31 March 2015

Half Year Report to Shareholders 2015

Half Year Report to Shareholders for the half year ended 31 December 2014.

Half year report to Shareholders (6 pages)

Message from the Chairman and Managing Director

For the half year ended 31 December 2014, Origin reported a Statutory Loss of $25 million reflecting the non-cash impact of the recent depreciation of the Australian dollar on the fair value of financial instruments and debt, and interest expense.

Underlying Profit1 of $346 million decreased 9 per cent on the prior corresponding period. Underlying EBITDA1 was stable at $1.08 billion, reflecting a higher contribution from Energy Markets, partly off set by a lower contribution from Exploration & Production.

Australia Pacific LNG remains on track for sustained LNG production from Train 1 from the first quarter of the 2016 financial year.

Directors are mindful that during this fi nal phase of investment in Australia Pacific LNG, the recent significant fall in oil price, if sustained at current levels, will result in lower growth in cash flow and earnings than previously expected. Therefore, we continue to ensure capital expenditure is focused on projects that will enhance cash flow and that operating costs are tightly controlled.

At current market expectations of oil prices, the economics of Origin’s investment in Australia Pacific LNG remains robust2.

Dividend

The Board has determined to pay an unfranked interim dividend of 25 cents per share, paid to shareholders on 31 March 2015. It is still the Board’s intention to maintain dividends at the greater of 50 cents per share, on an annual basis, or a minimum 60 per cent payout ratio, as earnings grow following completion of Origin’s investment in Australia Pacific LNG.

Prospects

Looking ahead, and notwithstanding the significant reduction in oil prices, Origin expects an increased contribution from its natural gas business, and a substantial increase in earnings and cash flow from the Australia Pacific LNG project. We look forward to your continued support of Origin.

Gordon Cairns
Chairman
Grant King
Managing Director
  1. Refer to Glossary.
  2. Consistent with forward prices stepping up to US$85 / bbl (real 2014) from the 2018 financial year.