Origin Energy Shares Slide on Lower Earnings Outlook from Key Investments

Highlights:

• Origin Energy Limited (ASX: ORG) shares fell 4% after forecasting lower earnings from APLNG and Octopus Energy.
• Key investments impacted by market volatility and regulatory changes, especially in LNG and UK energy markets.
• Utilities sector underperforms on the ASX, driven by Origin’s sharp drop.

Earnings Guidance Weighs on Investor Sentiment

Origin Energy Limited (ASX: ORG) saw its share price fall by 4% after issuing an earnings update that disappointed investors. At the time of writing, the company reported that earnings from its stakes in Australia Pacific LNG (APLNG) and UK-based Octopus Energy are projected to come in below expectations, prompting a negative response from the market.

Key Investments Underperform

Origin flagged that returns from APLNG, a major liquefied natural gas export operation, would be impacted by lower commodity prices and operational factors. Meanwhile, its investment in Octopus Energy, a UK-based retail energy provider, is also expected to generate weaker earnings due to regulatory pressures and market volatility in Europe. These two assets are critical to Origin’s future growth strategy, and any underperformance raises concerns about the company’s earnings resilience.

Utilities Sector Under Pressure

The drop in Origin's share price contributed to broader weakness in the utilities sector, which underperformed on the ASX despite gains in other industries. Investors appear to be recalibrating expectations for energy providers amid changing regulatory environments and global market challenges.

Management Remains Optimistic

Despite the downgraded earnings guidance, Origin’s leadership reaffirmed confidence in the long-term potential of both APLNG and Octopus Energy. The company emphasised that these investments remain strategically valuable and are expected to deliver strong returns over time. Management also highlighted ongoing efforts to navigate market headwinds through operational efficiency and portfolio optimisation.

Market Awaits Further Clarity

At the time of writing, investors are looking ahead to the company’s next earnings report and any updates on strategic direction. A clearer roadmap for improving performance could help rebuild market confidence.

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