Santos Limited · ASX:STO
Santos — FY2008 Earnings Presentation
21 slides from Santos's earnings presentation, Feb 19, 2009
Slide 1: 2008 Full Year Results
2008 Full Year Results 19 February 2009 1 Results Highlights & Strategy David Knox CEO & Managing Director 2 1
Slide 2: Strong operating performance; The Santos Strategy
Strong operating performance 2008 Full Year Result Change on 2007 Production 54.4 mmboe (8%) Sales Revenue $2.8 billion 11% EBITDAX $3.7 billion 99% Net Profit After Tax $1.7 billion 359% Underlying Net Profit $572 million 42% Operating Cash Flow $1.5 billion 21% Total Dividends 42 cents per share 5
Slide 3: Strategy delivery in 2008
Strategy delivery in 2008 Base Business – Australia & Indonesia Target Delivery Production 54 – 56 mmboe 54.4 mmboe in line with guidance Progress next phase of projects to schedule Kipper – on track for first gas 1H11 Oyong Phase 2 – on track for first gas 3Q09 Reindeer – market leading gas prices
Slide 4: Track record of reserves growth
Strategy delivery in 2008 Focussed Growth in Asia Target Delivery Vietnam: Chim Sao Successful test of Chim Sao North appraisal well Deferral of first oil into 2011 Bay of Bengal: progress exploration program 2D seismic survey complete 3D seismic survey underway 7 Track record of reserves growth 2P
Slide 5: Net profit after tax
2008 Full Year Results Peter Wasow Executive Vice President & CFO 9 Net profit after tax 2007 2008 2007 Significant Underlying Operating Underlying Significant 2008 Reported Items Profit Items Profit Items Reported $m 359 45 404 168 572 1,078 1,650 1,650 1,500 1,350 1,200 1,050 900 750 600 450 300 1
Slide 6: Underlying Profit; Significant items
Underlying Profit 2007 Exploration Interest 2008 Underlying Price Volume Prod costs DD&A Expense & FX Underlying $m 404 232 (101) (43) 12 28 40 572 650 575 500 425 350 275 200 2007 2008 11 Significant items 2008 2008 $m Pre tax Post tax Gain on PETRONAS sell down 1,698 1,188 Impairment write-downs (
Slide 7: 2009 guidance; Cash on hand $1.6bn, gearing 10%
2009 guidance Item 2009 Guidance 2008 Actual Production 53 – 56 mmboe 54.4 mmboe Production costs $550 - $570 $543 million million Depreciation, Depletion & $12.80 per boe $12.20 per boe Amortisation (DD&A) expense Royalty related taxation expense1 $80 to $100 $115 million (after million (after tax)
Slide 8: Long debt profile; 2008 Reserves
Long debt profile with high flexibility Debt Maturity Profile Less than 15% of gross debt 600 matures in next two years Average term to maturity 6.6 years 500 Greater than 25% matures beyond ten years 400 A$ millions All A$ debt and 87% of US$ 300 debt is floating rate 200 In addition, undrawn but c
Slide 9: GLNG: The leading CSG to LNG project
Looking Forward David Knox CEO & Managing Director 17 GLNG: The leading CSG to LNG project Environmental applications commenced Freehold land acquired for Pre-FEED by Foster liquefaction facilities Wheeler and Bechtel Significant project PETRONAS selected Environmental Impact status awarded as partn
Slide 10: GLNG: Building the team and reserves
GLNG: Building the team Growth in GLNG team to 220 employees Senior secondees from PETRONAS into GLNG including: - Project Director Downstream - GM LNG Operations - GM Marketing Plans for an additional 120 new employees in 2009 Organisation in place to deliver New Brisbane office opens mid- Howard K
Slide 11: PNG LNG on track; Disclaimer & Important Notice
PNG LNG on track Steady progress toward final investment decision… Pre FEED work on two train 6.3 mtpa plant Hides & Angore Marketing Representative Juha Agreement Kutubu & Agogo Gobe Coordinated Development and Operating Agreement Gas Agreement FEED Entry Decision LNG Plant Port Moresby Marketing &
