REPORTING SEASON: Origin Energy Limited (ORG)

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Figure 1: Origin Energy Limited 12 month chart

 

Origin Energy (ORG) reports a full year loss as expected and weak future guidance

– Origin Energy (ORG) reported a statutory loss of $658Million for FY15. ORG posted a $705Million impairment charge due to the slide in oil and gas prices which decreased the value of its assets and the value of its Contact Energy investment. Origin had updated the market on these expected impairment charges throughout the year. The removal of carbon tax credits cut ORG’s revenue by a further $832Million.

– Origin Energy also announced it will look to cut more spending and has initiated a company-wide project to further improve efficiency and reduce cash costs by $200 million from FY17. Today they announced they will be cutting almost 800 jobs in the near future.

– Origin plans to cut CAPEX growth even after affirming its plans to spend $24.7Billion on its new J/V (with ConocoPhillips) East Coast gas export project

– Origin said it expects earnings in the energy markets to be flat in FY16 and that they expect margins to be slimmer on its Liquid Natural Gas (LNG) related contracts.

– Even with the big slide in profit ORG said it will pay a final dividend to shareholders of $0.25 a share (in line with market expectations) on the 28th of September 2015.

 

You can see all of CommSec’s reporting season analysis by clicking here.

Juliana Roadley, Market Analyst,