Woodside FY profit slumps

Miner hit by lower gas prices, says corporate strategy progressing well.

Woodside Petroleum (WES) says its corporate strategy is progressing and overseas growth is on the cards, after posting a slump in full-year profit.

For the twelve months to December 31, the miner booked a net profit of $1.75 billion, down 41.4% from the previous year which was inflated by revenue from its Browse stake sale.

The result was also hit by a higher proportion of lower priced gas and $US387 million in impairment charges against some mature oil assets, Woodside chief executive Peter Coleman said.

But the profit, which fell largely in line with analyst expectations, was still the second-largest in the miner's history.

Meanwhile, revenue from ordinary activities also fell, by 6.6% in the year to $5.93 billion.

The miner will pay a final dividend of $US1.03 on March 26, to shareholders on the record at February 28. The dividend, which brings total distributions for the year to $US2.49, up from $US1.30 in the previous year, will be fully franked for Australian tax purposes.

A strong dividend had been flagged last month when the company revealed it would collect a $US200 million to $US250 million petroleum resource rent tax benefit and had enjoyed a surge in revenue due to price rises at its Pluto LNG project in Western Australia.

Meanwhile, Woodside reaffirmed production guidance of 86-93 MMboe for 2014.

"Growth opportunities in Ireland, Myanmar, New Zealand, Canada and Israel demonstrate a clear link between our capabilities and future value," Mr Coleman said.

At the same time, it has reduced investment expenditure by 52% to $US851 million which, it said, demonstrated a rigorous approach to capital management.

Net debt was down 20% to $US1.54 billion, with gearing - a measure of equity-capital to borrowings - a low 9.0%, down from 11%.

Woodside had generated free cash flow in 2013 of $US2.27 billion and $5.91 billion in the last two years.

"This has enabled us to pay back debt and reward our shareholders through increased dividends," Mr Coleman said.

Importantly, it also provides the financial base for our next phase of growth."

Related Articles