Earnings previews for Woodside, Santos, Karoon, Ampol, Viva, Whitehaven and other ASX energy stocks

Hands down, the S&P/ASX 200 Energy Sector Index (XEJ) has been the worst of the 11 major ASX sector indices over the last 12 months. On a total return basis, that is accounting for capital return and dividends, its 17% loss is around 10% behind that of the next-worse performer the S&P/ASX 200 Materials Sector Index (XMJ), and it’s a whopping 32% behind the +15% return delivered by the All Ordinaries Total Return Index*.

Some investors may automatically link the plunge in ASX energy shares with a buying opportunity, that is, lower share prices represent greater value. This is a potentially dangerous link to make when one considers that share prices don’t move by accident. Almost invariably, share prices move in response to changes in expected future earnings.

Assuming this is the case, we must associate the decline in ASX energy shares over the last 12 months with progressively declining earnings expectations. The graphic below from major broker Macquarie, suggests this has largely been the case – and it only shows earnings per share (“EPS”) revisions over the last 3-months.

The earnings of ASX-listed energy shares as a group have been slashed by around 18% since late 2024. In this context, their poor share price performance should not be a surprise. Moving forward, whether energy shares are indeed cheap will depend on the market’s perception of their earnings over the next 12 months, and beyond.

If the major fund managers perceive there’ll be a pick-up in Energy sector earnings, then their share prices will rise, but similarly, continued expectations of lower earnings will likely result in another year of poor performance.

That’s why the upcoming February earnings season is likely to be so important for the energy shares in your portfolio. It will shape the expectations of their earnings going forward, and therefore how the market responds in terms of share price gains or (further) losses.

In this article, we’ll check out the key numbers and pressure points for the upcoming earnings releases of the major constituents of the XEJ. We’ll tackle them in order of their scheduled earnings release, starting with oil and gas producer Santos.

Santos (ASX: STO)

Report/Reporting Date: Full Year 2024, 19 February

Company Description: An upstream oil and gas producer with a strong focus on liquefied natural gas (LNG) assets in Papua New Guinea, Australia, and Alaska. Santos is committed to achieving net-zero emissions by 2040, leveraging carbon capture and storage (“CCS”) hubs to drive its decarbonisation efforts. The company aims to deliver increasing cash flow (“FCF”) to shareholders once key projects including Barossa and Pikka are operational and gearing falls within its target range.

Key Earnings Data Forecasts:

• Total Revenue – US$5,457 million
• Underlying EBITDA^ – US$3,703 million
• NPAT^^ – US$1,374 million
• EPS – US$0.404 (approx. A$0.65)
• DPS** – US$0.223 (approx. A$0.36) unfranked

Key Earnings Pressure Points:

• Pre-growth FCF of around US$1.9b; payout ratio is greater than 40% of pre-growth FCF
• Initiation of a share buyback
• FY25 guidance of 90-97 million barrel of oil equivalent (“MMboe”) production and US$2.4-2.6b in capital expenditures (“CAPEX”)
• Details on 2025 cost reduction plan and progress updates on Pikka 2, Papua LNG, Bayu-Undan CCS, and Dorado projects

Viva Energy (ASX: VEA)

Report/Reporting Date: Full Year 2024, 19 February

Company Description: An integrated fuel refining, distribution, and retail/convenience business, supplying approximately 25% of Australia's fuel needs. Ampol is expanding its footprint in convenience retail, having acquired Coles Express (700+ sites) and OTR Group (226 sites), with plans to complete the buyout of Liberty Convenience (88 sites). Its Geelong petrochemical refinery has capacity of 120,000 barrels per day. Ampol is exploring opportunities in renewable fuels.

Key Earnings Data Forecasts:

• Total Revenue – $27,895 million
• Underlying EBITDA – $810 million
• NPAT – $304 million
• EPS – $0.195
• DPS – $0.028 fully franked

Key Earnings Pressure Points:

• Increasing levels of gearing vs potential impact on dividends
• Geelong refinery restart update
• Finalisation of Liberty Convenience sites price
• Outlook guidance for beyond FY25

Whitehaven Coal (ASX: WHC)

Report/Reporting Date: H1 FY2025, 20 February

Company Description: A coal producer operating three open cut and one underground mines in NSW. Primarily high-quality thermal coal; some semi-soft coking coal. Processed coal is exported from Newcastle Port to Asian markets. Whitehaven is advancing several expansion projects including the Vickery extension (open cut), Winchester South metallurgical coal (QLD), and the Narrabri extension. These extensions could extend the company’s total mine life by 15 years.

Key Earnings Data Forecasts:

• Total Revenue – $3,179 million
• NPAT – $52 million
• EPS – $0.21
• DPS – $0.05 fully franked

Key Earnings Pressure Points:

• Confirmation of FY25 production guidance (35.0 - 39.5Mt) and costs (A$140 - $155/t)
• Update on scheduled shutdown and maintenance at Narrabri
• Update on QLD productivity improvements
• Update on Nippon Blackwater sell-down
• Update on expected improvement in Daunia average coal specification

Paladin Energy (ASX: PDN)

Report/Reporting Date: H1 FY2025, 21 February

Company Description: A uranium producer via a 75% stake in the Langer Heinrich mine (“LHM”) in Namibia, a globally significant operation targeting 6Mlb U3O8 p.a. production. LHM is currently in the ramp-up phase following the restart of the project in 2024. The mine has an estimated 17-year life and is positioned to benefit from rising global nuclear energy demand. Paladin also owns 100% of the Patterson Lake South (PLS) uranium project in Canada’s Athabasca Basin uranium region, along with a portfolio of exploration and development assets across Canada and Australia.

