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Santos Quarterly Revenue Down

Santos Quarterly Revenue Down
Apr 17, 2015 By Imran Valibhoy

In a report to the ASX, Santos Limited (ASX:STO) announced a 24 per cent slide in sales revenue in the March quarter compared to the previous period. Sales revenue was down 10 per cent compared to a year earlier. The company cited falling global oil prices as the reason for lower revenue, which was partially offset by stronger domestic gas prices and a weaker Australian dollar. First quarter production of 14m barrels of oil and sales volume of 15.2m barrels of oil were 15 and 10 per cent higher respectively than the corresponding quarter. Santos managing director and chief executive David Knox discussed the company’s commitment to lower production costs and less capital expenditure. “First quarter capital expenditure was 40 per cent lower than last year, and we continue to make solid inroads towards reducing production costs per barrel across the business.”
 The company’s average realised oil price came in around US$56 (A$72) per barrel, which was 22 per cent lower than the previous quarter. Santos expects to reach its full year production guidance of 57 to 64 million barrels of oil equivalent (mmboe). Mr. Knox said the company had made solid progress on the commissioning of the Gladstone liquefied natural gas (GLNG) project and has kept the project within budget. Production at GLNG is expected to begin in the third quarter of 2015. Benchmark oil prices have recovered this week, jumping to US$56 per barrel. This has likely contributed to the company’s share price. Despite the fall in revenue, shares of STO are up 7c, or .88 per cent, at $8.00 per share around 12:47pm on Friday. STO has fallen over 40 per cent in the last 12 months and 3.21 per cent so far this year.

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Imran Valibhoy Author: Imran Valibhoy Apr 17, 2015

Since Joining the firm in 2006, Imran has worked on a range of M&A and Capital Market transactions in the natural resources, mining as well as projects in the renewable energy sector. Prior to joining Wise-owl, Imran worked at Euroz Securities in Perth, aiding in the advisory and valuation of companies in the mining and industrial sectors in Australia. Imran has a Masters in Banking & Finance from City University's Class Business School in London and a Bacheloor degree in Commerce from UWA.

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