APA Group lifts FY profit, to buy Alinta assets

The news: Energy infrastructure owner APA Group has lifted full-year profit ahead of a capital raising that it will use to buy remote power assets from Alinta Energy.

The numbers: Statutory net profit for the year to 30 June rose 10.4% to $287 million, while underlying earnings were up 2% to $1.73 billion. Revenue was up 6.6% to $2.91 billion. APA will pay a final dividend of 29 cents a share, up from 28 cents a year earlier. The company will acquire Alinta’s Pilbara assets for $1.7 billion, and will raise $750 million to support the purchase.

The context: The purchase of the Alinta assets, which includes solar and battery energy storage systems, is the biggest move by APA to boost its renewables exposure. It had previously lost a bidding war for power network operator AusNet to Brookfield. Shares in APA, the country’s biggest gas transport firm, are currently in a trading halt ahead of the equity raising.

What they said: “APA is well-positioned to create long term securityholder value as we pursue key growth opportunities created by the energy transition in select markets where we have a competitive advantage.” CEO Adam Watson said.