Quarterly Operational Update

QUARTERLY OPERATIONAL UPDATE
Three months ended 30 June 2020
MERCURY NZ LIMITED QUARTERLY OPERATIONAL UPDATE01
HYDRO GENERATION DOWN 69GWh
DUE TO LOWEST WAIKATO CATCHMENT
INFLOW SEQUENCE FROM SEPTEMBER
REFLECTING DECLINING HYDRO STORAGE
AND DEMAND CLOSE TO NORMAL LEVELS
ELECTRICITY FUTURES PRICES
FALL FROM FY2022
>> QUARTERLY HIGHLIGHTS
SUSTAINED
LOW INFLOWS
HIGH
SPOT PRICES
POST COVID
LOCKDOWN
TIWAI EXIT
ANNOUNCED
>> COMMENTARY
BUSINESS ACTIVITYRESUMES, REFURBISHMENT COMPLETED AT WHAKAMARU AND ARATIATIA
Mercurysuccessfully executed a staged return to normal operations in Q4-FY2020, following the nationwide COVID-19 lockdown, with
office-based staff returning and construction resuming at the Turitea wind farm. Maintenance at our generation sites continued with major
refurbishments completed at Whakamaru and at Aratiatia early in July.
HYDRO GENERATION LOWER DUE TO DROUGHT; GEOTHERMAL STEADY
Mercury's hydro generation decreased from 796GWh in Q4-FY2019 to 727GWh in the most recent quarter due to exceptionally dry
hydrology with Q4-FY2020 Waikato catchment inflows at the 1
st
percentile
1
. Low rainfall in the quarter continued a sequence of low
hydrological conditions with inflows in H2-FY2020 also being at the 1
st
percentile
2
, resulting in full-year hydro generation decreasing from
4,006GWh in FY2019 to 3,712GWh in FY2020. Lake Taupo hydro storage tracked below-average during the quarter ending at 193GWh,
82GWh below average
3
.
Geothermal generation was maintained at 671GWh in Q4-FY2020 versus 679GWh in the same quarter in FY2019 seeing full year
geothermal production 3% lower than FY2019 due to major maintenance.
SALES YIELDS LIFT AS MERCURY FOCUSES ON CUSTOMER VALUE
Mercury's customer value focus saw Commercial & Industrial segment sales volumes increase from 666GWh in Q4-FY2019 to 731GWh in
Q4-FY2020 with the average sales yield (including both physical and financial sales) also lifting by 8.3% (from $86/MWh to $93/MWh).
The Mass Market segment yield increased by 6.4% from $128/MWh to $136/MWh with reduced acquisition activity resulting in lower
volumes.
POST-LOCKDOWN SPOT PRICES REFLECT RETURN TO NORMALITY AND DECLINING NATIONAL HYDRO STORAGE
Demand in the most recent quarter decreased by 4.2% on a temperature-adjusted basis (4.8% on an unadjusted basis) due to the COVID-
19 lockdown. National demand was 14% lower than the pcp in April, when activity restrictions were most severe, but returned to similar levels
to the pcp in May and June as lockdown restrictions eased.
Spot prices in the quarter followed demand, being significantly below-average at $48/MWh at Otahuhu and $42/MWh at Benmore in April.
The easing of lockdown restrictions combined with declining national hydro storage saw spot prices recover strongly, resulting in a quarterly
average spot price of $115/MWh in Auckland, in line with the prior comparable period.
HIGH FUTURES PRICES CHECKED BY TIWAI EXIT ANNOUNCEMENT
As at 30 June, FY2022 futures were $96/MWh and $80/MWh at Otahuhu and Benmore. Following the announcement of the Tiwai
aluminium smelter exit, FY2022 futures have reduced to $79/MWh and $53/MWh respectively, severely impacting the South Island dueto
known transmission constraints.
1
For quarters ended 30 June since 1927
2
For 6-monthly periods ended 30 June since 1927
3
For quarters ended 30 June since 1999

348373
307330
4143
4747
VWAP
1
VolumeVWAP
1
VolumeVWAP
1
VolumeVWAP
1
Volume
(GWh)(GWh)(GWh)(GWh)
1,1081,1534,3614,500
2
7358002,8923,182
3
3733531,4691,318
5458213229
4
1,1631,2114,5734,730
5
8077813,3773,148
3583131,3231,206
6
4494682,0541,942
183180747780
1,3981,4756,3276,703
7277963,7124,006
7
6716792,6152,697
5
46447514781,600
6
46447514781,600
8
1.011.011.021.02
1
VWAP is volume weighted average energy-only price sold to customers after lines, metering and fees
2
Mass market includes residential segments and non time-of-use commercial customers
3
Fixed-price, variable-volume (FPVV) sales to time-of-use commercial customers
4
Excludes spot customer purchases
5
Excludes FTR and trading ASX positions (including positions held to maturity which were previously disclosed in CfD volumes)
6
7
Includes Mercury's 65% share of Nga Awa Purua generation
8
Includes all physical and financial buys and sells except spot customer purchases
MERCURY NZ LIMITED QUARTERLY OPERATIONAL UPDATE02
Spot Settlement of CfDs
PORTFOLIO LWAP/GWAP
101.29113.97
Geothermal (consolidated)
ELECTRICITY GENERATION
Physical
90.8684.28 Buy CfDs
107.17108.62
84.2890.86Financial
134.90124.89
117.43121.59
Hydro
128.97117.19
86.0081.01
110.70109.24
85.79
Other Sell CfDs
117.16111.78
Physical Purchases
Financial
Spot Settlement of CfDs
End User CfDs
OPERATING INFORMATION
Three months ended
30 June 2020
Three months ended
30 June 2019
($/MWh)
Dual Fuel Customers
($/MWh)
South Island Customers
Includes Virtual Asset Swap volumes of 149 GWh for the 3 months ended 30 June 2020 and 149 GWh for the 3 months ended 30 June 2019 and of 601 GWh
for the 12 months ended 30 June 2020 and 599 GWh for the 12 months ended 30 June 2019
ELECTRICITY CUSTOMERS
('000s ICPs)
ELECTRICITY SALES
North Island Customers
Commercial & Industrial
Network Losses
93.07
128.19
100.05
Physical124.20117.45
Mass Market136.45
77.87
86.16
Spot Customer Purchases
83.11
($/MWh)($/MWh)
118.45116.35
Twelve months ended
30 June 2020
Twelve months ended
30 June 2019
115.14145.37
83.6379.60
82.1575.66
130.84126.78
94.0586.35
109.51138.75
117.03142.93
84.5982.04
101.15134.04
104.12136.99
98.81133.37
98.83132.54
83.6993.16
83.6993.16
>> OPERATING STATISTICS

