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Friday August, 1st 2003

2003 ANNUAL REPORT ANNOUNCEMENT

Northpower is pleased to announce a net profit for the financial year ending 31st March 2003 of $9.4m. The Board has also declared a final dividend of $3.3m to be paid to the Northpower Electric Power Trust. Chairman, Warren Moyes, said "the result was achieved in addition to the company providing a $6m Line Charge Holiday to customers during February 2003, and furthermore did so with the lowest average distribution charge of the 29 Network companies in New Zealand".

The total income for the year was $65.3 million, with the Contracting Division portion of this being 51% overall. The total income grew 14% with the net contribution before the line charge holiday and tax, increasing by 59% on last years result.

During the year the company cemented its position as a leading supplier of electricity distribution, network maintenance and construction services through securing an extended performance based contract with New Zealand's largest network based company VECTOR. The contracting business expansion into Tauranga has also proved very successful, and has enabled a further depot to be established in Rotorua. Another contracting division has also been opened in Auckland's North Shore to cope with strong demand for our services.

The financial performance of the Network Division was well above expectations due to higher load growth (4.6% for the year) and lower transmission costs. Wairua Power station made a higher than forecast contribution due to the relatively high spot prices on the wholesale market. Network reliability SAIDI (average number of minutes per customer that power is not available) improved over the previous year by 16 minutes, from 188 to 172 minutes. Safety remains a priority for Northpower with the Company's lost time injury frequency rate dropping from 9 injuries per million hours worked in 1999 to 1.5 injuries per million hours worked in 2003, a result which puts Northpower up with the top of the industry world wide.

"Northpower remains focused on ensuring we consistently perform to very high standards and that we take every opportunity to develop an efficient business for the benefit of the Northland community" Mr Moyes said.

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