Beach Energy (BPT) shares returned to levels last seen back in 2006 yesterday after releasing solid earnings for the six months to December, revealing a special dividend, and upgrading its full year production outlook.
Beach shares ended up 6.7% at $1.625 – the day’s high was $1.675 – both levels last reached eight years ago.
The performance came in a market that couldn’t make up its mind all day, falling, rising and then falling again.
The group will pay an interim dividend of one cent and a special dividend of one cent, both fully franked, to shareholders on March 7.
The special dividend effectively doubled the one cent a share interim paid for the previous corresponding half year.
Beach said net profit attributable to members jumped 267% to $160.5 million for the six months to December 2013, compared with $44 million in the previous corresponding period, mainly due to higher oil production from the Western Flank and higher prices for most products.
Other income included a gain of $14 million on the sale of joint venture interests, mainly its interests in North Dakota in the US.
Revenue rose by 62% to $559.5 million in the half-year, a performance laid out in the December quarter and half year production report released last month.
Gross profit for the December half year was $239 million, up 123% from the $107 million for the first six months of the 2012-13 financial year.
Beach confirmed that sales volumes hit a record 5.6 million barrels of oil equivalent in the December half, due to higher production and increased third party oil volumes, partly offset by lower gas sales due to lower contracted gas volumes.
The lower Australian dollar also boosted revenue, Beach said in yesterday’s report.
BPT 1Y – Beach Energy raises dividend after huge profit boost
Looking to the rest of the year, Beach said it expected Australian dollar oil prices to remain “strong” in the second half, while oil production in the key oil fields in the western part of the Cooper Basin should flow at maximum available capacity. (They’re the ones that helped boost production in calendar 2013 for the company and its partners.)
Beach also highlighted the expected flow testing this June half of five wells in its unconventional exploration play in the Nappamerri Trough plan in the Cooper Basin, as well as the completion of a deal to sell a stake in an exploration venture in Lake Tanganyika.
All have the capacity to lift production this financial year and into 2014-15.
Beach said it had $A404 million in cash in the bank, and a standby credit line of $200 million.
It has previously said it should be able to finance its 2014 exploration and production activity out of cash flow and cash reserves. Cash flow for the half was $A276 million.
