21 March 2006

On 20 February we announced a net profit after tax for the six months to 31 December 2005 of $193.7 million, a 14 per cent increase on 2004.

Half year report to Shareholders (2 pages)


The consolidation of Contact Energy’s results for a full six-months (compared with three months for 2004) and a greater contribution from Generation contributed to the improved result.

Sales revenue and other income increased 31% to $3,008 million from $2,291 million in the prior corresponding period, while EBITDA increased 34% to $589 million from $441 million.

Dividends

Shareholders at the record date of 1 March 2006 will receive a fully franked nine-cent-per-share interim dividend on 20 March (up from seven cents for the last half of 2005).

Employees, health and safety

Our number of employees increased by 205 (total 3,357) during the half-year, mostly for the Spring Gully, Kupe and BassGas projects.

It is pleasing that during this period of growth we reduced our lost-time injury frequency rate from 2.7 at 31 December 2004 to 2.5 at 31 December 2005, and our combined medical-treatment and lost-time injuries rate from 20.4 to 19.6.

Outlook

Due to our adoption of ‘successful efforts’ accounting for exploration activities, our 2004 recurring earnings have been restated from $299 million to $288 million for the year ended 30 June 2005.

Given this adjustment, your directors continue to expect that full-year earnings will exceed last years restated earnings base under A-IFRS by 10-15%.

On 20 February Origin Energy and Contact Energy announced a proposal to merge to create Australasia’s largest integrated energy group. A dual-listed structure, with a common board and unified management team, will enable the companies to be run as one business – ContactOrigin.

In the coming months you will receive more information about the proposed merger, which is subject to regulatory, court and shareholder approval.

Kevin McCann
Chairman
Grant King
Managing Director