The Origin Energy Ltd (ASX: ORG) share price is slipping today after the company reported its production and volume numbers for the quarter ending June 30, 2024.
At the time of writing, Origin Energy shares are trading at $10.46 apiece, down 1.37% from yesterday's close. In contrast, the S&P/ASX 200 Index (ASX: XJO) is currently in the green, up more than 1.3%.
Let's take a look at the energy giant's quarterly numbers.
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Origin Energy share price down on mixed volumes
- Australia Pacific LNG revenue increased by 2% from the previous quarter to $2.6 billion.
- FY24 electricity sales volumes were flat, but gas volumes declined by 10% year over year due to lower short-term wholesale gas sales.
- FY24 full-year revenue was down 12% compared to FY23, primarily due to lower commodity prices.
- Quarterly gas production in the three months ending June 30 was flat compared to the previous quarter.
- The June quarter realised average LNG price was US$11.70/MMBtu, with the average domestic price at $9.30 per gigajoule (GJ).
- Origin received cash distributions of $1.37 billion from Australia Pacific LNG during the 12 months ended June 30.
What else happened in Q4 FY24?
The Origin Energy share price had a strong quarter. The company executed on several ventures related to its energy markets during the period.
For one, the company signed an agreement with the NSW Government to delay the retirement of its Eraring Power Station until August 2027.
It also acquired a 20% interest in Climatech Zero, a business that provides energy solutions to industrial companies.
Origin also approved the second stage of the Eraring battery project, committing $450 million to add a 240 MW / 1030 MWh battery to the site. It has already begun construction of the first stage of the project.
Additionally, Origin executed an offtake agreement for stage two of the Supernode battery in Queensland.
The downside from the quarter was that shipped gas volumes were down 10% compared to the prior corresponding period. The company said it had fewer wholesale gas sales, which drove this result.
Following a strong period, the Origin Energy share price began to reverse course in July. It is now down more than 5% in the past month.
What did management say?
CEO Frank Calabria said he was pleased with Origin's ability to meet short-term demand in the market.
Australia Pacific LNG continued to perform strongly, delivering an uplift in production for the financial year, which supported higher sales volumes.
Strong field performance also supported Australia Pacific LNG to deliver more gas to the domestic market over the last quarter to help meet higher seasonal short-term demand.
Calabria also highlighted the strong performance of Origin's generation fleet and the expansion of storage projects, including the Eraring and Mortlake battery projects. He expressed confidence in the growth prospects of Octopus Energy and its Kraken platform.
In Energy Markets, Origin's generation fleet performed strongly during the year, with high levels of reliability.
Output from Eraring rose by 2.1 TWh to 14.3 TWh, supporting policy aiming to increase generation to help put downwards pressure on electricity prices, while the gas peaking fleet increased output and continued to play an important role supporting the grid and maintaining reliable supply for customers.
What's next for Origin Energy?
Looking ahead, Origin Energy says it plans to continue expanding its storage capabilities and positioning for the transitioning energy market.
Calabria noted the company was expanding the storage of its portfolio, having committed to 1.5GW of "owned and tolled battery projects".
This is important, because the Origin Energy share price is sensitive to movements in the price of energy.
Origin also aims to leverage Octopus Energy's growth potential. It noted that two investors upped their stake in Octopus during the quarter, increasing its valuation by 15%. It "holds strong conviction" in the company's growth.
Origin Energy share price snapshot
Over the past 12 months, the Origin Energy share price has gained 21%, outpacing the ASX 200 index by 13.5%.
Analysts at UBS rate the stock a buy with a $12.10 price target.
