SYDNEY (AFX-ASIA) Ð Shares of Origin Energy have been trading higher against a weaker market in afternoon trade after the company raised its full-year earnings guidance to reflect a better-than-expected first half result, dealers said.

Origin said it has increased its full-year earnings growth target to 20% from the 10-15 pct forecast earlier, after net profit rose 64% to A$89.6 million in the first half to December. (US$1=A$1.7).

This was above the A$67.8 to $80.2 million range of market expectations, prompting the company to raise its full year earnings growth target to 20% from the 10-15% seen earlier.

The company declared an interim dividend of 5 cents.

Revenue rose 35% to A$1.67 billion.

“The increased profit for the half year has been driven by contributions from acquisitions, tariff increases and improved margins in energy retailing,” managing director Grant King said in a statement.

Retail EBITA rose 98% to A$133.8 million, with its investment in electricity retail through its purchase of retail assets Powercor and CitiPower showing immediate results, contributing more than 50% of total operating earnings.

Generation EBITA was A$19.5 million, with the Quarantine power Station, higher availability from the Ladbroke Grove power station and higher electricity pool prices all contributing to a stronger result.

“Improvements in these businesses more than offset the reduced contribution from Exploration and Production reflecting increased provisions and lower oil production,” said Mr King.

For the full year, a full six month contribution from the Mt Stuart Power Station will boost Generation results while increased oil output from the Hovea and Jingemia fields should lift Exploration and Production earnings.

“However, the underlying seasonality in energy retailing, the Victorian government’s rejection of gas and electricity tariff increases and higher electricity purchasing costs in the second half of the financial year will see a lower second half contribution from energy retailing.

“Notwithstanding these factors, based on the performance over the last half year we expect earnings for the full year to be higher than previously advised and are now likely to exceed last year’s profit by around 20%,” he said.

In the longer term, Origin expects new projects to deliver continued growth including the SEAGas pipeline which will begin gas deliveries to Adelaide later this year and the BassGas construction which has commenced and will deliver gas to the Victorian market in the second half of 2004.