Genesis Earnings: Weak First Half as Expected; Guidance Unchanged

Narrow-moat-rated Genesis Energy had a weak first half fiscal 2024, mainly because of lower hydroelectric output and an outage at Huntly Power Station. Higher operating costs, related to more IT systems spending and general inflation, also hurt. However, the weak result was expected, and management kept EBITDA guidance of NZD 430 million for fiscal 2024 and NZD 500 million for 2025. We leave our earnings forecasts largely unchanged and maintain our NZD 2.70 per share fair value estimate. The stock is currently fairly valued.