Investors continued to sell out of Babcock & Brown Power Ltd, driving its share price down a further 14 per cent today after the fund downgraded the earnings of its Alinta gas subsidiary.
Shares in the listed fund closed down 10c to 62c today, after falling 20 per cent or 18c yesterday on news of the earnings downgrade and scrapping plans to pay a second half dividend this year.
BBP said yesterday that it would focus on ways to strengthen its balance sheet and lower its gearing, and threw out plans to issue a 13-18c dividend.
The company has a debt facility of about $360 million that is due to be refinanced by the end of August.
Meanwhile the company downgraded earnings for Alinta in light of the Varanus Island incident which has cut the state's gas supply by a third. Around 30 per cent of Alinta's portfolio of gas is supplied by the facility.
BBP sees its fiscal 2008 earnings before interest, tax, depreciation and amortisation (EBITDA) in a $330 million to $340 million range.
Earnings in the new year are projected at at the lower end of the range of analysts forecasts of $439 million and $528 million.
BBP is going forward with an asset sale program, but it does not include Alinta.
