Lending Association

Beach Energy records $721m write-down

In the six months to December, Kerry Stokes’s 30%-controlled oil and gas producer, Beach Energy (ASX:BPT), faced a substantial setback, taking a $721 million write-down in the value of its Cooper Basin assets. The impairment, totaling $505 million after tax, led to a reported net loss of $345.1 million.

Directors attributed the $721.1 million of impairments to “Cooper Basin producing carrying values and Cooper Basin, SA Otway, and Bonaparte exploration carrying values.”

Despite this setback, Beach maintained its interim dividend at 2 cents per share. However, the company experienced a dip in production and revised its full-year production guidance downwards, despite achieving higher sales in the December half.

Production for the six months totaled 8.8 million barrels, reflecting an 11% decrease compared to the same period in 2022. Nevertheless, sales revenue increased by 16% to $954 million, mainly due to the first LNG and condensate gas shipments from the Waitsia field in WA.

The underlying net profit fell to $172.7 million for the six months, a significant decline from the previous period.

Beach adjusted the upper end of its full-year production guidance from 21 million barrels to 20 million barrels.

Notably, Beach Energy is the second company in the Stokes empire to report; Friday saw Boral, controlled by 69%, reporting better-than-expected results. On Tuesday, it’s the 40%-controlled Seven West Media, with an expected weak performance, followed by the listed parent, Seven Group Holdings, controlled 57% by the Stokes family, on Wednesday.