Beach Energy slips on results miss

Shares in Kerry Stokes-backed Beach Energy plummeted more than 13 per cent during trading with the market seemingly underwhelmed by the oil and gas business’ production outlook.

Favourable commodity prices helped Beach bolster its key financial metrics throughout the year, lifting revenues by 13 per cent to reach $1.8 billion while EBITDA climbed 17 per cent to $1.1 billion.

That brought underlying net profit after tax to $504 million, which is 39 per cent higher than last year.

However, Beach copped lower output throughout the year, delivering 21.8 millions of barrels of oil equivalent (MMboe) compared to 25.6 MMboe in fy21.

Further, Beach has forecast potentially lower output next year with guidance in the range of between 20 MMboe and 22.5 MMboe.

Beach chief executive Morné Engelbrecht acknowledged the weaker output.

“The 2022 financial year brought into sharp focus the important role natural gas currently plays in providing energy security, and will continue to do so for decades to come,” he said.

“Despite lower production, increased demand and pricing for our products saw a rise in earnings and cash flows,” he added.

Operating costs, which averaged $11.74 per barrel of oil equivalent for 2022, are likely to rise to between $12 and $13 per boe based on guidance for 2023.

Regarding WA projects, Mr Engelbrecht said stage 2 of the Waitsia project in the Perth Basin had commenced with ‘good progress’ and was targeting first LNG sales during the second half of 2023.

Beach inked a sale and purchase agreement with bp for all 3.75 million tonnes of the company’s anticipated LNG volumes from Waitsia earlier this month.

Kerry Stokes’ Seven Group Holdings owns a 30 per cent stake in Beach Energy.

Beach shares closed the day down 11.08 per cent to trade at $1.64.