The Oil Search Ltd (ASX: OSH) share price has edged lower in the days following the company's FY21 half-year scorecard. The energy producer recorded a solid operational performance as well as strengthened market conditions.
Meanwhile, Santos Ltd (ASX: STO) reported its FY21 earnings on 17 August, also announcing a robust result. However, its share price had a few mixed trading days based on fluctuations in the spot price of oil.
Comparing the financial figures of the two companies can give investors a clearer picture of how the industry is travelling.
Let's take a look at how the Oil Search earnings result stacks up against Santos' numbers.
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A recap on the Oil Search earnings result
Here's a summary of the financial details that Oil Search posted for the 6 months ending 30 June 2021.
- Total sales revenue of US$667.7 million, up 7% on the prior corresponding period;
- Earnings before interest, tax, depreciation and amortisation and exploration (EBITDAX) of US$488.8 million, down 8%;
- Net profit after tax (NPAT) of US$139 million (H1 FY20 net loss after tax of US$266.2 million), and
- Interim dividend declared of US3.3 cents per share (no dividend declared in H1 FY20).
The sound result benefited from a price recovery in oil and liquified natural gas (LNG) predominately in Asia. Higher realised prices coupled with management's focus on reducing costs led to a significant improvement in the company's financial health.
How does this compare to Santos?
Santos revealed its own FY21 earnings, highlighting record production of 47.3 mmboe (million barrels of oil equivalent). Let's see how it stacked up against Oil Search's result.
- Total sales revenue of US$2,040 million, up 22% on the prior corresponding period;
- Earnings before interest, tax, depreciation and amortisation and exploration (EBITDAX) of US$1,231 million, up 24%;
- Net profit after tax of US$354 million, up 222%, and
- Interim dividend declared of US5.5 cents per share, up 162%.
Santos turned its fortunes around with higher oil prices realised in the first half coupled with record sales volumes of 53.8 mmboe.
In addition, higher oil prices were realised but were offset by lower LNG (liquified natural gas) prices due to long-term, fixed-price offtake contracts.
Comparing Oil Search's earnings with those of its rival, there are somewhat softer similarities in terms of revenue growth. Although when it comes to EBITAX and NPAT, Santos is far ahead of Oil Search in both numbers and percentage increases.
Oil Search share price snapshot
It has been a modest 12 months for Oil Search shares, posting a gain of almost 20% over the period. Year to date, the company's share price is relatively flat, up 1% though.
Oil Search commands a market capitalisation of roughly $7.8 billion, with more than 2 billion shares on its books.
