8 Mar 2002 – Australia Gas Light Company (AGL), the nation’s largest energy provider, yesterday said that one-off factors have drained A$69m ($36m) from the company’s half-year profit. As a result the Sydney-based group posted an A$82.9m net profit for the six months to December 31, down 60 per cent.
It blamed the fall on A$45.5m of losses from its electricity retailing business in New Zealand and a A$45m write-off on its telecommunications retailing business dingo blue.
The market had expected AGL’s one-off items and the company’s shares closed steady at A$9.59. The stock was trading at more than A$12 a year ago.
AGL maintained its partially franked interim dividend at 25c, payable on April 11.
Chairman John Phillips said the full-year net profit outlook was for a result more than last year’s A$115 million and said its retailing business in South Australia was hit by the cool start to summer.
“Sales in South Australia declined 14.5 per cent primarily due to customer losses and very mild weather conditions, resulting in lower electricity demand in the state during the six months,” Phillips said.
The writedown of dingo blue, which was acquired from Optus in December 2000, coincided with an announcement the business would close by June 30. Mr Phillips said the company had undertaken a clearout of its activities in the past year and dingo blue failed to meet its tests.
AGL also announced yesterday a conditional agreement with Papua New Guinea gas producers, led by ExxonMobil, to take gas from PNG to Moomba from mid-2006.
It was the first Australian sale for the A$6 billion PNG Gas project, which proposes to bring gas into Queensland through a 2900 km pipeline from PNG.
The new agreement involves construction of a branch pipeline that would provide a link through Queensland to Moomba in SA’s Far Northeast.
AGL managing director Greg Martin said there were still regulatory, environmental, tax and other issues to be resolved but the agreement was “an important milestone”.
“We expect Moomba to become a major hub for the supply of gas into New South Wales and South Australia as well as providing long-term supply certainty for Queensland,” Mr Martin said.
“Bringing PNG gas into Australia will also deliver supply diversity and renewed upstream competition.”
AGL is part of a consortium chosen to build, own and operate the pipeline from PNG.