Learn To Invest
Stocks Special Reports LICs Credit Funds ETFs Tools SMSFs
Video Archive Article Archive
News Stocks Special Reports Funds ETFs Features SMSFs Learn


Orora flags $8m H2 hit from power bill

Simone Ziaziaris  |  14 Feb 2018Text size  Decrease  Increase  |  
Email to Friend

Page 1 of 1

SYDNEY - [AAP] Orora (ASX: ORA) has warned it expects its power bill to rise by as much as $8 million in each of the next two halves as the packaging business looks for alternate supplies amid surging east coast electricity prices.

Orora shares rose on Wednesday after it reported a lift in profits and revenue, but the group said it is still concerned about the impact of power prices on earnings at its NSW recycled paper mill.

"The Australian electricity market is expected to continue to be volatile for the foreseeable future and presents further potential downside risk," Orora said on Wednesday.

Orora said it has a number of initiatives in a bid to reduce energy consumption, including a new $23 million secondary water treatment plant--due to be completed by June--which will generate bio-gas to be converted into electricity and used on site.

The company has also signed a long-term power deal with renewable energy provider Pacific Hydro to supply wind generated electricity to its South Australia operations.

"Renewable energy represents a competitively priced and sustainable energy source for the business," Orora said.

"Contracting directly with Pacific Hydro, Orora will reduce the business's exposure to fluctuating prices of the wholesale energy market."

The company said it will continue to assess further energy efficiency projects and supply options.

Orora's Botany mill produced 204,000 tonnes of recycled paper during the first-half, compared to 186,000 a year ago, and was the primary driver in higher fibre earnings.

Orora lifted first-half profit 12.7 per cent to $103.8 million thanks to a boost from its core businesses and growth in earnings from recent acquisitions.

Net profit before the $1.9 million cost of restructuring its NSW fibre packaging business and decommissioning another site came in at $105.7 million, while revenue rose 6.2 per cent to $2.1 billion from $1.975 billion a year ago.

The company says its Australasia segment delivered an 11.1 per cent increase in earnings to $121.1 million, with sales revenue up five per cent to $1.04 billion.

Orora shares were up 10.5 cents, or 3.3 per cent, to $3.295 at 1500 AEDT.


* Profit up 12.7pc to $103.8m

* Revenue up 6.2pc to $2.1bn

* Partially franked interim dividend up 1.0 cent to 6.0 cents


AAP logo image

© [2017] Australian Associated Press Pty Limited (AAP) or its Licensors. This is the Morningstar service with content provided by AAP where indicated. AAP reserves all rights, including copyright, in services provided by it. The information in the service is for personal use only, does not constitute financial product advice (whether general or personal) and may not be re-written, copied, re-sold or re-distributed, framed, linked or otherwise used whether for compensation of any kind or not, without the prior written permission of AAP. You should seek advice from a professional financial adviser before making decision to acquire or dispose of a financial product.

This service is published for general information purposes only without assuming a duty of care. AAP is not in the business of providing financial product advice (whether personal or general advice), and gives no warranty, guarantee or other representation about the accuracy of the information or images contained in this service. AAP is not liable for errors, omissions in, delays or interruptions to or cessation of the services through negligence or otherwise. The globe symbol and "AAP" are registered trademarks.

Email To Friend