Karoon shares climb on 2024 growth, buyback plans
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More news: Karoon Energy shares gained on the ASX after the oil and gas explorer reported a rise in calendar-year production and sales revenue, and announced plans for a $120 million buyback.
Karoon shares were up 3.9% to $1.48 by 11am AEDT, having lowered by nearly 25% over the last 12 months.
Karoon Energy posts Q4 production dip, unveils $120m buyback
The news: Karoon Energy reported a drop in fourth-quarter output after a series of operational challenges hindered production during the three months to December 2024.
The oil and gas explorer also said it plans to undertake further on-market share buybacks of a USD75 million ($120 million) during the 2025 calendar year.
The numbers: Karoon reported Q4 production of 2.59 million barrels of oil equivalent (MMboe), down 3% quarter on quarter. However, it helped take calendar-year production to 10.4 MMboe, a record for the company.
Fourth-quarter sales volumes of 3.14 MMboe were 53% higher quarter on quarter, due to timing of liftings at Karoon's Baúna field in Brazil, resulting in sales revenue of USD222.2 million. Sales revenue for the calendar year was USD776.5 million, up 14% compared to 2023.
Meanwhile, Karoon said it will undertake USD75 million of on-market share buybacks over the course of this calendar year. Combined with the current active USD25 million buyback program, this would represent a total investment of USD125 million in Karoon shares between June 2024 and December 2025.
The context: Karoon attributed the decline in Q4 production to "a number of operational challenges" during the quarter, including a 12-day shut-in to repair two floating production storage and offloading anchor chains at Baúna and an active hurricane season in the US Gulf of Mexico.
On its buyback plans, Karoon said the move follows "careful consideration" of the company's capital allocation framework, an assessment of incremental shareholders returns, and the capital needs of the business. It also reflects the board's view that Karoon shares are currently "significantly undervalued", the company said.
The sources: ASX announcement, ASX announcement
