenance capex you are assuming in FY32?

Yes, so there are two parts to that one, Grant. The one is that we are still keeping within our $70 to $80 million annualized is the same business capex, but what we have in there as well is the capex spend that prolongs the life of Huntley that was committed under the long-term HFOs. Carry on.

What is that number for the Huntley maintenance capex in that year? In that year or overall? Overall. Well, for your 2032 guidance.

Yeah, across that period, it's in a range of around 100 million.

So it's 100 over and above the 70 to 80?

Yeah, definitely above that, yeah.

Thanks very much.

That's all from me. Thanks, Grant. Thanks, Grant.

We are having some technical difficulty. If I could please have the analysts re-queue in. Once again, we are having some technical difficulty. If we could please have the analysts re-queue in. Our next question is going to be from Andrew Harvey Green with Foresight Bar. Please proceed.

Good morning, Malcolm and Julie. A couple of questions from me. So first one is looking at the FY32 EBITDA assumption, I guess, The earnings uplift would be to some extent how you do the investment. So if you, investments going forward, if you invest in joint ventures, buy joint venture, that doesn't go through, but if you go with offtake agreements, it has a small uplift. And if you do it on balance sheet, it has a more substantial uplift. Can you give us a sense of, I guess, that renewable development total, I think it's six terawatt hour goal, how much of that development you expect to do on balance sheet versus, I guess, other mechanisms?

Yeah, that's right, Andrew. Your statement is correct. And so the base assumption is that we will build Edgecombe, Leaston and Rangariri on balance sheet, best two on balance sheet. We have recycled, or we assume that we will recycle Edgecombe and Leaston to fund wind development and so they move from on balance sheet to a PPA structure and we're assuming the wind in the FY32 is on balance sheet so we haven't assumed any joint ventures with Jensen in that and any joint ventures with Jensen would accelerate baseload gas displacement and so it would be on a simple assessment of what is the highest and best use of capital around Unit 5 and investing in further wind joint ventures?

OK, thanks for that. That's good colour. Next question, I guess, is when the government, when they sort of announced they were prepared to support capital raises, had some expectations around... They were quite keen, I guess, on firming investments. You've announced or indicated you've got the second stage at the best... Have they placed any expectations on Genesis around how that $400 million will be spent?

No. We've put forward our strategy as articulated to the market, and they're investing into that strategy. Okay, great. Thanks.

I think that's all I'll have for now. Thank you very much.

Thanks, Adrian.

Our next question. Our next question is from Denise Nair with UBS. Please proceed.

Hi. Good morning, Malcolm and Julie. Can you hear me? Yes, you can. Good morning, Greg.

Awesome morning. Congrats on the strong result, team. First one is a clarification, really. On your FY32 outlook slide, you have a long-run wholesale price assumption midpoint of $123 a megawatt hour. It's a bit lower than the midpoint from Invest Today. Has your view on long-run price changed at all?

Yeah, so in essence, because we're in an equity rate, we've done a recalculation of that and we've adjusted our range, but we've also broken out in that slide that we spoke to with LCOE and the firming costs for Gnish. So one thing I think is important to understand when you are analyzing the Ford price curve, everyone analyzes it on a P50. And firming becomes materially more expensive when you drop below P40. So what we've tried to display on that slide is the underlying LCOE for solar and wind that we see in the market today. And then a dark gray box, which shows you what a P50 style firming cost range would be. And then there's a lighter gray box, which shows you what a below P40 firming price range might be. So obviously, firming becomes more value accretive in lower hydro cycles. Does that answer your question?

Yep. Yeah, so is it fair to say your long-run price is now 123 midpoint versus, was it 125 last time? Correct.

And that's the figure we've taken into the FY32 modelling.

Okay. And a second question. I suppose just a bit of commentary around Tariki would be helpful. I understand it's a bit of a moving piece at the moment, but just sort of commentary around timing and what maybe the preliminary findings and discussions have sort of led to would be quite helpful. Thanks.

