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Santos 2014 full-year underlying profit up 6 percent to $533 million

Net loss of $935 million, reflecting previously advised non-cash after tax impairments of $1,563 million

Full-year highlights
  • Production up 6% to 54.1 mmboe
  • Sales revenue up 12% to $4 billion
  • EBITDAX up 8% to $2,153 million
  • Operating cash flow up 13% to $1,843 million
  • PNG LNG start-up ahead of schedule with the project shipping 55 LNG cargoes in the year
  • GLNG more than 90% complete and on track for first LNG in the second half of 2015, within budget
  • Final dividend maintained at 15 cents per share, bringing the full-year dividend to 35 cents per share, up 5 cents

Santos today announced a 2014 underlying net profit of $533 million, up 6 per cent on the previous year.

After the previously advised non-cash after tax impairments of $1,563 million, the financial result for the year was a net loss of $935 million.

Commenting on the results, Managing Director and Chief Executive Officer David Knox said that despite the reported loss, Santos made significant progress in 2014.

“Our results today reflect the many achievements of the company in 2014, highlighted by the start-up of PNG LNG ahead of schedule and the commencement of commissioning the GLNG project,” Mr Knox said.

“Santos also delivered its highest production in five years, record sales revenue and strong operating cash flow.

“The underlying performance of our business remains strong and we look forward to further production growth in 2015 with the start-up of GLNG in the second half of this year, within the US$18.5 billion budget.

“The bottom line result nevertheless reflects the impact of the unexpectedly sharp down-turn in oil prices towards the end of the second half in particular which saw us recognise significant non-cash asset impairments announced earlier this month.

“We will continue to proactively manage our costs, both capital and operating, in line with the current market environment. Capital expenditure in 2015 is forecast at $2 billion, 44% lower than 2014, and we expect to reduce production costs per barrel by 10%. Costs will be tightly managed as we work through the current oil price environment,” Mr Knox said.

Santos retains a robust funding position with approximately $2.9 billion in cash and undrawn debt facilities available at the end of 2014.

The final dividend has been maintained at 15 cents per share fully franked. This brings the full-year 2014 dividend to 35 cents per share, up 5 cents on the prior year. The dividend reinvestment plan (DRP) will be in effect for the final dividend and will be fully underwritten. DRP shares will be issued at a 1.5% discount.

All guidance for 2015 is maintained.