Woodside Energy Group Ltd ((WDS)) has held its Q4 earnings call. Read on for the main highlights of the call.
Woodside Energy Group Ltd’s recent earnings call conveyed a strong financial and operational performance, marked by significant progress on major projects and strategic initiatives. However, the call also highlighted some challenges, particularly in safety and regulatory areas, which remain a concern for the company.
Record Annual Production
Woodside achieved a record annual production in 2024, reaching 194 million barrels of oil equivalent. This achievement places the company at the top end of their full-year guidance range, showcasing their operational efficiency and capacity to meet production targets.
Significant Financial Performance
The company reported a net profit after tax of $3.6 billion, reflecting a substantial increase from the previous year. Earnings per share rose to U.S. 189 cents, indicating robust financial health and effective cost management.
Dividend and Cost Efficiency
Woodside declared a fully franked total full-year dividend of U.S. 122 cents per share, aligning with the top of their payout range. Additionally, the company managed to reduce unit production costs to $8.10 per barrel of oil equivalent, demonstrating a focus on cost efficiency.
Progress on Major Projects
The Scarborough project is 80% complete and on track for its first LNG cargo in 2026. The Trion project is also progressing well, with first oil expected in 2028. The Sangomar project has already exceeded early production performance expectations.
Investment in Climate Commitments
Woodside has made strides in reducing net equity Scope 1 and 2 emissions by 14% below the starting base. Strategic acquisitions, such as Beaumont New Ammonia, are part of their efforts to meet climate targets.
Successful Strategic Partnerships
Woodside welcomed strategic partners LNG Japan and JERA to the Scarborough joint venture, highlighting the company’s ability to attract high-quality partners and enhance project value.
Strong Market Position
Positioned to meet global energy demands, Woodside focuses on LNG as a crucial element in the energy transition, aiming to drive shareholder value and maintain a competitive edge.
Community and Economic Contributions
The company invested $7.9 billion in local economies and significantly contributed to government revenues, ranking as the fifth largest taxpayer in Australia.
Safety Challenges
The tragic death of a construction contractor employee at the Beaumont New Ammonia project underscored ongoing safety challenges that the company needs to address.
Approval Delays
Federal approval delays for the Northwest Shelf project life extension have impacted confidence in future investment decisions, posing a challenge for the company’s strategic planning.
Uncertainty in U.S. Oil Production
A modest 2P reserve cut to the Mad Dog project and concerns over subsurface challenges have introduced some uncertainty in U.S. oil production prospects.
Forward-Looking Guidance
CEO Meg O’Neill emphasized Woodside’s strong performance, driven by record production and financial gains. The company anticipates a compound annual growth rate of 4% to 5% in portfolio sales from 2024 to 2030, driven by robust LNG demand, particularly in Asia. These efforts are expected to generate significant free cash flow over the next decade, supported by strategic acquisitions and partnerships.
In summary, Woodside Energy Group Ltd’s earnings call highlighted a strong financial and operational performance, with record production and significant project progress. Despite challenges in safety and regulatory areas, the company’s strategic initiatives and market positioning suggest a promising outlook for future growth and shareholder value.