Woodside 2013 Profit at USD 1.749 Billion

LNG player Woodside said strong production from its base business helped the company achieve a net profit after tax (NPAT) of US$1.749 billion in 2013. This profit result was underpinned by record annual production of 87 million barrels of oil equivalent (MMboe), up 2.5% on the previous year (84.9 MMboe) and supported by a full year of production from Pluto LNG.

Financial headlines

– Reported NPAT of US$1.749 billion was in line with analysts’ consensus of US$1.753 billion.

– Reported NPAT was the second highest result in the company’s history, exceeded only by the 2012 result, which was enhanced by the Browse partial equity sale.

– A record final dividend of US103 cents per share, up 58% on the 2012 final dividend.

– Record full year dividends of US249 cents per share up 92% on 2012. The 2013 dividend total is a record annual dividend and a result of Woodside’s strong financial position.

– Free Cash Flow (FCF) in 2013 of US$2.271 billion, taking the total FCF for the past two years to US$5.907 billion.

– Net debt of US$1.541 billion down 20% from the end of 2012. The company’s average cost of debt at 31 December was approximately 3.7% per annum, on a portfolio basis.

– Gearing of 9%, down from 11% at the end of 2012 with available funds of US$3.82 billion (including US$2.22 billion cash and US$1.60 billion undrawn debt).

– 2013 Investment Expenditure of US$0.851 billion, 52% lower than 2012, demonstrating a rigorous approach to capital management.

Woodside CEO Peter Coleman said the figures demonstrated Woodside’s strong operating cash flow and commitment to capital management.

“In 2013 we made disciplined investment decisions, including our decision not to proceed with the James Price Point development concept for Browse because it did not meet our commercial requirements for a positive investment decision,” he said.

Coleman said Woodside had achieved healthy margins in 2013, despite a change in product mix. Underlying profit had been impacted by a higher proportion of lower priced gas volumes, which saw a decline in average realised pricing. Impairments to some mature oil assets also affected the result.

“We have generated $5.9 billion in free cash flow over the past two years. This has enabled us to pay back debt and reward our shareholders through increased dividends. Importantly, it also provides the financial base for our next phase of growth.”

Coleman said the company had made good progress on its corporate strategy, which involved optimising its core business, leveraging its capabilities and growing its portfolio.

“Growth opportunities in Ireland, Myanmar, New Zealand, Canada and Israel demonstrate a clear link between our capabilities and future value.”

Woodside reaffirmed its 2014 production target range of 86 to 93 MMboe.

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Press Release, February 19, 2014; Image: Woodside