Key Earnings Data Forecasts:

• Total Revenue – $156 million
• NPAT – $37 million
• EPS – $0.07
• DPS – n/a

Key Earnings Pressure Points:

• LHM production ramp-up progress (and potential FY26 guidance)
• Update on settlement of 200klb loan arrangement
• Update on Patterson Lake South development project (provincial approvals, potential commercial partner and offtake agreement)
• Michelin revised study update

Ampol (ASX: ALD)

Report/Reporting Date: Full Year 2024, 24 February

Company Description: Australia and New Zealand’s largest integrated fuels and energy company, supplying approximately 24 billion liters of fuel annually through an extensive refining, storage, and distribution network. The company’s Trading and Shipping operation transports both imported fuel products and crude for refining at the company’s Lytton Refinery in Brisbane, as well as exporting the company’s refined products.

Other infrastructure includes 24 fuel terminals, as well as a network of approximately 2,400 retail sites, many utilising the convenience store format. Ampol is investing in energy transition initiatives, including the establishment of Australia’s biggest EV charging network, as well as ongoing developments in hydrogen fuel solutions and biofuels.

Key Earnings Data Forecasts:

• Total Revenue – $34,756 million
• Underlying EBITDA – $1,226 million
• NPAT – $266 million
• EPS – $1.11
• DPS – $0.02 fully franked

Key Earnings Pressure Points:

• Increasing levels of gearing vs potential impact on dividends
• Update on impacts of recent planned maintenance at Lytton Refinery
• Improvement in Lytton Refiner Margin

Woodside Energy (ASX: WDS)

Report/Reporting Date: Full Year 2024, 25 February

Company Description: A global energy producer specialising in LNG operations and deepwater oil and gas production. Its key assets span Australia, the US (offshore Gulf of Mexico), Trinidad & Tobago, and Senegal. The company is advancing major developments, including the Scarborough and Pluto Train 2 LNG projects in Australia (targeting first LNG in 2026) and the Trion deepwater oil project in Mexico (targeting first oil in 2028). Additionally, Woodside is expanding into low-carbon solutions with the Louisiana LNG and Beaumont clean ammonia projects.

Key Earnings Data Forecasts:

• Total Revenue – US$12,923 million
• Underlying EBITDA – US$9,578 million
• NPAT – US$3,035 million
• EPS – US$1.642 (approx. A$2.62)
• DPS – US$0.625 (approx. A$1.00) fully franked

Key Earnings Pressure Points:

• FY25 guidance of 186-196MMboe production and US$2.4-2.6b capex
• Progress updates on Beaumont New Ammonia, Scarborough, Trion, Louisiana LNG final investment decision (“FID”), and initiatives in energy transition projects.

Boss Energy (ASX: BOE)

Report/Reporting Date: H1 FY2025, 26 February

Company Description: An emerging uranium producer focused on in-situ recovery (ISR) mining at operations in Australia and the United States. The company’s flagship Honeymoon uranium mine in South Australia is ramping up to a targeted annual production of 2.45Mlb U3O8 p.a. by FY27. Honeymoon has an initial mine life of just over 10 years, with potential extensions likely by adding satellite deposits at Gould’s Dam and Jason’s.

The company also has a 30% stake in the Alta Mesa project in Texas, operated by equity partner enCore Energy. Alta Mesa is expected to produce 1.5Mlb U3O8 p.a. by the end of 2026. Boss is well-positioned to benefit from rising uranium demand, driven by global efforts to expand nuclear energy, and holds a strong cash balance of over $250 million and a strategic inventory of 1.25Mlb U3O8 to support growth initiatives. Honeymoon is one of the world’s lowest-cost ISR uranium producers, with an estimated all-in sustaining cost (AISC) of around US$25/lb, enhancing its competitiveness in a strengthening uranium market.

Key Earnings Data Forecasts:

• Total Revenue – $107 million
• EPS – $0.10
• DPS – n/a

Key Earnings Pressure Points:

• Confirmation of FY25 production guidance and costs
• Update on IX column completion
• Update on resource upgrade
• Update on callback of Encore loan

Karoon Energy (ASX: KAR)

Report/Reporting Date: Full Year 2024, 27 February

Company Description: An oil and gas exploration and production company focussed on its 100%-owned and operated Baúna and Patola offshore production area in Brazil’s Santos Basin. Since taking ownership of the project in 2020, Karoon has significantly increased production, with Baúna expected to produce approximately 25,000 barrels of oil per day. The company is also advancing the nearby Neon and Goiá fields, which offer potential for a standalone development. Karoon recently acquired a 30% stake in the LLOG-operated Who Dat project in the Gulf of Mexico in the USA. Who Dat is a producing deepwater oil field with long-life reserves and additional upside potential.

Key Earnings Data Forecasts:

• Total Revenue – US$776.7 million
• Underlying EBITDA – US$499.5 million
• NPAT – US$201 million
• EPS – US$0.252 (approx. A$0.40)
• DPS – US$0.03 (approx. A$0.048) fully franked

Key Earnings Pressure Points:

• Update on share buybacks / proposed $75 million share buyback
• FY25 guidance 9.0-10.5MMboe production and US$99-117m capex
• Update on Baúna FPSO acquisition from Altera & Ocyan

New Hope Corporation (ASX: NHC)

This article first appeared on Market Index on Tuesday 11 February 2025.