AGL reports Underlying Profit increase of 24.8 percent

AGL Energy Limited (AGL) today reported a statutory net profit after tax of $308 million for the six months ended 31 December 2014. This was up 18.0 percent on the prior corresponding period, including changes in the fair value of certain electricity derivatives, and $128 million of significant items associated with the acquisition of Macquarie Generation.

AGL’s Underlying Profit of $302 million was up 24.8 percent on the prior corresponding period. Underlying Profit1 is the statutory net profit after tax adjusted for significant items and changes in the fair value of certain electricity derivatives.

AGL reaffirmed guidance for FY15 Underlying Profit of $575 million to $635 million, subject to normal trading conditions for the remainder of the year.

AGL has declared an interim dividend of 30.0 cents per share fully franked which, after taking into account the bonus element of the recent rights issue, is an effective increase of 4 percent per share.

Result Overview:

  • Revenue $5,183 million, down 2.0%
  • Statutory NPAT $308 million, up 18.0%
  • Underlying Profit1 $302 million, up 24.8%
  • Statutory EPS2 48.6 cents per share, up 7.8%
  • Underlying EPS2 47.7 cents per share, up 14.1%
  • Underlying Operating cash flow before interest & tax $879 million, down $128 million
  • FY15 interim dividend of 30.0 cents per share (100% franked), unchanged 

Commenting on the interim results, AGL Managing Director, Michael Fraser, said: "This is a pleasing result. Both our Retail and Merchant businesses performed well with improvements in the underlying business and the contribution from AGL Macquarie more than offsetting the effect of the repeal of the carbon tax on our renewable assets and the loss of transitional assistance at AGL Loy Yang.

"Retail competition remained intense during the period but the quality of AGL’s customer service and product offering has continued to result in customer retention rates significantly better than our competitors", said Mr Fraser.

After more than seven years in the role of Managing Director and Chief Executive Officer, Michael Fraser retires today and Andy Vesey, previously Chief Operating Officer of The AES Corporation, takes over the position effective from 12 February 2015.

Dividend: AGL has declared a fully franked interim dividend of 30.0 cents per share.

The interim dividend will be paid on 25 March 2015. The record date to determine shareholders’ entitlements to the interim dividend is 26 February 2015. Shares will commence trading ex-dividend on 24 February 2015.

The AGL Dividend Reinvestment Plan (DRP) will operate in respect of the dividend. Shares will be allotted at no discount to the simple average of the daily weighted average market price at which AGL’s ordinary shares are traded on the ASX during each of the 10 trading days commencing on 2 March 2015.

The last date for shareholders to elect to participate in the DRP for the FY15 interim dividend is 27 February 2015.

Outlook: AGL reaffirmed Underlying Profit3 guidance of $575 million to $635 million for the 12 months ending 30 June 2015, subject to normal trading conditions for the remainder of the year.

AGL expects Underlying Profit in the second half of the financial year to be approximately the same as reported for the first half. The southern States of Australia have experienced soft demand so far this summer. AGL expects retail market competition to remain intense for the remainder of the financial year.

Conference call: A webcast and conference call will be held today to discuss AGL’s 2015 interim profit result.

A webcast and conference call will be held today to discuss AGL’s 2015 interim profit result.

  • Webcast via: www.agl.com.au 10.30am (AEDST)
  • Dial In numbers: Toll Free Australia:1800 801 825 (quote “AGL”)
  • International Dial In: +61 2 8524 5042 (quote “AGL”)

1. Underlying Profit has been presented with reference to the Australian Securities and Investment Commission Regulatory Guide 230 "Disclosing non-IFRS financial information". AGL’s policy for reporting Underlying Profit is consistent with RG230. The Directors have had the consistency of the application of the policy reviewed by Deloitte.

2. Adjusted to reflect the bonus element of the 2014 rights issue.

3. Moranbah is classified as "held for sale" and, in accordance with accounting standards, is no longer depreciated. If, at 30 June 2015, a sale has not been completed or the asset is no longer classified as being held for sale, non-cash depreciation of approximately $25 million (pre-tax), for the period 1 January 2014 to 30 June 2015, would need to be recognised. No profit on sale is assumed for purposes of providing Underlying Profit guidance.

Full Media Release and Investor Presentation

Appendix 4D, Directors Report and Financial Report

About AGL

AGL Energy Limited (AGL) is one of Australia's leading integrated energy companies and is the largest ASX listed owner, operator and developer of renewable energy generation in the country. Drawing on over 175 years of experience, AGL operates retail and merchant energy businesses, power generation assets and an upstream gas portfolio. AGL has one of Australia's largest retail energy and dual fuel customer bases. AGL has a diverse power generation portfolio including base, peaking and intermediate generation plants, spread across traditional thermal generation as well as renewable sources including hydro, wind, landfill gas and biomass. AGL is taking action toward creating a sustainable energy future for investors, communities and customers.