AGL Energy has lifted its full year profit 52 per cent and announced a $1.2 billion capital raising to help fund its takeover of NSW power provider Macquarie Generation.
The energy provider made a net profit of $570 million for the year to June 30, up from $375 million in the previous year, though that result was weighed down by one-off costs.
Underlying rofit, which excludes the impact of one-offs, was down 3.9 per cent to $562 million.
AGL also announced a $1.2 billion renouncable entitlement offer to shareholders to fund its acquisition of MacGen.
Chief executive Michael Fraser said the $1.5 billion purchase of MacGen, which own the Bayswater and Liddell power stations and produces accounts for around a quarter of NSW’s energy production, was a good deal for shareholders.
“We think buying MacGen at the price of $1.5 billion really does represent compelling value for the lowest cost generation assets in New South Wales,” he told AAP.
AGL expects MacGen to add around $75 million to its full year profit in 2014/15
But it expects to take a $200 million hit to its earnings due to the abolition of the carbon tax and associated support payments and the closure its Kurnell LPG extraction plant, which is a result of the closure of Caltex’s oil refinery.
The abolition of the tax hurts the values of the company’s renewable energy assets and means AGL won’t receive $100 million in transitional assistance payments linked to its Loy Yang power station in Victoria.
However, Fraser said the end of the tax would ultimately lift the value of Loy Yang.
But he said the biggest beneficiaries would be consumers, with power prices set to fall around eight or nine per cent on average following the wake of
“It’s good news for consumers … prices will be coming off,” he said.
The company announced a fully franked final dividend of 33 cents per share, taking the full year dividend to 63 cents, the same as last year.
AGL shares have been placed in a trading halt while it carries out the capital raising.
In other financial results posted today, Wesfarmers will give an extra $1.1 billion back to shareholders after lifting its full year profit 19 per cent.
The Coles owner made a net profit of $2.69 billion in the year to June 30, up from $2.26 billion in the previous year.
Earnings from Coles supermarkets were up nine per cent to $1.67 billion.
Wesfarmers expects further growth from its retail businesses in 2014/15, though Target will continue to face challenges.
“Coles, Bunnings, Officeworks and Kmart all have good momentum as they lead into the 2015 financial year, while Target is expected to undergo significant change and improve as it progresses its transformation plan,” the company said.
It will return $1.1 billion to shareholders through payments of $1 per share, though the distribution is contingent on a ruling from the Australian Taxation Office (ATO).
The payment will come on top of Wesfarmers’ final dividend of $1.05 per share, and a special dividend of ten cents per share, which takes its full year dividends to $2 per share.
Coca Cola Amatil warned that post-budget weak consumer sentiment is set to mean tough trading conditions for the rest of the year after a 16 per cent slump in first half profit.
The beverage company’s net profit of $182.3 million was down from $216 million in 2013.
It announced 20 cents a share dividend, 75 per cent franked, down from 24 cents.
Discount retailer The Reject Shop has had a bumpy start to the fiscal year after its profit fell by a quarter in 2013/14.
The company made a $14.5 million profit in the year to June 30, down from $19.5 million the previous year.
Chairman Bill Stevens said same store sales, which strips out the effects of newly opened or closed outlets, had dropped in the first six weeks of fiscal 2015.
“The company has had a challenging start to FY2015 with the first weeks of the year yielding negative comparable store sales,” he said.
Woodside Petroleum has increased half-year net profit by 27 per cent and says it is confident about gas demand despite a large number of new projects coming online.
Woodside’s net profit for the six months to June 30 was $1.1 billion.
The largest company in Australia dedicated only to oil and gas production said the result was driven by higher prices, sales volumes and lower exploration and evaluation expenses.
