Australia's Woodside beats HY profit estimates, retains high dividend payout
HY24 underlying NPAT down 14% to $1.63 bln
Declares interim dividend of 69 US cents per share
Focus likely on sustainability of 80% payout ratio - Citi
Shares up as much as 4.1%
Recasts, adds shares, details and analysts' comments in paragraphs 7-9
By Himanshi Akhand
Aug 27 (Reuters) -Shares of Woodside Energy WDS.AX rose 4% on Tuesday, as the Australian firm posted better-than-expected profit after lower production costs offset the impact of weaker realized oil prices, and declared a dividend at the top-end of payout range.
Supply-chain disruptions due to tensions in the Middle East have resulted in choppy oil prices, while economic recovery at top importer China faces hurdles due to weak domestic consumption.
Woodside's average realized price for the first-half fell to $63 per barrels of oil equivalent (boe) from $74 in the same period last year.
The country's largest independent energy firm posted an underlying net profit after tax of $1.63 billion for the six-month period ended June 30, compared with $1.90 billion a year earlier, and also beat a Visible Alpha consensus estimate of $1.38 billion.
"We maintained high reliability of 97.9% at our operated LNG assets and continue to manage costs effectively in an inflationary environment," Chief Executive Meg O'Neill said in a statement.
The company declared an interim dividend of 69 U.S. cents per share, down from 80 U.S. cents a year earlier, but still representing the top-end of its 50% to 80% payout range.
Shares of the company were up as much as 4.1%, as of 0023 GMT, while the broader market .AXJO rose 0.3%.
"Woodside seem intent on maintaining an 80% payout ratio, which may provide the market with some comfort," Citi analysts said.
The brokerage, however, said funding reinvestment in the business and maintaining an 80% payout ratio could be more difficult amid a bearish oil price outlook.
Woodside said its deal to buy U.S. liquefied natural gas developer Tellurian TELL.A and OCI Global's OCI.AS clean ammonia project, both of which came under investors' radar over investment return concerns, "have significant cash generation potential to underpin long-term shareholder value".
Reporting by Himanshi Akhand and Roshan Thomas in Bengaluru; Editing by Mohammed Safi Shamsi and Sherry Jacob-Phillips
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
