Beach Energy Limited · ASX:BPT
Beach Energy — H1 FY23 Earnings Presentation
36 slides from Beach Energy's earnings presentation, Feb 13, 2023
Slide 1: FY23 half year results
FY23 half year results 13 February 2023 1
Slide 2: Compliance statements
Compliance statements Disclaimer Assumptions This presentation contains forward-looking statements, including statements of current intention, opinion and predictions FY23 guidance is uncertain and subject to change. FY23 guidance has been estimated on the basis of the following regarding the Compan
Slide 3: Key messages
Key messages Progressing and de-risking major growth projects Growing Growing Investing in Gas-supported Gas & LNG Strong FCF Future Growth transition ▪ Otway Thylacine first ▪ Targeting eight plants ▪ 12+ months of Perth ▪ 2050 net zero aspiration gas targeted by mid- supplying local and Basin expl
Slide 4: Health, safety and environment
Health, safety and environment Improving performance during an active period Safety performance – Total recordable injuries H1 FY23 highlights 16 15.6 14.5 ✓ Recipient of SA Premier’s Energy & Mining Award: Environment 12 7.9 4.4 o Innovative approach for acquiring geophysical data by 3.8 3.7 8 13 8
Slide 5: First half financial results
First half financial results Maintaining financial strength during major project execution 10.0 MMboe 10% $813 million 3% $491 million 4% Production Sales revenue Underlying EBITDA $191 million 10% $609 million 10% 2.0 cps 100% Underlying NPAT Liquidity Interim dividend 5
Slide 6: Progressing major projects
Progressing major projects Otway and Perth Basin developments Otway Offshore Thylacine well connections Waitsia Stage 2 project ✓ Environmental Plan approval for connection of wells ✓ Webuild confirmed as contractor to complete the project ✓ Thylacine well connections on schedule ✓ Targeting first g
Slide 7: Progressing key growth initiatives
Progressing key growth initiatives Achieving milestones despite challenges Offshore Otway drilling campaign completed Webuild to complete the Waitsia Stage 2 project Otway Thylacine well connections on Waitsia development drilling campaign schedule – DOF vessel on location completed Milestones Kupe
Slide 8: Capital management framework
Capital management framework Funding growth and higher returns to shareholders Diverse asset Balance capital Prudent financial portfolio and returns and future management revenue streams growth Capital Management Framework Deliver franked Continued Balance Continued investment returns to Sheet stren
Slide 9: Second half focus
Second half focus Major projects progressing to completion Western Flank oil well connections and development drilling focus to increase production rates Complete Thylacine well connections Progress construction of the Waitsia Gas Plant Commence Beach-operated Perth Basin gas exploration Investment
Slide 10: FY23 guidance update
FY23 guidance update FY23 guidance FY23 capital expenditure guidance: $900 – 1,000 million Original Revised H1 FY23 ~12.5% ~5% Production (MMboe) 20.0 – 22.5 19.0 – 20.5 10.0 ~30% Cooper Basin JV Development ~25% ~12.5% Western Flank Capital expenditure ($ million) 800 – 1,000 900 – 1,000 569 Explor
Slide 11: Increasing East Coast gas market share
Increasing East Coast gas market share Maturing new gas supply from existing portfolio ~12% East Coast gas market share, growing to ~16% in FY24 Thylacine well connections to enable OGP capacity rates1 ▪ Offshore Otway project nearing completion Thylacine Diving Pipeline End Manifold Interface Struc
Slide 12: Valuable Perth Basin acreage
