The APA Group (ASX: APA) share price is in the green in early trade on Monday after the company released its first-half FY25 results.
Shares in the energy infrastructure company are currently fetching $6.82 apiece, 3.18% higher as investors process the company's numbers.
Let's see what the company posted in its first-half earnings.
APA share price sees green on H1 FY25 results
APA had a decent period of growth in the first half, with the following key takeouts:
- Revenue increased by 7.1% year over year to $1.36 billion.
- Underlying pre-tax profit increased 9.1% to $1. 02 billion.
- Free cash flow (FCF) grew by 3.6% to $552 million.
- Declared a distribution of 27 cents per share, up 2% from H1 FY24.
- Net profit declined to $34 million, down from $1.05 billion this time last year, due to the previous year's acquisition of the Pilbara Energy business.
What else happened in FY25?
The APA share price had a difficult time last year. But it wasn't such a difficult period for the underlying business.
Revenues were up 7%, driving a 9% growth in pre-tax earnings just north of $1 billion.
This was underscored by "strong contributions from new assets", along with "favourable recontracting", and a more efficient cost base.
Meanwhile, APA said it has completed the construction of the Port Hedland Solar and Battery project and the Kurri Kurri lateral pipeline project.
Pre-tax income in its East Coast gas transmission and storage division was up nearly 8%, helped by insurance proceeds received for "lost revenue following customer plant shutdowns in February 2023."
West Coast gas transmission and storage, on the other hand, was up 11% year over year to $183 million.
What did management say?
APA CEO Adam Watson said the company had put up a "strong" performance in the first half.
APA has delivered a strong financial and operating result for the half with growth in revenue, earnings, free cash flow and distribution.
Today's result demonstrates the strength of our underlying business, our continued focus on operational excellence and asset reliability, and our work to drive further cost optimisation, which is designed to increase free cash flow, support growth projects and ensure we can continue to deliver for investors.
At the same time, our operating cash flow and strong balance sheet provide the capacity to fund our $1.8 billion organic growth pipeline internally over the next three years. The result highlights the successful integration of the Pilbara business, with these new assets delivering $66 million in earnings for the half.
Our growth pipeline in the Pilbara also continued to progress. Construction of the Port Hedland Solar and Battery Project was completed in December and we were awarded Priority Project status for two electricity transmission projects.
What's next?
Management projects pre-tax earnings of $1.96 billion to $2 billion for its FY25 full-year results, reaffirming previous estimates.
It also reaffirmed its FY25 distribution guidance of 57 cents per security, a nearly 2% increase on FY24.
Work will also continue on the Sturt Plateau Pipeline and East Coast Gas Grid expansion. APA's growth pipeline over the next three years is expected to total $1.8 billion.
APA share price snapshot
The APA share price opened in the green today after the company posted its H1 FY25 results
Zooming out, the stock is down by around 14% in the past year.
