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Origin boosts outlook on energy surge


Origin Energy has boosted its profit outlook for underlying earnings by as much as $80 million as gas and electricity profits surge and coal deliveries improved.

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At its Curtis Island LNG, Origin has downgraded its production forecast because of wet weather but said its LNG trading business had improved on the back of favourable hedging which had led to an additional $140 million to $180 million of trading EBITDA.

There were no forecast impacts from the Federal Government’s $12 a gigajoule price cap on gas because it almost all of the company’s contracts were struck before the cap came into affect.

“The guidance excludes the potential impact of any compensation Origin may receive to recover coal costs that exceed the legislated coal price cap of $125 a tonne, or further coal supply contracts that may be executed at the capped price, noting the mechanism and timing through which the Government policy will be administered remains uncertain,” the company said.

“The energy markets business is expected to earn a return on capital employed in full year 2023 of less than 4 per cent, at the top end of the guidance range.”

Origin expects the energy markets business to deliver an underlying EBITDA to be between $600 million and $730 million, an increase from its previous range of between $500 million and $650 million.


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