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Infratil reported a first-half loss of $206.4 million from its year-ago net profit of $1.19 billion, but a rise in underlying earnings at its flagship holdings CDC Data Centres and One NZ.

Shares were up 1.9% to $12.65 in midday training. The stock is up 19% for the year.

The swing to a loss was pinned on accounting. The infrastructure firm said the prior year “included a $1.1b accounting revaluation of Infratil’s stake in One NZ, with the current period impacted by elevated amortisation relating to that transaction and -$63m of foreign exchange and derivative revaluations”.

Proportionate Ebitdaf (earnings before interest and taxation, depreciation and amortisation and fair value adjustments) basis – or Infratil’s share of operating earnings from all of the companies it owns or part-owns – increased by 25% to $506m.

The firm said the figure reflected its first period of full ownership of One NZ. On a like-for-like basis, proportionate Ebitdaf was up 7%.

The company reduced its full-year proportionate Ebitdaf guidance by a fraction to $960m-$1.00b from the previous $962m-$1.01b as CDC, Wellington Airport and One NZ had no forecast change, but Longroad Energy was chipped down to US$55-60m from the previous US$60-70m.

An unimputed interim dividend of 7.25 cents per share was declared – a 3.6% year-on-year increase.

“Strong independent valuation uplift in CDC offset by slower valuation growth in Longroad” saw net incentive fee accrual of $93.6m for Infratil’s manager, Morrison, up from the year-ago $80.8m.

Infratil chief executive Jason Boyes. Photo / Mark Mitchell

There was no news on CDC, where there has been speculation Infratil, which holds a 48% stake, could make a play for the 12.5% stake reportedly put on the block by Commonwealth Superannuation Corporation – or use the transaction as an opportunity to sell down its stake in the red-hot firm.

Infratil reiterated its support for Contact to buy 100% of Manawa Energy. Infratil values its 51.1% stake at $800m.

Profit up at One NZ

Given Infratil only has a partial stake in most of its assets, most numbers were already on the table, bar the 100%-owned One NZ.

Forsyth Barr preview note fears that “some of the headwinds Spark is facing, specifically with corporate mobile, has impacted One NZ as well” proved unfounded.

“Enterprise softness is stabilising,” Infratil said.

The telco’s Ebitdaf for the six months to September 30 rose 9% to $304m as operating costs fell by $14m.

The figure excluded the costs of setting up One NZ’s new EonFibre unit, a wholesale fibre operation. There has been some market chatter that the fibre assets have been wrapped up for a possible sale. One NZ head of sustainability and corporate affairs Nicky Preston told the Herald, “We currently have no plans to sell EonFibre, and instead plan to operate it as a dedicated business within our overall group to grow and expand our valuable fibre network.”

Mobile average revenue per user per month (Arpu) increased to $33.80 from the year-ago $32.45, although overall first-half revenue tipped to $940m from the year-ago $963m.

The telco’s full-year revenue guidance remains at $580-620m.

Infratil said One NZ’s Direct to Cell partnership with SpaceX-owned Starlink – targeted by the Commerce Commission earlier today over 100% mobile coverage claims – had testing under way. “Pending US licence approvals, commercial launch is expected later in FY25,” the firm said.

Longroad faces Trump headwinds

Infratil warned earlier this year a changing of the guard in the White House could impact Longroad Energy, the Boston-based solar farm operator in which it has a 37.3% stake.

“US election results create uncertainty until the implications for green policies such as the Inflation Reduction Act (IRA) and tariffs are known,” Infratil said today. There was “modest exposure” for some FY2025 and FY2026 projects totalling 2 gigawatts of capacity, while two FY2025 projects (0.7GW and 0.5GW) were already “safe-harboured” with tax credits under the IRA.

The firm aimed to “safe-harbour” a further 0.8GW of FY2026 projects “early in the New Year” ahead of any new legislation.

There was also “potential exposure to tariffs”. Solar farms have boomed over the past couple of years, in part because of over-production of solar panels in China that has crashed the price of imports.

The 2022 Inflation Reduction Act, which provided US$369b ($621b) to spur green infrastructure and decarbonisation, was a Biden administration centrepiece.

Trump has promised to gut the legislation, which he has labelled “the green scam”, and withhold US$104b in IRA funds yet to be allocated.

The President-elect has been nakedly hostile to all forms of support for clean energy and frequently promoted conspiracy theories about wind and solar on the campaign trail. Trump put coal lobbyist Andrew Wheeler and oil lobbyist David Bernhardt in charge of environmental efforts during his first term and is expected to make similar appointments on his return.

There is a “potential industry slowdown until uncertainty is resolved, which may take time”, Infrail said.

“However, US renewables fundamentals remain strong, driven by escalating demand for decarbonisation solutions, as well as rising power demand.”

Its 48% stake in CDC (valued at $5.2 billion), 100% stake in One NZ ($5.2b) and 37% stake in Longroad ($1.99b) easily remain Infratil’s biggest assets, followed by its 66% stake in Wellington Airport ($624m).

Chris Keall is an Auckland-based member of the ����������’s&�Բ�����;business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.