Origin Energy still expects an increase in full year earnings and lower debt as it ramps up LNG production and oil prices improve.
Australia's largest gas and power retailer said it is on track for an increase of between 45 and 60 per cent in underlying earnings in the 2016/17 financial year, and to have reduced its net debt to below $9 billion.
"As a result of the resilience of our Energy Markets business and the optimistic outlook for our Integrated Gas business, we are comfortable to reconfirm previous guidance," Chairman Gordon Cairns told shareholders at the company's annual general meeting.
The company's underlying earnings totalled $1.64 billion in 2015/16, and it made a loss of $589 million as weak oil prices and a heavy debt burden from its Australia Pacific LNG development weighed for a second year in a row.
Origin has been hit hard by a slide in oil prices, which came towards the completion of its $26 billion APLNG project in Queensland, stretching the company's finances.
It was forced to raise $2.5 billion through an equity raising, cut about 2,500 jobs, slash capital expenditure and pledge to sell non-core assets worth $800 million in an effort to shore up its balance sheet.
Origin now expects its expanding LNG business to drive earnings growth. Increasing shipments from APLNG will help to more than double underlying earnings for the company's integrated gas business to over $1 billion this financial year, Mr Cairns said.
Origin also expects to increase underlying earnings in its energy markets business, which includes its retail operations, by $100 million to $200 million this financial year, on the back of cost reductions, he added.
The company has now put in place hedging contracts for about 15 million barrels of oil that will extend into the 2018 financial year.
"I don't think there will be a steady upper trend in oil prices. I think it will be volatile. And it is for those periods of volatility that the company has protected itself against through the hedge," Origin's outgoing managing director Grant King told reporters after the meeting.
The company avoided a first 'strike' against its executive pay, with 95 per cent of votes in favour of the resolution.
Frank Calabria, the head of Origin's energy markets business, will replace Mr King as managing director and CEO.
Origin shares dropped five cents to $5.62.
