AGL Future Earnings, page-5

Credit Suisse updated its broker report today:

Retains underperform with its price target increasing marginally because a slight reduction in expected future capex.

Summary:
"1H21- NPAT in line with consensus, no change to revised FY21 guidance: 1H21
NPAT down 27%, in line with consensus, 6% below CS. FY21 NPAT guidance of A$500-
580mn unchanged, though AGL did provide new EBITDA guidance of A$1,585-1,845mn

Structural separation? Value of retail may be becoming more Independent, but
not Increasing: No undervaluation in our view: AGL stated that it was conducting a
review of business model and capital structure, with detail to be provided in late-March. It
noted that the “value of retail is becoming more independent of base-load generation.” In
our view there is no market mis-pricing; we carry Integrated Energy 1.4x impaired book
value, and Customer at 2x AGL’s value-per-customer acquisition multiple for Amaysim.
And, unfortunately the value is not increasing, with a 6% fall in Customer gross margin in
1H21; 16% for electricity attributed to increasing discounting. We would also contend that
with state governments and corporates replacing retailers as counterparties to renewables
developers, the attractiveness of a downstream position is diminished (not extinguished)."

Future Earnings Estimate:
FY21 EPS $0.87
FY22 EPS $0.64
FY23 EPS $0.52

So Credit Suisse also forecasting 3 years of declining earnings.