Karoon Energy (KAR) H2 2024 earnings summary

Executive summary

• Achieved record production of 10.4 MMboe, up 13% year-over-year, though below guidance due to operational challenges at Baúna and Who Dat.

• Sales revenue reached US$776.5m, up 14% from 2023, with underlying NPAT of US$214.0m (+3%).

• Statutory NPAT declined to US$127.5m due to a non-cash tax adjustment and unsuccessful Who Dat West well expense.

• Strategic focus on disciplined capital allocation, maximizing value from Baúna and Who Dat, and progressing Neon.

• Announced acquisition of Baúna FPSO for US$115m plus transaction costs, targeting improved reliability and cost savings.

Financial highlights

• Revenue increased to US$776.5m, driven by higher production volumes; Who Dat contributed US$170.4m.

• Underlying EBITDAX rose 13% to US$492.4m, with a margin above 60% for both Baúna and Who Dat.

• Operating cash flow was US$434.6m; net debt reduced to US$8.8m from US$103.7m; liquidity at US$681m.

• Free cash flow from operations was US$176.6m, fully funding capex and capital returns.

• Capital expenditure totaled US$196.5m, with significant investments in Baúna and Who Dat.

Outlook and guidance

• 2025 production guidance: 9.0–10.5 MMboe; Baúna FPSO efficiency targeted at 88%-92% in 2025.

• Neon project FEED decision due April 2025; farm down process planned for H2 2025.

• Who Dat sidetrack drilling planned for H2 2025/early 2026; FID on new discoveries expected by early 2026.

• Capital returns policy targets 20-40% of underlying NPAT via dividends and buybacks, with up to US$75m buybacks planned for 2025.

• Guidance to be updated after Baúna FPSO transaction closes in Q2 2025.