SOE Minister Simon Power’s requirement for Govt-owned businesses to start reporting their activities in the same manner as companies listed on the NZX is starting to look like a make-work scheme for investment relations managers. With SOEs dumping out results in the middle of the NZX half-year reporting season, the vast gulf between listed and state-owned companies’ financial disclosure verged at times on the embarrassing. At the most disclosive end of the spectrum in the energy sector: Contact Energy, which appears determined to flush out electricity SOE’s wholesale and retail pricing behaviour by moving to a level of disclosure about its own business in both those areas it may yet live to regret, such is the level of detail.

Contact not only publishes a lengthy management discussion and analysis text, but contributed a pack of slides looking at the most recent result, and another pack giving an “alternative” way of looking at the profit which disclosed, among other things, its retail margins are under intense pressure. On top of this, it puts up four of its senior management team, including MD David Baldwin, for a briefing which goes for as long as there are questions. Next best effort, albeit a long way behind, was Meridian Energy, which released its half-year result with a briefing for journalists and analysts headed by CEO Tim Lusk and newly appointed CFO Paul Chambers, whose verbal dexterity and willingness to cut in on the hard issues inevitably invited CEO-in-waiting speculation. Included was a slide pack with a lot of the important numbers, although nothing like a Contact-style kimono-opening.

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MightyRiverPower scrambled to alert journalists just hours before it released a two page press statement and a bare bones earnings schedule, and held a phone briefing without notes or slides, but which did give access to chair Joan Withers and CEO Doug Heffernan. Trailing by a mile was Genesis, whose results first appeared on an online energy news service, leaving journalists to search the company’s website for a new, fairly deeply buried “continuous disclosures page.” A far cry from the pre-announcement, weeks in advance, of a day and time for release from major listed companies. Genesis did include a slide pack which would have benefited from a briefing, but none was offered.

Perhaps most incongruous is the fact at this stage, most of the SOEs produced no more than basic earnings figures, no balance sheets, and many appear still to be negotiating their interim dividends with shareholding Ministers. This timing mismatch is a function of the ministerial instruction to issue profit results within 60 rather than 90 days of the end of a reporting period, so it’s not really the SOEs’ fault (yet) that parliamentary process and good financial reporting practice have yet to be married. As a dry run for future reporting, the best which can be said about this year’s batch of SOE half-year reporting is it was instructive. Hopefully it will pick up for the full year. It is encouraging, in principle, to see many SOEs issuing statements through the NZX announcements platform, although again, the timing and quality of disclosure was generally haphazard.

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