Yeah, as we said at Invest Today, you know, we have an option on Tairiki for this year, and the team are continuing to engage on that. There's substantial subsurface work that needs to be done to establish that it is a viable option as a gas storage facility. At Invest Today, I think we estimated at 8 to 10 PJs in size and so that work is continuing. We are continuing it at pace at the moment and so we want to drive to decisions this year on it.

That's awesome and finally if I might, just around the capital management plan, where do you see net debt peaking and when?

Thanks for that. You know, wind is a big build for us, so really wind is probably where it gets up the highest, so towards the latter end of the period, but it doesn't go over, you know, we're keeping it within our two to three range at the moment, so that's what we've been modelling on, and our sensitivities are around that.

And as I mentioned, you know, that capital recycling out of Edgecombe and Leaston is focused on managing inside that two to three range for the wind build.

Awesome. That's all from me, Tim. Thank you very much. Thank you.

Our next question is from Joshua Dale with Craig's Investment Partners. Please proceed.

Morning, Malcolm and Julie. Can you hear me okay? We can.

Hi, Josh.

Morning. Brilliant. Hi, thanks for the presentation. Just first question, working through a bit of math here. Let's say you do come in add up a $500 million for FY28, call it $590 or so. If you compound that by inflation at 2% FY32, you get TBDAF of $640 million, which is fairly close to the bottom of your FY32 target range. Did you set the bottom of that range such that no new developments need to come online from FY28 onward? No, is the short answer. No. It looks like you get there on inflation alone, I guess is what I'm saying. Yeah.

But what you have to factor in is the decline in coupe. You know, coupe is down to around $20 million by FY32 and the displacement and baseload generation. But once we've finished the solar developments, the next large development is wind, and that's FY32-32. So FY32 is the first year you get the benefit of that.

Okay, thanks.

So I guess what I'm saying is just a blunt, inflation adjusted, you've got to also adjust for the decline in coupe earnings and the forward pricing.

Got it. That's helpful. And on slide 22 of your capital raise presentation, it lists your development pipeline. Just to keep things simple, if at all possible, is there a cutoff on that list? that you see in terms of what developments drive your FY32 targets, or is it everything only needs to happen?

No. So FY32 assumes that we complete the building of Edgecombe, given we've started it, that we progress with the building of Leaston and Rangariri Solar Farms, and that we progress with BEST2, And we progressed with Castle Hill. Those are the underlying development assumptions. Obviously, the rank and life extension sits in there as well.

Great, thanks. And I'm just interested in any comments on the dependence on recycling capital out of solar projects to get TRFY32 targets. How comfortable are you you can find a partner or buyer for those? And I guess, what are the risks to your targets if you can't?

Yep. So there are two dimensions to that. One is based on the discussions we've had in the market, we are confident that we could find capital recycling options. The second is that we have sufficient headroom that if we chose to manage our debt differently, we would still be able to progress even if we couldn't.

Okay, that's helpful. Thanks very much, guys.

Your next question is from Steven Hudson with Macquarie Equities. Please proceed.

Oh, morning, Julie and Malcolm. Hi, Steven. Hi there. Just on the gas diversion, was all of the EBITDA impact there taken in the Coupé EBITDA line?

Yes.

So for the second half, would a kind of like a a more normalized sort of 10 million of EBITDA be a decent guess there?

Yes. So the difference between the first and the second half of FY26 is current gas spot prices aren't conducive to getting that gas away to industrials. So it'll go into generation.

Gotcha. And just a question on Huntley. There's this sort of myth, perhaps I've perpetuated it, but that you have to... burn an ultra-low spec fuel through Hundley to satisfy your conditions of operation, ultra-low ash content coal, and that PT Adara is the only company that can supply you with that, and you've been busy sort of trying to find another supplier, I guess, from a security of supply point of view. Can you kind of pop that myth or validate it?

