Australia's AGL Energy H1 profit up, keeps forecast

AGL said it was on track to meet its full-year underlying profit forecast of between A$370-A$400 million ($239-$259 million) issued in December, compared with an earlier forecast of A$360-A$390 million.

Net profit before one-off items was A$192.5 million in the six months ended Dec. 31, compared with A$182.8 million a year ago, AGL said in a statement.

Reported net profit, which includes one-off items, was A$1.66 billion, boosted by divestments of its non-core assets which reaped a post tax profit of A$1.5 billion.

AGL said its earnings had been largely boosted by strong performance in its merchant energy business, which saw earnings for wholesale power rise 35 percent to A$211.9 million, while higher winter gas sales and gas prices lifted its retail business.

Chief Executive Michael Fraser said the firm will continue to expand its renewable energy portfolio, increase its gas reserves and develop its portfolio of gas generating power stations.

AGL has in recent months been aggressively boosting its stakes in coal seam gas fields, in a bid to boost its gas reserves to reduce its purchases of gas on the wholesale market amid expectations of strong price increases in the future.

The firm, which has also been building new power stations to reduce purchases on the wholesale electricity market, has also been investing in wind farms ahead of a government's policy to launch carbon emissions trading in mid-2010.

AGL, which has boosted its balance sheet with asset sales totalling A$3.2 billion over the past year, declared an interim dividend of 26 cents. ($1=1.544 Australian Dollar) (Reporting by Fayen Wong, Editing by Jonathan Standing)