Second tier energy retailer Australian Power and Gas has reversed its earlier forecast of a year to June profit, and has now flagged another net loss of up to $5 million following a surge in bad debts and difficult wholesale electricity market conditions which squeezed margins.
Revenue for the full year will run at $478-488 million, up from $364.8 million a year earlier.In the year to June, 2012, the company lost $3.9 million, the latest in a string of losses since its launch.
Earlier this year, it forecast a year to June net profit of as much as $9 million, although this has now been downgraded due to lower than normal energy consumption by its customers, margin pressure due to intense market competition and higher provisioning for overdue debt.
In revising full year forecast, it said it expects a recovery in energy usage levels, along with a recovery in outstanding bad debts which will enable it to reverse bad debt provisions and no change to costs and margins in other areas of operations.
As a result, it has flagged the year ahead as a year of consolidation, as it seeks to put its operations onto a more sustained basis.
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