New Zealand Professional Investment Services Firm

Forsyth Barr

We are proud to be a New Zealand owned firm, with 21 offices throughout the country and over 300 employees. We assist personal, institutional and corporate clients providing a full range of investment services.

Forsyth Barr is a foundation New Zealand Exchange firm (NZX) and accredited market participant. We have been confirmed by the Financial Markets Authority as a Qualifying Financial Entity (QFE).

Research is the cornerstone of our advice. We have one of New Zealand's leading teams of analysts. Our global affiliations ensure comprehensive research coverage of all major investment markets.

New Zealand Professional Investment Services Firm, Forsyth Barr

Equity Bottom-Up

<ul><li>FY24 has been a watershed year for Meridian Energy (MEL), following the signing of the landmark NZAS contract and a strong operating performance that will deliver record EBITDAF earnings.</li><li>Whilst MEL's June 2024 performance was solid, it was down on recent months as dry hydro conditions impacted earnings; we expect the trend to continue into FY25.</li><li>The flipside of lower hydro generation is high wholesale electricity prices, which should help lift FY26 and beyond earnings. We increase our target price +15cps (+2.3%) but retain our UNDERPERFORM rating, with MEL remaining the most expensive electricity stock.</li></ul>

FY24 has been a watershed year for Meridian Energy (MEL), following the signing of the landmark NZAS contract and a strong operating performance that will deliver record EBITDAF earnings.Whilst MEL's June 2024 performance was solid, it was down on recent months as dry hydro conditions impacted earnings; we expect the trend to continue into FY25.The flipside of lower hydro generation is high wholesale electricity prices, which should help lift FY26 and beyond earnings. We increase our target price +15cps (+2.3%) but retain our UNDERPERFORM rating, with MEL remaining the most expensive electricity stock.

Meridian Energy - Closing Out a Watershed Year — June 2024