Santos (STO) H2 2023 earnings summary

Executive summary

• 2023 total revenue was $6.034 billion, EBITDAX $4.083 billion and underlying profit $1.423 billion; lower volumes and realised prices reduced revenue YoY.

• Free cash flow from operations was $2.128 billion; cash returns to shareholders reached a record $852 million, including a declared 17.5 US cents/share final dividend.

Financial highlights

• Sales revenue was $5.889 billion versus $7.790 billion in 2022; EBITDAX was $4.083 billion versus $5.646 billion.

• Net profit after tax was $1.416 billion versus $2.112 billion; underlying profit was $1.423 billion versus $2.461 billion.

• Operating cash flow was $3.258 billion and free cash flow from operations $2.128 billion; investing cash flows were $2.896 billion before specified adjustments.

• Total revenue was $6.034 billion and EBITDAX margin 68%; capex was $2.873 billion.

Outlook and guidance

• 2024 production guidance is 84–90 mmboe; sales volumes 87–93 mmboe; sustaining capex ~ $1.25 billion and major-project capex ~ $1.6 billion.

• 2024 unit production cost guidance is $7.45–$7.95/boe; free cash flow breakeven target is < $35/bbl unhedged.

• Targeting ~6% production CAGR from 2024–2028 and total free cash flow of US $14 billion over 2024–2028, assuming ~$75/bbl Brent and ~$12/mmBtu JKM in 2023 real terms.

• Barossa first gas is targeted for Q3 2025; Pikka Phase 1 is on track for 1H 2026.