Valuable Perth Basin acreage LNG and domestic gas focus Waitsia LNG, facility expansions and exploration Waitsia LNG SPA expected to deliver superior pricing ▪ Webuild to complete the Waitsia Stage 2 project1 (A$/MMBtu) Domestic Gas Illustrative LNG SPA Pricing3 ▪ Waitsia LNG and domestic gas commit
Slide 13: Targeting 35% emissions intensity reduction by 2030
Targeting 35% emissions intensity reduction by 2030 Beach targets aligned with proposed Safeguard Mechanism changes Progressing several early-stage sustainability initiatives Moomba CCS on schedule for first CO2 injection in 2024 ▪ Targeting up to 1.7 Mtpa CO2 storage (>0.5 Mtpa net Beach) ▪ Potenti
Slide 14: Financial Results
F Y 2 3 H A L F Y E A R R E S U LT S Financial Results
Slide 15: Headline financial metrics
Headline financial metrics Lower production partially offset by higher realised prices $ million (unless otherwise indicated) H1 FY22 H1 FY23 Change H1 FY23 sales revenue: $813 million Production (MMboe) 11.0 10.0 (10%) Sales volumes (MMboe) 11.2 10.5 (7%) Sales revenue 786 813 +3% NZ West Coast gas
Slide 16: Underlying Net Profit After Tax
Underlying Net Profit After Tax1 Higher-cost operating environment reflected in earnings $ million Underlying NPAT down 10% due to: 30 ▪ Lower production and sales volumes (49) ▪ One-off non-cash revenue reduction from (4) (8) revised Cooper Basin recognition point4 (2) 11 ▪ Higher cash costs, prima
Slide 17: Cash flow movements
Cash flow movements Elevated capital expenditure for major growth projects $ million ▪ Cash reserves down 25% to $189 million Growth (217) expenditure ▪ $527 million capital expenditure payments 404 o Includes $217 million growth expenditure ▪ Operating cash flow of $404 million o $522 million net o
Slide 18: Balance sheet strength
Balance sheet strength Net cash position maintained while delivering major growth projects Available Liquidity ($ million) 765 Successful debt 673 facility refinance ▪ $609 million available liquidity to $600 million 609 o $9 million net cash 510 o $600 million committed revolving syndicated loan fa
Slide 19: New dividend policy
New dividend policy 40-50% pre-growth free cash flow1 payout ratio Capital Management Framework Maximisation of free cash flow through diverse asset portfolio and delivery of major projects Dividend Policy ▪ 40-50% payout of pre-growth free cash flow1 Continued Balance Deliver franked Continued ▪ Bo
Slide 20: Outlook
F Y 2 3 H A L F Y E A R R E S U LT S Outlook
Slide 21: Exposure to five markets with strong fundamentals
Exposure to five markets with strong fundamentals Beach increasing energy supply to key markets East Coast gas market Global oil and liquids West Coast gas market New Zealand gas market Global LNG ▪ Beach ~12% market share ▪ Beach ~2% market share ▪ Beach ~8% of gas market share ▪ Geopolitical / ene
Slide 22: Potential FY24 – FY25 activity
Potential FY24 – FY25 activity Multiple organic growth opportunities across the portfolio Western Flank One rig plus one workover rig Targeting up to 30 wells per year Namur exploration and appraisal Birkhead horizontals and fracture stimulation Perth Basin Trigg, BSD, Tarantula Redback, Peacock Coo
Slide 23: Perth Basin
Perth Basin A major growth region for Beach Asset overview ▪ Interests: 50% interest and operator of Beharra Springs (Mitsui 50%); 50% interest in Waitsia (Mitsui 50% and operator) ▪ Assets: Beharra Springs Gas Plant (22 TJ/day capacity); Xyris Gas Plant (24 TJ/day capacity); Beharra Springs and Wai
Slide 24: Perth Basin exploration and appraisal