> ELECTRICITY GENERATION BY COMPANY FOR THE THREE MONTHS ENDED 30 JUNE
Source: Electricity Authority
> SHARE OF ELECTRICITY SALES (GWh) FOR THE THREE MONTHS ENDED 30 JUNE (EXCLUDING CFDs)
Source: Mercury Purchases and Transpower SCADA
MERCURY NZ LIMITED QUARTERLY OPERATIONAL UPDATE03
15%
35%
21%
18%
4%
7%
Financial Year Q4 2020
MERCURY
MERIDIAN
CONTACT
GENESIS
TRUSTPOWER / TILT
OTHER
>> MARKET DATA
15%
34%
24%
16%
4%
7%
Financial Year Q4 2019
14%
86%
Financial Year Q4 2020
MERCURY
OTHER
14%
86%
Financial Year Q4 2019

> OTAHUHU WHOLESALE PRICE AND NATIONAL HYDRO STORAGE LEVELS
Source: NZX Hydro and NZEM Pricing Manager (NZX)
> TAUPO STORAGE
Source: NZX Hydro
MERCURY NZ LIMITED QUARTERLY OPERATIONAL UPDATE04
$40
$60
$80
$100
$120
$140
$160
0
1,000
2,000
3,000
4,000
5,000
6,000
JulAugSepOctNovDecJanFebMarAprMayJunJul
$/MWh
GWh
FY2020 NATIONAL STORAGEFY2019 NATIONAL STORAGE
AVERAGE NATIONAL STORAGEROLLING 12 MONTH AVERAGE OTA PRICE
ROLLING 12 MONTH AVERAGE BEN PRICE
0
100
200
300
400
500
600
JulAugSepOctNovDecJanFebMarAprMayJunJul
GWh
AVERAGE SINCE 1999FY2019FY2020

> OTAHUHU ASX FUTURES SETTLEMENT PRICE
Source: ASX
> BENMORE ASX FUTURES SETTLEMENT PRICE
Source: ASX
MERCURY NZ LIMITED QUARTERLY OPERATIONAL UPDATE05
$113.71
$98.54
$94.79
$122.57
$110.25
$95.68
$96.08
$94.10
$93.85
$106.18
$114.01
$95.65
$0
$20
$40
$60
$80
$100
$120
$140
FY20FY21FY22
$/MWh
Financial Year
AS AT 30 JUNE 2019AS AT 31 DECEMBER 2019AS AT 31 MARCH 2020AS AT 30 JUNE 2020
$91.00
$86.19
$85.16
$95.96
$97.29
$85.11
$79.06
$78.63
$70.05
$88.43
$104.40
$79.83
$0
$20
$40
$60
$80
$100
$120
FY20FY21FY22
$/MWh
Financial Year
AS AT 30 JUNE 2019AS AT 31 DECEMBER 2019AS AT 31 MARCH 2020AS AT 30 JUNE 2020

> NATIONAL CONSUMPTION (NON-TEMPERATURE ADJUSTED)
Source: Transpower Information Exchange
> AUCKLAND CLIMATE SUMMARY ( ⁰C)
FINANCIAL YEAR
Q1Q2Q3Q4
202012.316.719.514.4
201912.116.320.214.1
201812.317.220.714.3
201712.116.119.314.3
201611.416.020.615.3
Historical Average (since 1999)11.916.119.414.2
Source: Met Service
> MONTHLY TOTAL CONSUMER RETAIL SWITCHING (ICPs)
Source: Electricity Authority
MERCURY NZ LIMITED QUARTERLY OPERATIONAL UPDATE06
8,778
8,593
8,865
9,022
8,824
8,418
1,255
1,261
1,251
1,252
1,307
1,223
0
2,000
4,000
6,000
8,000
10,000
12,000
Q4 2015Q4 2016Q4 2017Q4 2018Q4 2019Q4 2020
GWh
NATIONAL CONSUMPTIONTIWAI POINT ALUMINIUM SMELTER CONSUMPTION
0%
5%
10%
15%
20%
25%
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
50,000
Jul-10
Jan-11
Jul-11
Jan-12
Jul-12
Jan-13
Jul-13
Jan-14
Jul-14
Jan-15
Jul-15
Jan-16
Jul-16
Jan-17
Jul-17
Jan-18
Jul-18
Jan-19
Jul-19
Jan-20
% Churn
Monthly ICPs
NZ MARKET CHURN (LHS)ANNUAL NZ MARKET CHURN % (RHS)