AGL Energy has posted a better than expected full year underlying profit of $802m - a 14.4% increase on the prior year. The result was boosted by solid demand, better base prices for wholesale electricity & higher margins.
AGL saw a small decrease in gas sales volumes hit by lower consumer accounts, particularly in NSW, and a fall in Queensland wholesale gas margins. This had previously been flagged by the company to the market.
The fact that in 2016 the company was hit with impairment changes and restructure costs from exiting its gas exploration business helped increase returns over the 2017 financial year.
The company said it is continuing to invest in sustainable energy while its coal-dominated electricity business continue to grow. In FY17 average customer accounts fell 1% to 3.65 million and average cost per account increased by 1%.
AGL said it had chosen Victoria’s Point Crib to build its LNG import terminal over Port Adelaide and Port Kembla. The company said it will invest $250 million in the project and commence construction in 2019. AGL plans to have the terminal up and running by 2020/21.
AGL said it expects its FY18 earnings to be between $940 million - $1.04 billion on continued growth from its electricity unit, and margin improvements from gas. The company has also planned to lift its rehabilitation spend by $69 million to $307 million. This will cut FY18 underlying profit by $11 million.
AGL will pay a second half dividend of $0.50 a share on 22 September 2017.
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