Beach Energy share price gains as dividend doubled

The company has doubled its dividend despite its profit tumbling last half.

| More on:
Oil miner holding a laptop and mobile phone looks at his phone and sees the falling oil price and falling Woodside share price

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

Key points

  • The Beach Energy share price is rising 0.33% right now to trade at $1.515
  • Its gain comes on the back of its first half earnings, detailing a 10% slump in underlying post-tax profits
  • Meanwhile, the company doubled its interim dividend to 2 cents per share

The Beach Energy Ltd (ASX: BPT) share price is climbing on Monday after the company posted its first-half earnings this morning.

Shares in the S&P/ASX 200 Index (ASX: XJO) oil and gas producer are up 0.13% at the time of writing, trading at $1.512.

Here are the highlights:

Beach Energy share price gains on 2-cent interim dividend

Beach Energy produced 10 million barrels of oil equivalent last half – a 10% drop – and posted $569 million of capital expenditure. Its unit field operating cost came in at $14.46 per barrel.  

The company's sales revenue increased on higher third-party sales, favourable foreign exchange rates, and higher realised oil and contracted gas prices. Meanwhile, its profit slumped amid higher sales and financing costs.

It also updated its dividend policy. It will now aim to payout 40% to 50% of its pre-growth cash flow to shareholders.

What else happened last half?

The company progressed and derisked its projects in the Otway and Perth basins last half.

It agreed for Webuild to complete the Waitsia Stage 2 project, with first gas targeted for the end of this year. Meanwhile, its Thylacine wells are expected to provide up to an extra 100 terajoules each day, with first gas tipped to the middle of the year.

Finally, work continued at its Moomba carbon capture and storage (CCS) project. It's now 40% complete.

What did management say?

Beach Energy CEO Morné Engelbrecht commented on the news driving the company's share price today, saying:

Our continued balance sheet strength, including a net cash position at the end of the half, supports our decision to implement our new dividend policy now.

It ensures Beach can continue to invest further in growth beyond our current projects while increasing dividend payments to shareholders.

What's next?

The company also updated its full-year guidance this morning. It now expects to produce 19 million to 20.5 million barrels of oil equivalent – down from its previous guidance of between 20 million and 22.5 million.

It also narrowed its capital expenditure guidance to between $900 million and $1 billion and increased its expected unit field operating costs to between $13.75 a barrel and $14.75 a barrel.

Finally, it will no longer be refencing its financial year 2024 production target. It says future production will be subject to the timing of major project delivery.

Beach Energy share price snapshot

The Beach Energy share price has been underperforming the ASX 200 lately.

The stock has dropped 4% year to date while the index has lifted 7%.

Looking longer term, shares in Beach Energy have fallen 6% over the last 12 months while the ASX 200 has gained 2%.

Motley Fool contributor Brooke Cooper 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 Scott Phillips.

More on Earnings Results

Business people discussing project on digital tablet.
Earnings Results

2 ASX All Ords shares surging over 10% on strong results

Investors are buying these shares in response to strong results this morning.

Read more »

A young woman holds her hand to her mouth in surprise as she reads something on her laptop.
Earnings Results

Xero share price rockets to record high on explosive half-year growth

The tech star delivered another impressive half year results this morning.

Read more »

A man cheers after winning computer game while woman sitting next to him looks upset.
Earnings Results

2 high-flying ASX 200 gaming shares splitting ways today

Which gaming giant is winning the admiration of investors amid results?

Read more »

Male building supervisor wearing high vis vest and hard hat stands and smiles with his arms crossed at a building site
Industrials Shares

This $23 billion ASX 200 stock is surging 6% while the market sinks. Here's why

This ASX 200 stock is shrugging off the wider market sell down today and racing higher. But why?

Read more »

Unsure man analysing data on laptop.
Earnings Results

ASX 200 tech stock sees red as investors punish Q3 results

Investors continue digesting the numbers.

Read more »

Female miner smiling in front of mining vehicle.
Resources Shares

Guess which ASX lithium share is racing 8% higher on record production

Investors are sending the ASX lithium share racing higher on Wednesday.

Read more »

A woman wearing yellow smiles and drinks coffee while on laptop.
Earnings Results

CBA shares on watch after delivering $2.5b quarterly profit

The banking giant has made a big quarterly profit. But will it be enough for the market?

Read more »

a farmer kneels on one leg and closely examines soil from his farm against a blue sky backdrop.
Earnings Results

ASX 200 consumer stock surges despite loss and dividend cut

Investors were quick to overlook the negatives.

Read more »