NGC comes in from the cold with $16m profit

By CHRIS DANIELS

Natural Gas Corporation has returned to profitability less than a year after it emerged, bruised and battered, from an ill-fated foray into electricity retailing.

Announcing a net profit of $16.1 million for the six months to December 31, Natural Gas Corporation chief executive Phil James said all of the company's business units had performed with distinction, with increased sales in natural gas, gas liquids and electricity generation.

More gas was also transported along its network in the last six months of last year.

The latest profits were achieved from total operating revenues of $406 million, down from $635 million a year earlier.

In a curious twist of fortune, the same factors that forced NGC's ignominious exit from electricity retailing, namely a cold and dry winter, were behind the latest good profit results.

The lack of water in the hydro storage lakes allowed those generators with thermal power stations, primarily Contact, to generate large amounts of power.

For this they needed gas, which they bought from NGC.

The corporation enjoyed a jump in gas sales of 22 per cent, two-thirds of which was the result of increased demand from electricity generators.

Last August, NGC announced a full-year loss of more than $300 million, money lost when it was forced to supply its customers with electricity bought on the soaring spot market.

It was forced to go to AGL - the Australian energy company that owns 66 per cent of NGC - to be bailed out.

All of the profit announced yesterday will be paid as an unimputed interim dividend of 3c a share, to be paid on March 25.

Last year's huge tax losses mean NGC shareholders may not get fully imputed dividends till late next year.