So in answer to the first part of your question, there is an envelope for ash which we have to remain inside, and that does influence where we can buy coal from. Indonesia sits inside that at the moment. We've obviously signed an agreement with BT Mining for 10,000 tonnes a month from the mine behind Huntly, which also sits inside that. And we have two other mines internationally that we've identified that we can take coal from. and blend with other coal into that. So the diversification of the coal supply chain is well underway. So the answer to the second part of your question is no, we're not solely reliant on Indonesia, and we are opening up other options in New Zealand and other international countries.

And what's PT Adaro like to deal with? I mean, have they flirted with or being instructed by the Indonesian government to adhere to coal export bans, or are they relatively free of those kinds of interferences?

So the Indonesian government has export controls on coal, and they're negative export controls, so they relate to the requirement to sell a percentage of coal extracted to the domestic market. I think that's at 15% or 20% at the moment. And so the fact that it's a negative control means that an increased volume of coal production just means that 20% has to go to Indonesia, 80% can be exported. And we're obviously a very small buyer in the context of that. Japan is the largest buyer in the context of coal exports from Indonesia.

OK. Thanks, Malcolm. That's useful. Just a couple more. Just on S&P, I see that you're calculating the leverage ratio, including capital bonds and your remediation cost, or likely remediation cost for Huntley and Coupe, I suppose. And you're doing that on a 12-month trailing basis. Is that the way Standard & Poor's looks at you, or is it? I know for sort of other companies, they look at sort of three-year forward ratios, for instance.

Yeah. So, no, thanks for that question. No, that is the way that they are looking at us. So it's an EBITDA backward of 12 months, and then those adjustments that you see in there are the adjustments they do.

Got you. And that includes both Coupé and the Huntley Ash Ponds?

Yeah, all our, yeah, our total restoration costs that we're providing for.

Yep. And then just back to, well, sort of two quick ones. Jensen, what's their appetite to put capital to work in renewables, or are they just sort of an EPC player?

No, they're Malaysian-based, and they are very committed to deploying capital into renewables. Obviously, Mount Cass Wind Farm in Canterbury is the first wind farm that they're deploying in New Zealand. We don't have an equity stake in that. We have a 70% offtake. Principal reason is that happened after we had executed the original agreement and Mountcast wasn't part of it, so both parties agreed to leave it out of the original agreement. And, you know, we've obviously had quite substantial discussions with them around our right of first refusal on co-investment and offtake.

Gotcha. That's useful. Last one, I promise. your dividend policy is sort of flat or flat in real terms. So kind of 2% growth out to 2028, I think you're alluding to. So, and then kind of, you know, presumably a percentage of free cash flow from there is what the board will consider. From 2026 to 2032, you've got $2 billion of of CapEx, as a previous question sort of posed. Yes, you've got some revenue streams declining, but what's your best guesses to organic growth in the utility part of your business over that horizon? So, ex-coupe, what's your underlying EBITDA growing for the next sort of six or so years?

So sort of building it up, we see demand growth in electricity between half and 1% out to FY30, a tick over 2% beyond FY30. That's primarily driven by our belief that EV-ICE crossover will happen around FY30. And FY30 plan assumes that our average cost of generation will come down by about $25 a megawatt hour based on... based on the building of the renewables. Baseload gas generation will be gone from around FY30 and Coupé will contribute about $20 million of EBITDAF in FY32. So if you take $20 million off the FY32 number, then you get the ex-Coupé range.

It's going to be, I mean, excluding the sort of return on your $2 billion, it is actually going to be a pretty flat EBITDA.

Well, that's at the bottom end of the range, not the midpoint or the upper end. Maybe take it offline anyway.

We can pick it up with you. Yeah, no, no, that's useful. We can talk to you shortly. All good.

Thanks for that.

There are no further questions at this time. I'll now hand the call back to Mr. Duns for closing remarks.

Thanks, everybody, for listening in. I look forward to catching up with everybody in the next couple of days.

Thanks, everyone. That does conclude our conference for today. Thank you for participating. You may now disconnect.