Meridian Energy Limited (ASX:MEZ) operated its Dividend reinvestment plan for its FY26 final dividend, allowing eligible shareholders in Australia and New Zealand to reinvest their dividend entitlement in additional Meridian shares. The company declared a final ordinary dividend of 16.10 New Zealand cents per share.

Together with the FY26 Interim Dividend of 6.40 cents per share, the final payment took Ordinary Dividends for the financial year to 22.50 cents per share, representing an increase from the previous year.

Latest developments

Meridian reported net profit after tax of NZD 130 million for FY26, compared with a loss of NZD 452 million in FY25. Underlying net profit after tax increased to NZD 308 million from NZD 56 million, while EBITDAF rose to NZD 1.051 billion from NZD 611 million.

Operating cash flow increased to NZD 810 million during the year. The improvement followed stronger hydro generation and record wind output after drought conditions had materially affected the company’s FY25 performance.

The board declared a final ordinary dividend of 16.10 cents per share, taking total FY26 ordinary dividends to 22.50 cents per share. The company also issued more than 9.19 million new shares under the DRP in connection with the final dividend.

Key numbers

Meridian’s FY26 ordinary dividend comprised an interim payment of 6.40 New Zealand cents per share and a final payment of 16.10 cents per share.

The final dividend had an ex-dividend date of 3 September 2026 and a Record Date of 4 September, with payment completed on 22 September 2026.

For the final dividend, the DRP Strike Price was NZD 5.3296 per share. The board applied no discount to the final dividend allocation, compared with a 2% discount applied to the FY26 interim dividend.

About the company

Meridian Energy is a New Zealand electricity generator and retailer with a generation portfolio based predominantly on renewable energy. Its electricity production comes mainly from hydroelectric stations and wind farms.

The company supplies electricity to residential, Business and commercial customers and is listed on both the NZX and ASX.

Meridian is also progressing a pipeline of renewable generation and storage projects, including solar, wind and battery developments. Projects under development include solar generation facilities at Ruakākā and Te Rahui.

How the DRP works

Meridian’s dividend reinvestment plan is available to eligible shareholders with registered addresses in Australia or New Zealand. Participants can apply eligible dividend payments toward additional Meridian shares rather than receiving the entire distribution in cash.

DRP shares are priced using the volume-weighted average sale price of Meridian shares traded on the NZX Main Board over five business days beginning on the relevant ex-dividend date.

For the FY26 final dividend, the pricing period ran from 3 September to 9 September 2026 and resulted in a strike price of NZD 5.3296 per share. No discount was applied, and the plan was satisfied through the issue of new shares.

Why the DRP matters

The DRP provides shareholders with an alternative method of receiving eligible distributions by converting dividend entitlements into additional Meridian shares.

The company can determine whether a discount applies to each dividend reinvestment allocation. This was demonstrated during FY26, when a 2% discount applied to the interim dividend DRP while no discount applied to the final dividend.

Because Meridian issues new shares under the plan, participation increases the company’s shares on issue. Future DRP terms, including any discount, will remain subject to board decisions for each relevant dividend.

What comes next

Meridian continues to focus on renewable generation growth while progressing its pipeline of solar, wind and battery projects. Future operating performance will depend partly on generation conditions, electricity demand, wholesale pricing and execution of development projects.

The company also publishes regular operating updates covering factors such as hydro storage, generation volumes and customer activity, providing ongoing visibility into operational conditions.

Future dividends, payment levels and DRP terms will remain subject to the board’s assessment of earnings, cash flow, Capital requirements and the company’s broader financial position.

Risks and context

Meridian’s Earnings remain materially exposed to hydrological conditions. The difference between its FY25 and FY26 results illustrates the impact that water availability can have on hydro generation and financial performance.

The company is also exposed to wholesale electricity prices, regulatory settings, project execution risks and changes in operating costs. Currency movements can affect the Australian-dollar value of distributions received by Australian shareholders.

The DRP results in the issue of additional shares, which increases the number of shares on issue. Future dividend levels are not guaranteed and remain dependent on financial performance, cash generation and board approval.

Key Insights

Meridian Energy operated its DRP for the FY26 final dividend of 16.10 New Zealand cents per share, with participating shareholders receiving newly Issued Shares at a strike price of NZD 5.3296 and no discount.

FY26 marked a significant improvement in financial performance, with net profit returning to positive territory, underlying earnings increasing and Operating Cash Flow strengthening. The company is continuing to invest in renewable generation and storage projects while managing its exposure to hydrology and electricity-market conditions.