AGL Energy (AGL) investor relations material

Executive summary

• Underlying EBITDA was flat at $1,092 million, while underlying net profit after tax declined 6% to $353 million, reflecting lower electricity margins and higher costs, partially offset by customer growth and cost optimization.

• Statutory profit after tax was $94 million, impacted by negative fair value movements in financial instruments and significant items, including Retail Transformation costs and onerous contract provisions.

• Interim fully franked dividend of 24 cents per share declared, up from 23 cents, with a payout ratio targeted at 50–75% of annual underlying net profit after tax.

• Customer services increased to 4.7 million, up 108,000, with customer satisfaction rising to 83.8 and a healthy churn spread.

• Strategic partnership announced with Aussie Broadband, divesting the telecommunications business for $115 million in ABB shares, and agreement to divest 19.9% equity in Tilt Renewables for $750 million to support flexible capacity investments.

Financial highlights

• Revenue was $7,044 million, down 0.9% year-over-year, with gross margin at $1,969 million, down 1.6% year-over-year.

• Operating free cash flow increased to $314 million, and underlying cash from operating activities (before significant items, interest, and tax) was $836 million.

• EBITDA to operating cash flow conversion rate (excluding certain items) increased to 93%.

• Net debt increased to $3,249 million, mainly due to growth investments and dividend payments, with a gearing ratio of 38.5%.

• Battery portfolio contributed $35 million EBITDA, up $10 million from the prior half.

Outlook and guidance

• FY26 underlying EBITDA guidance narrowed to $2,020–$2,180 million and underlying NPAT to $580–$680 million, reflecting strong first-half performance and improved cost management.

• Full-year operating costs expected to be lower than previously indicated, with depreciation forecast revised down by $40 million.

• Targeting $50 million in sustainable net operating cost reductions in FY27.

• Earnings expected to remain skewed to the first half due to seasonality and contract roll-offs.

• Focus remains on customer growth, operational efficiency, and investment in renewables and storage.