Origin Energy's December half net profit slumped to $524 million from $794 million, hit by a series of charges amid what it termed "challenging operating conditions" in its key markets, which prompted it to cut its full year profit guidance.
The underlying profit dropped to $362 million from $489 million, falling well short of analyst expectations of a profit of around $400 million for the half.
Shares were down 7.9 per cent to $11.40 in early trade.
In its key energy markets division, earnings slid 20 per cent as it suffered a 'loss of volume in the mass market", it said.
During the half, Origin cut 500 jobs with a further 350 jobs to go by the end of 2013, it said, as it lifts its focus on costs.
Costs at its critical Queensland export gas project have risen 7 per cent, it said.
In light of the pressures it is facing, Origin now said it expects its full year underlying profit to drop by 10-15 per cent, up from the 5-10 per cent fall flagged earlier.
Morningstar analyst Gareth James described Origin's first half performance as "disappointing''.
"The key driver of the profit fall was the core electricity retailing energy markets business which suffered falls in customers, electricity volumes and profit margins. Prior to the result, our forecast was $809 million with consensus estimates at $830 million.
"A 7 per cent capital cost increase for the Australia Pacific Liquid Natural Gas project to $24.7 billion is disappointing and unexpected. We expect to downgrade both our fiscal 2013 net profit forecast and our fair value estimate is likely to be impacted by the APLNG cost blowout.
"We estimate the fair value reduction could be in the region of 5 -10 per cent.
"Origin claims to have sufficient funding for APLNG capital expenditure requirements and reiterated it will not undertake an equity raising.”