SANTOS NET PROFIT $630 MLN

SANTOS - Santos reports record annual underlying profit of $727 million and record free cash flow of $1,006 million  

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Santos today announced its full-year results for 2018, reporting both record underlying profit and record free cash flow.

The Board has resolved to pay a final dividend of US6.2 cents per share fully-franked. This brings full-year dividends to US9.7 cents fully-franked per share.

Santos Managing Director and Chief Executive Officer Kevin Gallagher said: “Today’s announcement of full-year results demonstrates delivery of our strategy to drive sustainable shareholder value by establishing a low-cost, high-performance operating model that generates strong cash flows through the oil price cycle.”

“Santos has delivered strong financial results for 2018 with EBITDAX¹ up 51% to a record US$2.2 billion and free cash flow¹ up 63% to a record of more than US$1 billion. Underlying profit¹ after tax more than doubled to a record US$727 million. Santos is now on a firm path to grow production and reserves.”

Mr Gallagher said the recent completion of the acquisition of Quadrant Energy will provide a significant boost in Santos’ production in 2019, with the company targeting production of between 71 and 78 mmboe.

“The acquisition, combined with organic reserves additions, contributed to strong reserves growth in 2018 with 2P reserves increasing by 20% to over one billion barrels of oil equivalent. Contingent resources increased to 1.8 billion barrels.

“Consistent application of our disciplined operating model continued to deliver cost reductions and efficiencies, with underlying production costs² down 6% to US$7.62/boe and further reductions in well costs, confirming Santos as Australia’s lowest cost onshore operator.

“In the Cooper Basin, our focus on low-cost, efficient operations has contributed to 8% production growth in 2018, including our highest daily oil production rates since 2009. Drilling activity increased 40% over the course of the year to 85 wells and a fourth drilling rig was added.

“In line with our plans to grow the Cooper Basin, we successfully executed the Moomba South phase 1 appraisal drilling campaign, the first of several large scale project appraisal programs focused on delivering resource conversion to support future production growth.

“At GLNG, our low-cost, efficient operations continue to support a development plan to unlock more gas over time. In 2018, we drilled a record 305 wells, 77% higher than 2017. During the year the 480-well Roma East field development was sanctioned with 121 wells drilled by year-end and the Scotia CF1 field project delivered one year ahead of schedule and 16% under budget. The 148-well Arcadia Phase 1 development was also sanctioned during the year with the first wells due on-line in the first quarter of 2019.

“In Northern Australia, Darwin LNG remains an important and strategic infrastructure project for the future development of onshore and offshore resources. Plant performance in 2018 was again strong with LNG production higher than 2017.

“The Barossa project is being progressed as the lead candidate to backfill Darwin LNG with a final investment decision targeted by late 2019 or early 2020.

“In PNG, plant upgrades resulted in a record daily production rate equivalent to 9.2 mtpa being achieved in the second half of the year.

“PNG LNG expansion opportunities continue to be progressed with provisional results from the Muruk-2 appraisal well indicating the objective Toro reservoir is likely hydrocarbon bearing.”

“In September, we completed the sale of our non-core Asian assets. The sale was consistent with our strategy to realise value from late-life non-core assets,” Mr Gallagher said.

Final dividend

The Board has resolved to pay a 2018 final dividend of US6.2 cents per share fully-franked, in line with the company’s sustainable dividend policy which targets a range of 10% to 30% payout of free cash flow.

The final dividend will be paid on 28 March 2019 to registered shareholders as at the record date of 27 February 2019.

Santos dividends are determined and declared in US dollars and paid to shareholders in Australian dollars. Currency conversion for the final dividend will be based on the exchange rate on the record date of 27 February 2019. The Dividend Reinvestment Plan will not be offered for the 2018 final dividend.

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Earlier: 

2019, January, 25, 08:15:00 SANTOS ANNUAL REVENUE UP 19% SANTOS - Record quarterly sales revenue of $1,043 million, up 7% and including record quarterly LNG sales revenue of $449 million, up 11%. Record annual sales revenue of $3,696 million, up 19%

2018, October, 22, 11:35:00 SANTOS LNG UP BY 10% SANTOS - Strong production and revenue growth  Third quarter production up 6% to 15 mmboe due to strong performance across the core assets  Sales revenue up 10% to $973 million, including record quarterly LNG revenues of $405 million  PNG LNG achieved record daily rates equivalent to ~9.2 mtpa annualised production

2018, October, 1, 11:00:00 AUSTRALIA'S SANTOS: DOUBLE PRODUCTION REUTERS -India’s annual economic growth surged to a more than two-year high of 8.2 percent in the three months through June, giving Prime Minister Narendra Modi’s government a political boost in the final year of his term before elections.

2018, August, 22, 12:35:00 SANTOS BUYS QUADRANT: $2.15 BLN REUTERS - Australian oil and gas firm Santos Ltd said on Wednesday it has agreed to buy privately held Quadrant Energy for at least $2.15 billion, bagging access to what may be the biggest oil find off Western Australia in over two decades.

2018, April, 6, 18:05:00 SANTOS TAKEOVER: $10.4 BLN REUTERS - Australian gas producer Santos Ltd (STO.AX) said on Tuesday it would “engage with” Harbour Energy after receiving a $10.4 billion takeover offer from the U.S. company, its fourth unsolicited bid since August 2017.

2018, March, 4, 10:52:00 AUSTRALIA'S LNG INVESTMENT: $900 MLN GT - Santos and its GLNG partners—Petronas, Total and KOGAS—will make a massive capital investment of $900 million in upstream developments in the Maranoa, Western Downs, Central Highlands and Banana regions in Queensland this year.

2014, April, 17, 18:50:00 AUSTRALIAN OUTPUT RISES Australian Santos' Q1 output rises 1% on year to 12.2 mil boe