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Reporting Season 19th August 2022

AGL Energy’s profits slide 58% following challenging market conditions | AGL Energy (ASX:AGL)

Australian electricity and gas company AGL Energy (ASX:AGL) released its FY22 results this morning.

Unprecedented market volatility, spiking wholesale prices and power plant outages hit AGL Energy’s profit in FY22, with the company’s underlying profit after tax sliding 58% for the year.

Underlying EBITDA also fell 21%, total customers remained broadly flat at 4.2 million and a final dividend of 10 cents per share was declared, taking the total dividends for FY22 to 26 cents per share for the year which just beat market expectations.

With a key focus on cost discipline during FY22, AGL Energy was able to reduce operating costs by more than $150 million in FY22.

Following the company’s decision to withdraw its proposed demerger to separate AGL Energy into AGL Australia and Accel Energy, AGL also announced a review of strategic direction.

AGL believes FY23 earnings will remain resilient amidst the current challenging energy industry and market conditions, however failed to provide FY23 guidance but said it will release guidance for the year ahead sometime in September.

Investors have responded negatively in the first half-hour of trade, with shares in the electricity and gas company trading just over 2% lower.