Shares in the Kiwi energy group have been placed in a trading halt ahead of a proposed share placement and share purchase plan (SPP) announcement.
The halt is in place until the earlier of an announcement or Wednesday’s open, with an announcement expected by 1 pm tomorrow.
Why is the Contact Energy share price on watch?
Contact Energy is the second largest New Zealand energy company. It operates as an electricity generator, natural gas wholesaler and electricity, natural gas, broadband and LPG retailer. The Kiwi energy group has a market capitalisation of $5.1 billion with a 4.99% dividend yield.
The Contact Energy share price will be worth watching when it returns to the boards after its latest monthly update.
Contact’s customer business recorded mass market electricity and gas sales of 261 gigawatt hours (GWh). That figure was down from 297 GWh in January 2020. Mass market electricity and gas netback was up to $103.59 per megawatt hour (MWh) versus $88.97/MWh last year.
In the wholesale business, contracted electricity sales (including those sold to the customer business) edged lower to 574GwH versus 579GWh last year.
Electricity generated (or acquired) fell to 645GWh versus 654GWh in January 2020 while unit generation cost totalled $28.78/MWh versus $31.93/MWh last year.
Geothermal and hydro continue to contribute a large portion of wholesale electricity generation as generation costs edged lower in January for both key sources.
The Contact Energy share price has had a soft start to the year. As at Friday’s close, shares in the Kiwi energy group had fallen 16.8% for the year so far to $7.13 per share.
In contrast, the S&P/ASX 300 Index (ASX: XKO) has edged 1.9% higher in 2021 to 6,795.70 points.
What about other ASX energy shares?
The Contact Energy share price is not the only ASX energy share under pressure lately.
That means demand from key industries like manufacturing and travel may remain more subdued than initially forecast.