2018 turned out to be a big year for Santos – it was a year of record revenue – a year for narrow escapes and a major expansion.
And hopefully, next month shareholders will see a solid profit and dividend payout – with any excess franking credits being handed to shareholders in case the ALP wins the May poll.
The company survived a takeover attempt from a US investment fund and then bought Quadrant, a WA focused oil and gas producer to change its production profile.
On Thursday Santos reported a 21% rise in fourth-quarter revenue, thanks to the Quadrant buy and higher realised prices for its oil and gas. Quarterly revenue came in at $1.043 billion compared with $861 million a year earlier, the company said in a statement.
Revenue for the year jumped to a record $3.696 billion up 19% from just over $3.1 billion in 2017.
The Adelaide-based firm said production for the quarter ended December 31 rose to 15.9 million barrels of oil equivalent (mmboe) from 15 mmboe a year ago.
As at December 31, Santos had cash and cash equivalents of $1.3 billion and total debt of $4.9 billion, resulting in net debt of $3.6 billion and gearing of approximately 33%
CEO, Kevin Gallagher said in a statement with yesterday’s report: “In 2018, Santos delivered higher production in the onshore business and acquired Quadrant Energy which will provide a significant boost to our production in 2019.”
“Our cash generative asset portfolio set new records for quarterly and annual sales revenues, notwithstanding the divestment of our non-core Asian assets during the year, while our low cost and disciplined operating model enabled more investment in exploration and appraisal to improve ongoing organic resource and reserve replacement.”
“With the completion of the value-accretive Quadrant Energy acquisition in November, we are now focused on integrating these low cost, long-life conventional assets and realising the $30-50 million combination synergies per annum.”
“In 2019, we will focus on our disciplined growth portfolio, including PNG LNG expansion, Barossa backfill to Darwin LNG, appraisal of the exciting Dorado oil discovery and lifting the drilling activity to grow production and appraisal activity in our onshore business.”
“Santos is positioned for growth across each of our five core assets and we are targeting production of more than 100 mmboe by 2025, almost double 2018’s level,” Mr. Gallagher said.
The shares rose 3.8% to $6.19.