Santos pumps disappointing profit as Knox docked
Saturday, 18 February 2012 | 00:00
Oil and gas producer Santos's full-year profit result has disappointed analysts, missing consensus forecasts by almost 10 per cent.
The company reported a 20 per cent jump in underlying net profit, to $453 million, after stripping out asset sales which boosted the headline net profit after tax to $753 million - a 51 per cent increase on the $500 million reported the previous year.
Santos also released remuneration details for 2011, including a reported 12 per cent pay cut for CEO David Knox, whose total package fell from $4.3 million to $3.8 million last year.
While Mr Knox's base pay rose from $2.13 million to $2.25 million last year, the value of his short-term incentive fell and he did not receive a long-term incentive in 2011.
Santos made a $408 million net profit from asset sales, including a 15 per cent interest in the Gladstone LNG project. It also recognised $102 million worth of impairments on writedowns on other assets.
Citi analyst Mark Greenwood said the underlying profit result was almost 5 per cent lower than his own forecasts, and 9 per cent lower than the consensus estimate of analysts covering the stock.
Santos' sales revenue was up 14 per cent to $2.53 billion.
Gas sales volumes were down by 2 per cent on the previous year but higher prices for ethane and liquefied natural gas (LNG) more than offset that.
Crude oil production was slightly higher but, again, significantly higher prices generated growth in sales revenue.
Santos maintained its production guidance for 2012 of 51 to 55 million barrels of oil equivalent (mmboe).
Production in 2011 was 47.2 mmboe.
Four new projects commissioned in recent months would drive production growth in 2012, Santos said in a statement.
Santos declared a fully-franked interim dividend of 15 cents per share.
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