Mighty River Power has revealed that the Government is privy to financial information that other shareholders don't get.
At the company's first shareholder meeting since listing on the sharemarket in May, chair Joan Withers told investors that it had to give the Crown monthly updates on its finances.
And the company says other Government-controlled listed companies like Meridian and Air New Zealand do the same.
The disclosure that the Crown gets monthly reports on Mighty River's finances came after Milford Asset Management executive director Brian Gaynor asked whether all shareholders get the same information.
In response, Ms Withers told the meeting that it supplied the information to the Crown under a special confidentiality clause, so it can use the information to collate its own monthly accounts.
Mighty River chief financial officer William Meek said it was standard practice among all state-owned enterprises - even listed ones.
"As the majority owner of Mighty River Power we're still subject to the reporting requirements of the Crown, the company does submit monthly financial results to the Crown for the purposes of consolidation, but those results are used only for purposes of group accounting for the Crown."
Fund manager Brian Gaynor says it raises important issues about all shareholders getting the same information.
Mr Gaynor questions whether this practice complies with NZX rules, which require all shareholders to have access to the same information.
Mr Gaynor says, in this case, the Crown is getting monthly updates while other shareholders only get quarterly or half yearly financial reports.
Weak share price defended
Ms Withers also defended the company's weak share price, blaming a perfect storm for its fall.
Mighty River's share price has consistently traded at below its $2.50 issue price, with it closing at $2.19 on Thursday.
But Ms Withers told investors it wasn't the company's fault and it didn't set the share price at the time of listing.
She says a myriad of factors are affecting the share price and it was almost a 'perfect storm' with issues around Tiwai, the Labour Greens policy and an increase in bond yields which has affected stock such as Mighty Rivers'.
Ms Withers says the company is focused on ensuring that shareholders get a good return in the long-term.
Many shareholders at the meeting said although the share price was disappointing, they were not too concerned about it.
Chief executive Doug Heffernan told investors the company's on track to strong growth this financial year, and it expects to pay an interim dividend in March of 5.2 cents per year.
Information needed for fiscal updates
Treasury says it gets the information so it can prepare the Crown's financial statements and economic and fiscal updates.
It says only a few staff get the information and they are not allowed to share it with anyone else including ministers, or anyone advising them.
A spokesperson says the confidentiality deed was explained in the Mighty River Power offer document and has been happening since 2002 for Air New Zealand.
The NZX and securities laywers say this complies with disclosure rules because the information is accessed only for the purposes of collating government accounts.
A Treasury spokesperson says the issue was disclosed in Mighty River Power's offer document.