Australia’s largest gas infrastructure business has posted solid results driven by continued investment and innovation.
APA’s earnings before interest, tax, depreciation and amortisation (EBITDA) was up 4.8 per cent to $1,330.5 million, while net profit after tax was down 67.9 per cent to $179.5 million.
Depreciation, amortisation and interest costs increased primarily as a result of the acquisition of the Wallumbilla Gladstone Pipeline in June 2015.
The significant increase in depreciation and amortisation of those fixed and intangible assets and the increase in interest on the debt raised as part of the funding of the acquisition all resulted in a decrease in profit after tax of 12 per cent to $179.5 million.
APA’s operating cash flow also increased 53.4 per cent to $862.4 million.
“The FY2016 results reflect our successful track-record of investment, and in the case of the East Coast Grid, investing to meet market demands so that our customers can realise their business plans,” said APA Group Managing Director Mick McCormack.
“Recent acquisitions, particularly the Wallumbilla Gladstone Pipeline, and expansion of our East Coast Grid services, have delivered and step-change in the scale, capacity and service offering of our business.”
Meanwhile, Mr McCormack has highlighted the company has “a lot of juice left in the tank” with the potential of buying into the United States (US) pipeline network, as well as $1.5 billion worth of deals in Australia.
“In the last two years or 18 months the US midstream market has basically crashed,” said Mr McCormack, explaining that the US shale boom meant companies overbuilt capacity.
“All we are saying is that we are going to have a look.
“APA has built a record over 16 years and we’re not going to crash it because we feel like going for a jaunt overseas and spending money.
“We might go for a look at the US and spend some time there and come back and think, no we’re not going to do it.”