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Pacific Energy Limited increases annual revenue to $68.1 million

The acquisition of Contract Power Group and NovaPower attracted one-off costs related to its acquisition that dragged down the final profit.
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Pacific Energy is based in Western Australia

Pacific Energy Limited (ASX:PEA) has increased its annual revenues by $4.9 million or 19% to $68.1 million.

The energy company’s annual profit attributable to operations declined 60% to $6.8 million during the 2017-18 financial year.

Western Australia-based Pacific Energy’s underlying earnings before interest, tax, depreciation and amortisation (EBITDA) was up 10% to $44.1 million, while its reported EBITDA was down 23% to $31.3 million.

An ‘exciting year’

Pacific Energy managing director Mr Jamie Cullen said 2018 was an exciting year for the company as it increased its presence and capabilities through both organic growth and acquisition activity.

“With the work that has been completed over the 2018 financial year we have built an expanded and diversified portfolio incorporating long-term power generation activities.”

The company reported its results were at the top end of guidance.

Acquisition costs one-off

Pacific Energy said: “The acquisitions of both Contract Power Group and NovaPower have been fully settled and integrated, with the only outstanding financial liability being stamp duty on the Contract Power acquisition, for which the company has accrued $3.5 million.”

“The increased underlying revenue and profit results represent record levels for the company, with growth generated primarily from completing construction on a number of new projects and expansions, as well as benefiting from a full year’s contributions from investments in new capacity commissioned part way through last year.”

The company attributed the variation in EBITDA results to acquisition and impairment-related one-off costs.

Acquisition and due diligence costs came in at $4.8 million while impairment expenses were $9.8 million.

Contract Power meanwhile improved the final EBITDA result by $1.7 million.

Guidance set at $54-55 million

Pacific Energy underlying net profit after tax was up 14% to $18.3 million while its underlying earnings per share was similarly up 12% to 4.86 cents.

The earnings per share was an 8.7% share of today’s 56-cent closing price.

The company’s guidance for underlying 2018-19 financial year EBITDA is $54‐55 million.

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