Karoon Energy shares lower on Baúna project delays
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The news: Shares in Karoon Energy edged down on the ASX after the oil and gas major reported a mixed first-half result, as profit and earnings beat estimates but full-year production at its Baúna project is expected to fall at the lower end of guidance.
The numbers: Karoon shares lowered 1.13% to $1.74 by 1:42pm AEST, having fallen 24.8% over the last 12 months.
Underlying net profit after tax reduced 20% half over half to USD115.8 million ($170.33 million), but came in 5% ahead of average estimates of USD110 million. Underlying EBITDA of USD265 million came in 3% above consensus forecasts of USD259 million.
Karoon declared an inaugural interim dividend of 4.496 cents per share, below consensus expectations of 5.6 cents per share.
The context: Karoon said the fall in profit was due to a fall of 34% in production from its Baúna field in Brazil, partially offset by the first full half-year contribution from Who Dat in the US Gulf of Mexico.
Jarden analysts described the result as "mixed but overall small negative". They noted that while underlying NPAT beat expectations, full-year production at Baúna is expected to be towards of the lower end of its guidance range due to delays to an intervention at the site's SPS-88 well.
Karoon now hopes to have the well online by mid-2025, compared to Jarden's previous expectations of April 2025.
What they said: Karoon's CEO and managing director Julian Fowles said: "While 20% lower than in TY23, Karoon's underlying 1H24 NPAT of USD115.8 million demonstrates the improved resilience of Karoon's operations now that the company has two assets and a diversified earnings base".
"The profits generated from Who Dat partially offset the lower profitability from the Baúna project, which was impacted by a three week scheduled maintenance shutdown. FPSO [floating production storage and offloading] reliability issues, the continued outage of SPS-88 and expected natural decline," he said.
The sources: ASX announcement, Jarden research, RBC Capital Markets research
