Meta Category: Energy

Key Highlights

  • Origin operates across Energy Markets, Integrated Gas and its Octopus Energy investment.
  • Energy Markets serves about 4.94 million customer accounts.
  • Origin is building battery capacity alongside its existing generation portfolio.
  • Its Octopus and Kraken interests add exposure to international energy retail and software.

Origin Energy is increasingly shaped by three connected areas: Australian electricity and gas markets, its interest in Australia Pacific LNG and its exposure to Octopus Energy and Kraken Technologies. Origin Energy (ASX:ORG) is developing these businesses while investing in batteries, customer services and digital energy platforms.

Business snapshot: three engines of earnings

Origin is an integrated energy company. It reports through three segments: Energy Markets, which covers electricity generation and retail electricity and gas sales in Australia; Integrated Gas, mainly its interest in Australia Pacific LNG (APLNG), a Queensland coal seam gas and LNG export venture; and its share of Octopus Energy.

Energy Markets serves about 4.94 million customer accounts and operates generation Assets including Eraring Power Station in New South Wales, which Origin announced in January 2026 it planned to keep operating until April 2029. The company is also building a battery portfolio, with 1.3 gigawatts of capacity and 4.1 gigawatt-hours of storage operational as of August 2026. On 3 September 2026, it marked a milestone at the 300 MW / 650 MWh Mortlake battery in Victoria.

How Octopus Energy shapes the story

Octopus Energy is one of the United Kingdom's largest energy retailers, and Origin holds a significant minority stake. The company reported that Octopus now has 19 million customer accounts, an increase of 2.2 million over the year.

The bigger strategic development is Kraken Technologies, the software platform originally built by Octopus to run its retail operations and now licensed to other energy companies. Origin said Kraken was formally separated from Octopus in July 2026, following a standalone Equity raise of US$1 billion at a look-through valuation of US$8.65 billion. Origin holds a 22.7% economic interest across both Octopus and Kraken and reported investing A$210 million. Kraken's contracted accounts grew 28% to 95 million, with Revenue up 19%.

In FY26, Origin's share of Octopus's underlying EBITDA was a loss of A$8 million, a sharp improvement from a loss of A$88 million in FY25. For FY27, Origin expects Kraken revenue growth above 20% and subscription gross margins above 70%, while Octopus targets UK EBITDA of £25 to £50 per customer. These are company targets, and their value to shareholders depends on execution and on how markets value the two businesses.

What the FY26 numbers show

Origin reports in Australian dollars, with a financial year ending 30 June. For FY26, statutory profit was A$1,574 million, up from A$1,481 million. Underlying profit, which strips out items such as Fair Value movements, fell to A$1,159 million from A$1,490 million, and underlying EBITDA declined to A$3,220 million from A$3,411 million.

The divisions moved in different directions. Energy Markets underlying EBITDA rose to A$1,701 million from A$1,404 million, helped by higher electricity Gross Profit and a lower cost to serve of A$642 million. Customer churn of 15.0% compared with a market average of 21.7%. Integrated Gas underlying EBITDA fell to A$1,620 million from A$2,202 million, reflecting lower realised LNG prices of A$13.64 per gigajoule. Origin still received A$911 million in dividends from APLNG.

Adjusted free Cash Flow rose by A$867 million to A$2,074 million, and adjusted net Debt to EBITDA was 1.6 times. Total FY26 dividends were 60 cents per share, fully franked.

For FY27, Origin guided to Energy Markets EBITDA of A$1,550 million to A$1,850 million, APLNG production of 625 to 670 petajoules on a 100% basis, and total Capital Expenditure of A$450 million to A$650 million, lower as the battery programme winds down.

Risks to Consider

Origin faces a data security incident disclosed in July 2026, which the company said involved unauthorised access to some customer data affecting around 900,000 customers. Regulatory scrutiny and remediation costs could follow. Energy Markets Earnings are exposed to wholesale electricity prices, government intervention and competition.

Integrated Gas depends on oil-linked LNG prices, production performance and currency. The value of the Octopus and Kraken stake depends on growth, profitability and any future transactions, and is not realised in cash unless assets are sold or dividends paid. Eraring's operating timetable and the energy transition also create policy and asset risks.

What to Watch Next

Origin's Annual General Meeting is scheduled for 14 October 2026, where shareholders may hear updates on trading, the data incident and Octopus. The final Dividend is payable on 2 October 2026. The next Quarterly Report will cover the September quarter, and the half-year result is forecast for 11 February 2027.

Investors may also watch LNG prices, APLNG production, Kraken's growth and any valuation events at Octopus or Kraken.