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Investing.com-- Shares of Origin Energy Ltd (ASX:ORG) rose sharply on Thursday after the Australian power provider clocked a sharp increase in its annual underlying profit, helped by lower tax expenses and strong energy demand.
Origin rose 7.3% to A$12.70 in morning trade, underpinning a 0.6% rise in the ASX 200.
The company’s underlying profit for the year to June 30 rose 26% to A$1.49 billion ($974.76 million), also beating Reuters estimates of A$1.46 billion.
The company declared a final dividend of 30 cents a share, higher than the 27.5 cents declared last year.
Origin’s stronger profit was driven in part by lower income tax expenses, after the dividends from Australia Pacific LNG– which it owns and operates with ConocoPhillips and China’s Sinopec– switched to fully franked from partially franked.
Franking entails lower taxes on the dividend received, given that the payment is made after being taxed at a corporate level.
APLNG was also a strong driver of Origin’s integrated gas division earnings, as energy demand picked up. But earnings from its energy markets division fell due to lower electricity prices, as Canberra introduced electricity subsidies to help curb the cost of living.
Origin forecast APLNG production of 635 to 680 petajoules for fiscal 2026.