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Origin downgrades FY profit forecast

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February 21 2013, 11:36AM

Origin managing director Grant King said it planned to cut another 350 jobs in 2013, taking the total number for the year to 850.

"This will result in more focused operations and a lower cost base in the 2014 financial year," he said.

"We also continue to review our activities and close, discontinue or divest non-core assets, which will improve our available cash flow in the short to medium term."

Origin expects regulatory and market competitive pressures that affected its first half result for its energy markets division to continue for the remainder of the year.

However it expects a strong increase in the contribution of its exploration and production business for the full year, driven by higher levels of plant availability and production in the second half.

Origin has been hit by weakening demand in electricity use at a time when regulators in some states are cracking down on rising prices.

The company lost a Queensland Supreme Court battle last December over the state's electricity prize freeze.

Meanwhile, Origin expects its main driver for growth in the future will be its investment in the Australia Pacific LNG project, in which it is a 37.5 per cent stakeholder.

Origin on Thursday said it expected the project would be delivered on or ahead of schedule at a cost of $24.7 billion, with the company's investment expected to peak at $4.4 billion.

Origin had initially expected to contribute $3.6 billion to the project, which was originally estimated to cost $23 billion.

Origin's shares were $1.00, or eight per cent, lower at $11.39 at 1119 AEDT.