Santos earnings watch: 4 things to consider before half-year results

Here are the top four things investors should consider ahead of Santos's (ASX: STO) 2019 half-year results, set to be released to the market this Thursday, August 22.

When will Santos release its results?

Santos Ltd (ASX: STO) is set to release its 2019 half-year results this Thursday, August 22 at 11:00 AEST.

Santos share price: details in demand

Even though Santos Ltd has already released first and second quarter activities reports to the market, investors will likely be keen to gain a more in-depth understanding of the company’s financial performance, as well as its full-year outlook.

Previously, the company reported record first-half production figures of 37MMboe – which represents a 32% increase year-over-year.

In addition to this, Santos saw its sales volume hit 45.2MMboe, while its sales revenue also increased significantly, rising 18% to A$2 billion in 1H19.

Speaking of these results, Santos's Managing Director and CEO, Kevin Gallagher said:

'Our disciplined operating model and approach to capital allocation has delivered a strong first half result.’

The company however did not release earnings figures in its recent activities reports, something that current and prospective investors will likely be keen to gain further clarity on this Thursday.

Furthermore, in its latest activities report, the company reported that it generated an impressive $300 million in free cash flow in the second quarter – taking Santos’s first-half free cash flow to over $600 million.

Indeed, as the company was rightfully proud to point out:

‘Santos has now delivered positive free cash flow for thirteen consecutive quarters.'

Investors will also likely be keen to see further information on the company’s Dukas-1 project.

This project has previously faced delays, but nonetheless looks to be a promising venture.

2019 full-year guidance

Though the broader picture of Santos’s half-year results are mostly known – thanks to its Q1 and Q2 activities reports, investors will likely want to see further commentary regarding 2019 full-year guidance.

Santos’s CEO gave some indication on where FY19 performance may be heading when he noted that following planned maintenance works in Q2:

‘We currently expect stronger production in the second half.’

What this ‘stronger production’ means in more concrete terms will likely be of great interest to investors as we edge closer to the half-year results.

What do analysts think?

As it stands, Santos (ASX: STO) looks to be well liked by analysts.

According to the Wall Street Journal, the stock currently carries an overweight rating: with seven buy recommendations and five hold recommendations.

Santos has no sell recommendations.

The wealth management firm Morgans for example, even though they retain a hold rating on Santos, has pointed out that they, ‘are expecting much higher pcp 1H earnings from STO of A$468m.’

Year-to-date, Santos’s shares have outperformed the ASX 200 benchmark by a wide margin, rising 27% in that period.

IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.

Please see important Research Disclaimer.

Seize a share opportunity today

Go long or short on thousands of international stocks.

  • Increase your market exposure with leverage
  • Get spreads from just 0.1% on major global shares
  • Trade CFDs straight into order books with direct market access

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.


Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.

The Momentum Report

Get the week’s momentum report sent directly to your inbox every Monday for FREE. The Week Ahead gives you a full calendar of upcoming key events to monitor in the coming week, as well as commentary and insight from our expert analysts on the major indices to watch.

For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.