AGL Energy, Australia's biggest power producer, on Thursday reported a 27.6 percent jump in full-year underlying profit, bolstered by soaring power prices.
Underlying profit for the 12 months ended June 30 rose to A$1.02 billion ($757.8 million) from A$802 million a year ago, beating forecasts of around A$995.2 million, according to Thomson Reuters I/B/E/S.
AGL also said it expected underlying profit in the range of A$970 million to A$1.07 billion for fiscal 2019. "This increase in prices in the broader electricity market has mostly been a result of the abrupt closure of non-AGL power stations such as Hazelwood in 2017 and Northern in 2016 and higher input costs for coal and gas," AGL Chief Executive Andy Vesey said.
AGL and its rivals have all benefited from soaring household electricity prices, which have turned into a hot political issue and put pressure on the energy retailers to cut power bills.
At the same time, AGL has been pressed by the government to keep its ageing Liddell coal-fired power station open beyond 2022 to ensure there is back-up for intermittent wind and solar power.
AGL has instead opted to replace Liddell's capacity with a A$1.36 billion combination of gas-fired plants, an upgrade of another coal-fired plant, renewable power, demand response and possibly some energy storage.
In May, AGL turned down an offer from Chinese-owned Alinta Energy for Liddell, looking to hold on to the plant for the cash it could make for another four years.
The company raised its full-year dividend to A$1.17 from A$0.91 a year ago.
Energy world