AGL Energy has missed estimates of underlying profit and lowered its final dividend, as contract provisions weigh on its earnings.
Underlying profit after tax was A$640 million in the year to 30 June, falling by 21.2% and below Visible Alpha estimates of $653.2 million. Revenue was up 6.0% to $14.39 billion.
“The strong financial performance was achieved during FY25 despite reduced fleet availability in the second half of FY25. The FY25 result demonstrates the flexibility and breadth of AGL’s portfolio, including the strong earnings from our growing battery portfolio,” Chair Miles George and CEO Damien Nicks wrote in a letter to shareholders.
EBITDA was $2.01 billion, dropping from $2.22 billion one year ago. The company posted a statutory loss of $98 million, down from a profit of $711 million, which it credited to an increase in contract provisions amid lower forecasted electricity and renewable energy certificate pricing.
Total services to customers grew from 4.48 million to 4.56 million year-over-year. Customer churn declined slightly, from 15.8% to 15.7%.
AGL’s operating costs and capital expenditure were $2.96 billion, compared with $2.63 billion last fiscal year. IAG has been seeking to decarbonise its assets, with the company saying it had committed more than $3 billion to do so over the last three years.
Its final dividend was 25.0 cents per share, fully franked, below the 35.0 cents it declared one year ago.
The company’s guidance projects underlying profit of $500-700 million for the 2026 fiscal year, with the midpoint below estimates of $667.8 million.
"AGL’s FY26 guidance range reflects the significant ongoing investment AGL is making to deliver its long-term strategy. This significant ongoing investment is expected to result in increased levels of depreciation and amortisation over the medium term, which will impact the level of net profit after tax in future years,” wrote George and Nicks.
AGL’s (ASX: AGL) share price closed at A$10.22, up from its previous close at $10.04. Its market capitalisation is $6.88 billion.
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