Perth Basin exploration and appraisal 12+ months of potential drilling ahead Indicative planned Follow-on success activity Prospect Depth (km MD) spud date Elegans1 3.2 Plugged and abandoned Gynatrix1 3.6 Production testing late 2023/early 2024 Confirmed Trigg 1 4.8 Q4 FY23 Trigg 2, Trigg North 1, T
Slide 25: Multiple prospects adjacent and analogous to discoveries
Multiple prospects adjacent and analogous to discoveries Proximal to Beharra Springs and West / South Erregulla discoveries ▪ Trigg 1 anticipated spud early Q4 FY23 o On trend with the West Erregulla and South Erregulla discoveries ▪ Rig will then move along structure to test the independent Trigg N
Slide 26: Otway Basin
Otway Basin Investing in new gas supply to support the East Coast market Asset overview ▪ Interest: 60% interest and operator (O.G. Energy 40%) ▪ Assets: Otway Gas Plant (205 TJ/day capacity); Thylacine, Geographe, Speculant, Halladale and Black Watch gas fields; Enterprise, Artisan and La Bella gas
Slide 27: Bass Basin
Bass Basin Planning developments to increase production and extend asset life Asset overview ▪ Interests: 88.75% interest and operator of the Yolla field (Prize Petroleum 11.25%); 90.25% interest and operator of the Trefoil, White Ibis and Bass discoveries (Prize Petroleum 9.75%) ▪ Assets: Lang Lang
Slide 28: Taranaki Basin
Taranaki Basin Planning for development drilling in FY24 Asset overview ▪ Interest: 50% interest and operator (Genesis Energy 46%, NZOG 4%) ▪ Assets: Kupe Gas Plant (77 TJ/day capacity); Kupe gas field ▪ H1 FY23 production: 1.1 MMboe H1 FY23 progress ▪ No recordable safety incidents ▪ Continued subs
Slide 29: Western Flank oil and gas
Western Flank oil and gas Ongoing drilling and well connections Asset overview ▪ Interests: 100% interest and operator of PEL 91, PEL 104/111 and PEL 106; 75% interest and operator of PEL 92 (Cooper Energy 25%) ▪ Assets: Middleton Gas Plant (30 TJ/day capacity); 29 producing oil fields and 10 produc
Slide 30: Cooper Basin JV
Cooper Basin JV Five-rig drilling campaign underway Asset overview ▪ Interest: Various non-operated interests (Santos operator)1 ▪ Assets: Moomba Gas Plant 400 TJ/day capacity; ~190 producing oil and gas fields; depleted reservoirs for CCS ▪ H1 FY23 production: 3.4 MMboe H1 FY23 progress ▪ Participa
Slide 31: Key takeaways
F Y 2 3 H A L F Y E A R R E S U LT S Key takeaways
Slide 32: Key messages
Key messages Progressing and de-risking major growth projects Growing Growing Investing in Gas-supported Gas & LNG Strong FCF Future Growth transition ▪ Otway Thylacine first ▪ Targeting eight plants ▪ 12+ months of Perth ▪ 2050 net zero aspiration gas targeted by mid- supplying local and Basin expl
Slide 33: Appendix
F Y 2 3 H A L F Y E A R R E S U LT S Appendix
Slide 34: Other financial statement impacts
Other financial statement impacts Reconciliation of EBITDA and NPAT $ million H1 FY22 H1 FY23 Change Underlying EBITDA 513 491 (4%) Reversal of accrued acquisition costs – 17 EBITDA 513 508 (1%) Depreciation and amortisation (203) (207) Finance expenses (8) (16) Interest income 0 1 Tax (90) (79) Sta
Slide 35: Maximising output from existing gas facilities
Maximising output from existing gas facilities Growth strategy and project delivery support supply-constrained gas markets Perth Basin Otway Basin Bass Basin Taranaki Basin Cooper Basin Cooper Basin JV Western Flank Ownership 50%*,1 60%* 88.75%*,2 50%* ~35.2%3 ~100%*,4 Mitsui O.G. Energy Prize Petro
Slide 36: Beach Energy Limited contact details
Beach Energy Limited Level 8, 80 Flinders Street Adelaide SA 5000 Australia T: +61 8 8338 2833 F: +61 8 8338 2336 beachenergy.com.au Investor Relations Derek Piper, General Manager Investor Relations T: +61 8 8338 2833