Shares of Beach Energy Ltd (ASX: BPT), a key player in the S&P/ASX 200 Index, are facing downward pressure, falling 4.3% to $1.45 during Thursday morning trade after closing at $1.52 the previous day. This drop comes despite the broader ASX 200 Index showing a gain of 0.8%.
The decline in Beach Energy’s stock is largely attributed to a significant slump in global oil prices overnight. Brent crude dropped 2.0%, reaching $74.68 per barrel as market sentiment reacts to U.S. President Donald Trump’s diplomatic overtures to Iran and his reconstruction plans for Gaza. As a result, the S&P/ASX 200 Energy Index (ASX: XEJ) is also down 0.7%.
Strong Half-Year Results Can’t Prevent Stock Decline
Beach Energy’s share price is under pressure despite the company’s robust half-year financial results for FY 2025. Investors had high expectations following a solid performance, but it wasn’t enough to stave off the stock’s dip.
For the first half of FY 2025, Beach Energy reported production of 10.2 million barrels of oil equivalent (MMboe), marking a 15% increase compared to the previous year. The company attributed this growth to strong operational performance.
Sales revenue for the period rose 5% year-on-year to $990 million, boosted by the contribution of two Waitsia LNG swap cargoes, which generated $139 million in revenue. Additionally, underlying earnings before interest, taxes, depreciation, and amortization (EBITDA) rose 20% to $587 million.
Beach Energy also benefited from a significant increase in its average realized gas price, which surged 18% to $10.50 per gigajoule (GJ). As a result, underlying net profit after tax (NPAT) for the half-year jumped 37% to $237 million.
For passive income investors, the company declared a fully franked interim dividend of 3.0 cents per share, a 50% increase from last year, supported by higher free cash flow and improved liquidity.
On the balance sheet, Beach Energy showed an 88% increase in operating cash flow to $659 million, while net debt dropped 33% to $389 million. The company also reported holding $631 million in cash reserves and undrawn committed facilities as of December 31.
Despite these solid financials, Beach Energy’s stock is clearly feeling the weight of external market pressures.
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