MELBOURNE, Australia--Origin Energy Ltd. (ORG.AU) flagged growth in Australia's energy markets and its natural-gas operations after it was pitched to a widened loss for the last financial year by a raft of fresh impairment charges.
The integrated energy producer and retailer, which continues to withhold dividend payments as it focuses on strengthening its balance sheet, said it would continue to work to cut debt and improve efficiency so it can improve shareholder returns.
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Origin reported a net loss of 2.23 billion Australian dollars (US$1.74 billion) for the year through June, against a loss of A$628 million the year before.
Last week, the company warned investors to expect an additional almost A$1.2 billion in writedowns against its flagship gas export venture and with a cut in the proceeds its expects from the sale of assets. That came on top of the about A$1.9 billion in impairments booked in the first half of the year, mainly against the value of its investment in big APLNG venture on Australia's east coast.
Stripping out one-time items, underlying earnings were 51% higher at A$550 million, modestly below the A$555 million median of seven broker forecasts compiled by The Wall Street Journal.
The company's electricity business continued to perform well and the Australia Pacific LNG gas-export venture was performing strongly, said Frank Calabria, who took over as managing director and chief executive from Grant King last October.
"We have made good progress this year and we are now focused on continuing this momentum," Mr. Calabria said.
The company again said it won't pay a dividend for the latest half year, after suspending payouts in the second half of the 2016 financial year to focus on paying down debt built up with its investment in the almost A$25 billion APLNG liquefied natural gas project in Queensland state and other developments
In December, Origin said it would spin off and list unwanted conventional oil-and-gas operations to focus on energy markets and liquefied-natural-gas sales. With the sale of the operations, Origin said it expected net debt to fall to below A$7 billion by the end of the 2018 financial year after being cut by about A$1 billion over the last year.
"We are acutely aware of the importance of dividends to many of our shareholders and this decision was not taken lightly," Chairman Gordon Cairns said. "The board is of the view that the suspension of the dividend is in the best interests of all shareholders at this time."
Last month, Origin logged a more than doubling in sales revenue over the last financial year as production at the APLNG operation and from other assets jumped. APLNG is one of three liquefied natural gas plants built on Curtis Island in northeastern Queensland, and counts ConocoPhilips (COP) and China Petrochemical Corp. as partners.
On Wednesday, Origin said it expected underlying earnings before interest, tax, depreciation and amortization for its Energy Markets division would rise by between 14% and 21% in fiscal 2018 to A$1.7 billion-A$1.8 billion. It also forecast an increase of 7%-16% in natural-gas production.
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(END) Dow Jones Newswires
August 15, 2017 19:28 ET (23:28 GMT)