Business Description:
Santos Limited (STO) operates in the exploration, development, production, transportation and marketing of hydrocarbons. Santos produces natural gas to Australian, Indonesian and other Asian markets. Santos has also developed oil and liquids businesses in Australia, Indonesia and Vietnam. Santos also focuses on transformational liquefied natural gas (LNG) strategy and has interests in four LNG projects in Australia.
Santos' vision is the leading firm in South East Asian Energy Organization through its portfolio of growth projects. Strategy centers on the Cooper Basin, Eastern Australian gas, Western Australian oil and gas, LNG projects and Asian growth. It is continuing to build South East Asian interests while undertaking high impact exploration and developing new projects to drive production and earnings growth. Santos reported NPAT of $504m for the half-year ended 30 June 2011, which is $306m higher than in 2010. This increase is primarily due to the $348m before tax gain on sale of non-current assets ($246m, NPAT) largely as a result of the sale of 15% of the GLNG project during the period, combined with lower production costs and exploration expense, and higher net finance income as interest associated with development projects was capitalized. Revenues from ordinary activities were $1.15bn, up 1% from the same period last year. Diluted EPS was 57.2 cents compared to 23.7 cents last year. Net operating cash flow was $681m compared to $537m last year. The interim dividend declared was 15 cents compared with 22 cents last year.
Financial Summary
Year to Dec
NPAT
EPS
EPS chg (%)
PER
DPS
Yield (%)
Franking (%)
2013 F
61.4
-10.4
20.0
30.0
2.4
2012 F
68.5
35.6
18.0
30.1
2.4
2011 A
50.5
15.4
26.4
31.4
2.4
Source: Morningstar analyst estimates.
Peer Comparison
EPS Growth (%)
P/E (%)
Dividend Yield (%)
Company
Mkt Cap
2011 A
2012 F
2013 F
2011 A
2012 F
2013 F
2011 A
2012 F
2013 F
Beach Energy (BPT)
$1,381 M
0.4697
-0.6552
18.5185
12.6002
36.5449
0.0157
0.0159
0.0169
Karoon (KAR)
$1,005 M
0.0000
Oil Search (OSH)
$8,947 M
0.6203
-0.3491
0.2151
38.4000
58.9991
48.5549
0.0059
0.0060
0.0064
Santos (STO)
$11,433 M
0.1340
0.2859
-0.1115
23.6081
18.3599
20.6647
0.0250
0.0250
0.0250
Woodside Petroleum (WPL)
$25,533 M
0.1409
0.1680
0.1823
15.0554
12.8894
10.9020
0.0349
0.0381
0.0489
Market Comparison
Earnings
P/E Ratio
P/B Ratio
P/E Growth
P/S Ratio
STO
1.35
21.8
1.30
3.16
4.17
Market
0.83
12.1
1.34
1.35
1.69
Sector
