Contact Energy says lower wholesale prices and higher thermal generation costs have resulted in a flat half-year underlying profit.
The energy generator and retailer made $80.1 million in the six months to December, compared to $79.9 million in the same period a year earlier .
Overall during the period, Contact made a profit of $88.1 million dollars, more than triple the amount in the same period a year earlier.
But that reflected a $90 million gain in the fair value of its financial instruments under the accounting rules.
Once that and one-off items are excluded, the result is more sobering.
The company says lower wholesale prices, transmission constraints and higher thermal generation costs offset higher returns from retail sales and heavy cost cutting.
Contact is trying to reduce the effect of weather on its earnings by investing in geothermal energy, and more efficient gas fired power plants.
The number of electricity customers fell 4% to 478,000 as its rivals took advantage of Contact's price hikes in late 2008 to poach users.
Contact is again lifting retail prices, and its chief executive, David Baldwin argues current prices are not reflecting the true cost of energy, and new power plants are under threat unless prices rise.
Mr Baldwin says retail competition remains intense and Contact will be faced with a further increase in gas costs in the second half of the financial year.
Reuters news agency says analysts are expecting Contact to make a full year profit of $174 million.
Contact's share price has fell 14 cents to $5.66 on Friday morning.