Energy retailer AGL will look to sell off more than $1 billion worth of assets and cut costs by $200 million within two years.
AGL says it will divest underperforming assets and cut its working capital by the end of the 2016/17 financial year in an effort to boost earnings in a competitive energy market.
It also says its full year underlying profit for 2014/15 will likely be at in the top half of its $575 million to $635 million guidance range, up from $562 million last year.
AGL shares were up 67 cents, or four per cent, to $16.15 at the start of trading on Tuesday.
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In a statement to the stock exchange, the energy company says its “strategic roadmap” factors in long-term challenges include the need to reduce carbon emissions and new “decentralised technologies” such as domestic battery storage.
“In the long-term, energy markets will be transformed by new decentralised products and services, including solar PV, battery storage, connected appliances and smart grids,” the statement said.
It says AGL’s “New Energy” business had been established to embrace these changes.
“AGL intends to create one million ‘smart’ connection to consumers and businesses by 2020 by scaling to become one of the leading providers of metering services, rooftop solar, commercial energy services, energy storage and electric vehicle services.”
– with AAP
