Trustpower’s latest financial result shows the company’s mix of electricity, gas, broadband and consumer electronics pays off.

In the year to March 31, Trustpower saw a net profit after tax of $129 million. That’s up 38 percent on the year earlier. Total revenue for the year climbed five percent from $903 million to $947 million.

Revenue from telecommunications services jumped 23 percent from $65.9 million to $80.6 million. The company is now New Zealand’s fourth largest broadband provider behind Spark, Vodafone and the Vocus Group. 

From Trustpower’s strategic point of view, the important news is that two-thirds of the company’s customers now take two or more utility services on the same account. Five years ago Trustpower CEO Vince Hawksworth outlined a plan to become a multi-utility business. The bundles can include electricity, gas or broadband. 

More than 100,000 customers buy a Trustpower bundle. During the year Trustpower saw more than 3,000 existing customers add broadband to their ‘bundle’. Trustpower says at the end of the financial year it has 87,000 telecommunications customers, a rise of 14 percent on the year. Last week the number stood at 90,000. The company expects to have between 95,000 and 105,000 by the end of this financial year. 

Trustpower’s multi-utility strategy has paid off. In the latest report the company saw gross margins increase by a much faster rate than most utilities experience. For Trustpower bundling is more profitable than selling a single service. One reason for this is that bundling means lower than usual levels of customer churn. The company also says it gets benefits from scale and being able to reduce billing costs when customers buy more than one service.