Essay on Agl Energy Limited

3166 Words Nov 3rd, 2010 13 Pages
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ACCT 1110 – Accounting for Corporations
tudent Name: Hui Daniel s3109770
Li Allen s3222285
Liu Nicole s3218667

Tutor Name: Dr. Mahesh Joshi
Lecture Time: Tuesday 9:30
Assignment Due: Monday 7th of September 2009

Executive Summary

The purpose of this document is to record the analysis of AGL Energy Limited’s the external environment, internal business activities, financial situation and some parts of the annual report such as PPE, intangible asset and Leased assets & liabilities.

There are two main parts of this document. The first part is the industry analysis, which is through Porters 5 Forces to
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E 1979).

For AGL the industry is fairly competitive, with the top 5 companies owning approximately 30% of the market share, being Origin Energy Limited, AGL Energy Limited, Energy Australia, Sydney Water Corporation, ENERGEX Limited and other with a respective market share of 12.6%, 8.3%, 4.7%, 2.6%, 2.1& and 69.7% respectively in the year 2008.

The largest direct competitor for AGL would be Origin Energy as listed above, with similar business structure which operates in a number of energy market sectors including exploration and production, retailing gas and electricity, power generation and the operation of gas networks.

2.1.3. Substitutes

The price elasticity of demand for the goods and services supplied by the Electricity, Gas and Water division is low, as the feature of this division reflects the fact that electricity, gas and water are regarded as essentials in both business and households.

2.1.4. Bargaining power of Customers

Customers hold the power to drive down prices, demand higher quality or more services, and play competitors off against each other (Porter M. E, 1979). Due to the fact that water, gas and electricity is a homogenous product with very little or no point of differentiation and that the…