Slide 12: Reference Slides: 2009 Forward Exploration Schedule
Reference Slides 23 2009 Forward Exploration Schedule Well Name Basin / Area Target Upside Resource Potential Santos Timing Comments (mmboe) Interest 50 - 100 - 0 – 50 % 100 500 Gulf of Suez / Drilling with South East July 1 Oil 40 Q1 09 Egypt full carry East Java / Peluang 1 Gas 67.5 Q1 09 Indonesi
Slide 13: Australia and LNG Milestones
Australia - Milestones Project 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 FEED FID Startup Fairview CSG 115 TJ/Day Henry Discovered FEED FID Startup (VIC/P44 July 2005 Stage 2) Discovered FID Startup Kipper 1986 Patricia- FEED Startup Pre-FEED FID Baleen Plant Upgrade Discovered FEED FID
Slide 14: Asia Milestones; Production
Asia - Milestones Project 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Discovered FEED FID Startup 2001 Oyong Ph2 FEED FID Startup Wortel Country Pre-FEED FID Startup Chim Sao Entry 2006 Dua Magnama, Hatia Wells 3D Seismic Country Bangladesh Entry 2007 2D Seismic 3D Seismic Exploration Wel
Slide 15: DD&A; EBITDAX
DD&A Lower Volume New Field Fields $m 2007 Fields Performance Events* Sold Other 2008 759 10 (39) (64) (1) (1) 664 770 750 730 *Events: 710 Mutineer Exeter (44) 690 Stag (6) Moonie-Brisbane pipeline (13) 670 John Brookes (1) TOTAL (64) 650 2007 2008 29 EBITDAX 2007 GLNG Production Gas 2008 EBITDAX S
Slide 16: Finance charges; 2008 Impairment write-downs
Finance charges 2008 2007 Change% Interest expense 132 129 Less borrowing costs capitalised (10) (6) 122 123 − Unwind of the effect of discounting on provisions 31 24 Other − 5 Financial expenses 153 152 − Less interest income (63) (14) Net financing costs 90 138 -35 31 2008 Impairment write-downs $
Slide 17: EBITDAX; Underlying profit
EBITDAX $m 2008 2007 Net profit after tax 1,650 359 Total tax expense 883 359 Net financing costs 90 138 Impairment write-downs 217 − Exploration expense 179 235 DD&A 664 759 EBITDAX 3,683 1,851 33 Underlying profit $m 2008 2007 Net profit after tax 1,650 359 Net gain sale GLNG assets (1,188) − Insu
Slide 18: 2009 Sensitivities; Prices & Exchange Rates
2009 Sensitivities NPAT Impact Sensitivity Change A$m US dollar oil price US$1/bbl 13 Gas Price 10 cent/GJ 14 A$/US$ exchange rate 1 cent 9 Interest rates 1% 8 35 Prices & Exchange Rates 2008 2007 Change % 1 Realised Oil Prices (USD/bbl) 98.99 80.35 +23 AUD/USD Exchange Rate (after hedging) 0.8428 0
Slide 19: Restatement of 2007 comparatives; FUELS hybrid issue
Restatement of 2007 comparatives Royalty Related Taxes Per financial Impact of new Restated report Interpretation amount 31 December 2007 Cost of sales 1,453 (118) 1,335 Profit before tax 601 118 719 Income tax expense 161 35 196 Royalty related tax − 164 164 expense Profit after tax 440 (81) 359 37
Slide 20: Reserves & Resources
Reserves & Resources PROVED PLUS PROBABLE RESERVES (SANTOS SHARE) BY ACTIVITY Sales gas (incl. Crude oil Condensate LPG Total ethane & LNG) mmbbl mmbbl 000 mmboe PJ tonnes Reserves year end 2007 4271 79 43 2982 879 Production -230 -10 -3 -251 -54 Additions 1536 14 2 258 280 Acquisitions/Divestments
Slide 21: Contact Information
Contact Information Registered and head office Andrew Nairn Share Register Group Executive Investor Relations Adelaide Level 10, Santos Centre Ground Floor, Santos Centre Direct: + 61 8 8116 5314 60 Flinders Street Facsimile: +61 8 8116 5131 Adelaide, South Australia 5000 Email: andrew.nairn@santos.