Origin Energy climbs despite flagging lower profit for half-year
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More news: Shares in Origin Energy rose in early trade despite reporting a 45.2% year-on-year decline in half-year statutory profit driven by lower realised liquefied natural gas (LNG) prices and volume.
Shares rose 4.61% to $11.58 at 11:12am AEDT.
RBC Capital Markets analyst Gordon Ramsay said the earnings impact from LNG pricing was less severe than expected and partly offset by strong performance in energy markets, despite unplanned Eraring downtime and subdued electricity market conditions.
Ramsay said earnings from Octopus Energy are expected to be positive in the second-half of FY26. He maintained a sector perform rating on the stock with a target price of $13.50.
Origin Energy half-year profit slides 45% amid LNG slump
The news: Energy retailer and gas producer Origin Energy reported a 45.2% year-on-year decrease in half-year statutory profit to $557 million, missing average forecasts of $574.81 million, according to Visible Alpha, amid lower realised liquefied natural gas prices and volumes.
The numbers: Underlying EBITDA came in at $1.59 billion, done from $1.93 billion in the previous corresponding period and ahead of the expected $1.53 billion.
Origin's share of UK joint venture Octopus Energy also posted an underlying EBITDA loss of $89 million.
The company declared a fully franked interim dividend of 30 cents per share, in line with the consensus estimate and is the same as the previous corresponding period.
The company has upgraded full-year guidance for underlying EBITDA at the Energy Markets division has been increased to the range of $1.55 billion to $1.75 billion, up from previous guidance of $1.4 billion and $1.7 billion.
The capital expenditure guidance range has been narrowed from $900 million and $1.1 billion up from $800 million and $1.1 billion, mainly due to the extension of Eraring battery two.
The context: The integrated gas division saw an underlying EBITDA decline due to lower realised LNG prices and volumes at the Australia Pacific LNG joint venture as well as lower Origin LNG trading gains.
The loss for Origin's share in Octopus Energy is due to continued investment in scaling the non-UK retail and energy services as well as UK regulatory costs and smart tariffs investment. This offset the profitability of Kraken Technologies.
The source: ASX
