AGL Energy raises its annual profit range and says it is well placed during the fuel crunch
AGL Energy, based in Australia, raised its 'lower end' of annual profit forecast on Wednesday. It credited better plant performance and tighter control over costs, saying it was well positioned for the next 3 months, during the global fuel shortage.
Australia's largest power producer expects underlying net profits after tax to range between A$610 and A$680 millions ($437.98 and $488.24million) in 2026, compared to the A$580 and A$680million previously expected. Visible Alpha consensus was A$646.3?million.
Visible Alpha also increased its estimate for annual operating profits to A$2,06 billion to A$2,18 billion. This is a significant increase from the A$2.02 - A$2.18 bn previously anticipated and Visible Alpha's A$2.14 bn estimate.
AGL shares rose by 0.42% Wednesday, while the S&P/ASX200 index was up 1.3%.
AGL's Chief Executive Damien Nicks stated that despite the Middle East conflict causing disruptions to diesel supplies in Australia, AGL had enough fuel on hand for 90 days.
Diesel is used to start and shut down the coal-fired unit, heavy machinery, and trucks.
We're comfortable with our supplies. He told the Macquarie Australia Conference, in Sydney, that we can continue to access diesel.
We believe that we will continue to receive it as a provider of essential services.
AGL attributes the upgraded forecast to increased plant availability, flexibility, and a strong performance by its thermal generation fleet. It also credits improved customer market performance, as well as disciplined cost control.
Tim Waterer said that despite the challenges of the sector, including high fuel prices and geopolitical risk, well-run operators who have diversified assets with strong cost controls can still navigate this environment.
Waterer stated that the?energy sector in Australia is experiencing a positive?sign.
AGL, Australia’s largest corporate emitter of carbon, announced in February that its goal was to reduce net operating costs by A$50m in FY27.
The company warned on Wednesday that it would be under pressure in fiscal 2027 due to softer market conditions in the United States and abroad, as well as lower wholesale prices in certain locations.
AGL will consider these factors when presenting its 2027 forecast at its annual results, which are due to be presented in August, along with the contribution of its Liddell Batteries project and cost-savings measures.
A grid-scale 500 MW battery is being installed in New South Wales and should be operational by the end of June.
(source: Reuters)
