What you need to know about the Santos (ASX:STO) dividend

A tasty pay day is on the way for Santos shareholders

| More on:
Coffee Cookie Dollar signs and dividends

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Santos Ltd (ASX: STO) dividend is one for investors to keep a close eye on. Santos this morning more than doubled its interim distribution to US 5.5 cents per share.

However, shares in the Aussie oil and gas giant have still slid 1.7% lower at the time of writing following its half-year result.

What you need to know about the Santos dividend

Let's start with a brief look at the Santos results as a whole. The Aussie energy producer reported its half-year results this morning including the below highlights:

  • Net profit after tax of US$354 million (~A$484 million), up from US$289 million (~A$396 million) loss in prior corresponding period (pcp).
  • Revenue increased 22% compared to last year's first half to US$2 billion (~A$2.7 billion)
  • Earnings before interest, taxes, depreciation, amortisation, and exploration (EBITDAX) of US$1.2 billion (A$1.6 billion) – up 24% on the pcp.
  • Free cash flow of US $572 million, up 33% on 1H 2020 figures.
  • Santos dividend (interim) up 162% to US 5.5 cents per share.

That last item is the one that would have caught the eye of many a shareholder. Santos has more than doubled its interim dividend to US 5.5 cents (~7.5 cents in AUD) according to today's release.

The Santos dividend increase has come during a period of fluctuating commodity prices and changing supply and demand dynamics.

Santos delivered strong free cash flow throughout the year thanks to record production across its diversified portfolio and cost reduction efforts. A reopening in the first half of the year boosted oil and gas prices and helped increase revenue for the group.

Those strong earnings figures have allowed the Board to increase the Santos dividend but the company's share price is still sliding on Tuesday afternoon.

One looming factor for the Santos share price is the proposed merger with Oil Search Ltd (ASX: OSH).

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Energy Shares

A man in his 30s holds his laptop and operates it with his other hand as he has a look of pleasant surprise on his face as though he is learning something new or finding hidden value in something on the screen.
Share Gainers

Boss Energy shares have rocketed 90% in a month. Here's why

The massive rally in Boss Energy shares will be painful to the host of short sellers betting against the uranium…

Read more »

Oil worker using a smartphone in front of an oil rig.
Energy Shares

ASX 200 energy shares plunge on shock OPEC move

ASX 200 energy shares like Woodside and Santos are tumbling on Monday. Let’s find out why.

Read more »

Female oil worker in front of a pumpjack.
Energy Shares

Should you buy Woodside shares in May?

Is this energy giant a good investment right now?

Read more »

Hand holding out coal in front of a coal mine.
Energy Shares

Down 20% this year, are Whitehaven Coal shares a buy, hold or sell according to Macquarie?

Here’s what’s in store for this Australian independent coal producer.

Read more »

Rocket powering up and symbolising a rising share price.
Energy Shares

Guess which ASX uranium stock could rocket 45%

Big returns could be on offer from this stock. Let's see what Bell Potter is saying.

Read more »

A miner stands in front of an excavator at a mine site.
Energy Shares

3 ASX 200 uranium shares soaring 10%-plus today

What has got investors excited today?

Read more »

An oil worker in front of a pumpjack using a tablet PC.
Energy Shares

Woodside shares higher on 'game-changer' news

Let's see what the energy giant has announced on Tuesday.

Read more »

A Paladin Energy miner wearing a hard hat and protective gear stands in front of a large mining truck and smiles to the camera.
Energy Shares

Paladin Energy shares have surged 32% in 2 days. Macquarie says that's the tip of the iceberg

After a tough year, the future is looking brighter for Paladin Energy shares.

Read more »