SYDNEY, AAP – Power company AGL Energy says a rise in global energy demand will boost future earnings, as it takes advantage of rises in domestic wholesale electricity prices.
“With the rise in energy and commodity prices across the globe, AGL Energy is well positioned to benefit from improving wholesale electricity prices seen over the past six months,” CEO Graeme Hunt said on Thursday.
“We expected to see this reflected in future earnings beyond financial year 2022.”
AGL’s bottom line first-half net profit is back in the black at $555 million, after last year’s result was hit by significant and one-off items resulting in a more than $2 billion loss.
The net underlying result was down 40.9 per cent to $194 million, excluding the impact of hedging and other items.
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AGL on Thursday narrowed its earnings guidance for the 2021/22 year.
It now expects pre-tax underlying earnings of between $1.28 billion and $1.4 billion and a net profit between $260 million and $340 million.
“Despite the strong first half performance, earnings are expected to be lower in the second half due to increased costs of capacity to cover periods of peak electricity demand, which are higher in the summer months,” AGL said.
AGL’s demerger plan to create an energy retailer (AGL Australia) and an electricity generator (Accel Energy) is still due to be completed by June 30, pending final approvals.
The two entities will have emissions reductions goals upon listing, putting them on course to reach net zero in coming decades.
AGL will pay an interim dividend of 16 cents, down from 41 cents last year.