2 Divisional  Highlights Upstream Gas Merchant Energy Retail Energy >Operating EBIT increased  by 17% on the back of  improved margins > Further improvements in  operating efficiency, with  net operating costs as a  percentage of gross margin  falling from 49.5% to 46.5% > Customer accounts increased  by 52,000 and dual fuel  customer accounts up 8.1%  to 1.47 million > The AGL Hallett 4 Wind Farm  was commissioned, and  construction proceeded on the  AGL Hallett 5, Oaklands Hill  and Macarthur Wind Farms > Improved rainfall increased  dam storage and generation  capacity at Eildon and  Dartmouth > Operating EBIT fell by 2%,  due mainly to the effects of  the severe weather events  experienced in late January/ early February > Mosaic Oil was acquired  during the year, adding 65 PJ  to gas reserves and opening  up new gas storage income  opportunities > Proved plus probable (2P)  gas reserves increased 32.4%  to 2,089 PJ > First booking of gas reserves  in AGL’s Hunter Gas Project AGL’s Retail Energy business continued to  perform strongly, offsetting the effects  of unusually severe weather conditions on  Merchant Energy’s results, and a much lower  contribution from AGL’s investment in the  Loy Yang A Power Station. $373.0m Operating EBIT ($million) $378.2m Operating EBIT ($million) $13.6m Operating EBIT ($million) 266.8 318.7 373.0 2009 2010 2011 402.8 386.1 378.2 2009 2010 2011 4.1 1 5.5 13.6 2009 2010 2011 1 Excludes EBIT of $25.8m from assets sold in FY2009