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BPT

Beach Energy Limited FY19 Results

Jordan Baird

Jordan Baird is the head ASR Wealth Advisers client services desk and has been with the organisation since 2017. He first started investing in his early years. While he believes that investors should leave no stone unturned he has a particular interest in trading based on broad macroeconomic trends along with specific analysis of innovative up-and-coming companies.

Beach Energy Limited (ASX: BPT) is an oil and gas production and exploration company based in Australia.

beach energy

What are the results from Beach Energy FY19?

Today (Thursday 19th of August 2019) Beach Energy released its FY19 annual results. The main points are as follows:

  • Sales Revenue for FY19 is A$1,925 million, up by 54% from FY18
  • Underlying EBITDA for FY19 is A$1,375 million, up 80% from FY18
  • Underlying NPAT for FY19 is A$560 million, up 86% compared with reported FY18 NPAT.
  • The final dividend is 1 cent per share (fully franked), no change from FY18
  • Operating Cash Flow for FY19 is A$1,038 million, up 57% from FY18

Specific results on company operations are as follows:

  • Oil Production rose to 29.4 MMboe, up55% from FY18
  • Produced an 85% drilling success rate in Beach-operated wells
  • 204% organic 2P reserves replacement, 2P reserves life increased to greater than 12 years

 

What were the drivers of this result?

Major drivers of this result include a 55% increase in sales volumes as well as a greater Australian dollar oil and gas price than originally forecasted. The 55% increase in oil production allowed Beach Energy to better capitalise on ROCE, which increased by 8% from FY18.

Another major driver is the execution of all goals and promises set out by the company in FY18. Most goals set for FY19 were reached and surpassed, which drove such a strong financial result and position.

 

What is the outlook for Beach Energy?

The outlook is positive for Beach Energy, with 194 wells targeted for FY20 with specific focus on Otway and Cooper basin, a 45% increase from FY19. Accelerated investment is forecasted to bring 90% of growth projects to FY20 and thus bring the internal rate of returns to be greater than 50%.

Beach Energy intends to increase oil production to 29MMboe in FY20 from 27 in FY19, which if managed well with costs, will bring further gains.

Increased investment is expected to total A$750-A$850 million for FY20.

5-year goals have been set including further increases in MMboe, increases in free cash flow and further investment opportunities have been identified and look to be capitalised on within 5 years.

 

What is the market reaction?

The initial market reaction to Beach Energy FY19 results is Positive. The current share price is trading at A$1.92 which represents a 6.09% increase (10:51 am AEST).

 


 

Disclaimer:

This article has been prepared by the Australian Stock Report Pty Ltd (AFSL: 301 682. ABN: 94 106 863 978) (“ASR”). ASR is part of Amalgamated Australian Investment Group Limited (AAIG) (ABN: 81 140 208 288 Level 13, 130 Pitt Street, Sydney NSW 2000).

This article is provided for informational purpose only and does not purport to contain all matters relevant to any particular investment or financial instrument. Any market commentary in this communication is not intended to constitute “research” as defined by applicable regulations. Whilst information published on or accessed via this website is believed to be reliable, as far as permitted by law we make no representations as to its ongoing availability, accuracy or completeness. Any quotes or prices used herein are current at the time of preparation. This document and its contents are proprietary information and products of our firm and may not be reproduced or otherwise disseminated in whole or in part without our written consent unless required to by judicial or administrative proceeding. The ultimate decision to proceed with any transaction rests solely with you. We are not acting as your advisor in relation to any information contained herein. Any projections are estimates only and may not be realised in the future.

ASR has no position in any of the stocks mentioned.

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