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Australia's AGL forecasts lower annual core earnings on weak power prices

Published 11/02/2021, 09:07 am
Updated 11/02/2021, 10:12 am
© Reuters.
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Feb 11 (Reuters) - Australia's AGL Energy Ltd AGL.AX forecast lower core earnings for fiscal 2021 on Thursday as falling power prices and an outage at a coal-fired plant in New South Wales wiped more than a quarter of its half-yearly profit.

Traditional power retailers in Australia, such as AGL and Origin Energy ORG.AX , have come under pressure due to a slump in wholesale power prices and government plans to underwrite new power plants.

Sydney-based AGL said it expects annual core underlying earnings of between A$1.59 billion and A$1.85 billion ($1.23 billion-$1.43 billion), compared with A$2.07 billion a year earlier.

Its underlying profit, which omits one-off items, came in at A$317 million for the six months to Dec. 31, compared with A$432 million a year ago. RBC had estimated a figure of A$275 million.

"Our 1H21 result reflects the sharp decline in wholesale prices for electricity and large-scale renewable certificates over recent times," Chief Executive Officer Brett Redman said in a statement.

AGL, Australia's top power producer, booked a statutory loss after tax of A$2.29 billion, hurt by a one-off charge of A$2.69 billion due to writedowns of previously signed wind energy contracts and the dour outlook for power prices. declared an ordinary interim dividend of 31 Australian cents per share and a special dividend of 10 Australian cents.

The company left its fiscal 2021 underlying profit outlook unchanged at A$500 million to A$580 million, having slashed it in December after the outage at its coal-fired Liddell plant. = 1.2953 Australian dollars)

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