Origin Energy (ORG) H1 2026 earnings summary

Executive summary

• Statutory profit for HY26 was $557 million, down 45% year-over-year; underlying profit was $593 million, down 36%, and underlying EBITDA fell 17% to $1,589 million, mainly due to lower Integrated Gas and Octopus Energy earnings, partially offset by higher Energy Markets performance.

• Energy Markets EBITDA rose to $860 million, exceeding expectations due to strong operational performance and cost reductions.

• Customer accounts increased by 96,000, with growth across electricity, gas, and internet segments, and cost to serve reduced by $32 million.

• Octopus Energy reported an EBITDA loss of $89 million, reflecting seasonality, regulatory costs, and ongoing investment in customer growth; Kraken platform contracted accounts reached 90 million.

• Major overhaul and extension of Eraring Power Station operations to April 2029 announced, with Stage 1 battery online and Stage 2 expansion committed.

Financial highlights

• Revenue for HY26 was $7,993 million, down from $8,771 million in HY25.

• Adjusted free cash flow increased to $705 million from $518 million in HY25.

• Adjusted net debt/EBITDA at 2.0x, at the bottom of the 2-3x target range.

• Interim dividend of 30cps, fully franked, maintained, with a 5.3% yield before franking.

• Dividend payout policy targets a minimum of 50% of adjusted free cash flow.

Outlook and guidance

• FY26 Energy Markets EBITDA guidance raised to $1,550–$1,750 million, reflecting improved electricity performance.

• Integrated Gas production guidance for FY26 updated to 645–680 PJ (APLNG 100%), with cash distributions to Origin expected at $700–950 million.

• Total FY26 capex expected at $900–$1,100 million, mainly for battery projects and Eraring battery expansion.

• Octopus Energy EBITDA guidance unchanged at $0–150 million, with continued investment in growth and technology.

• Battery earnings and lower coal costs expected to be tailwinds in FY27, partly offset by weaker wholesale prices.