Karoon Energy Ltd reported a solid first-half performance for 2026, with underlying net profit after tax of $29.2 million on revenue of $244.9 million, as production and pricing strengthened across its Brazilian and U.S. assets.
Operational efficiency improved, with the Baúna FPSO achieving 97% uptime in the second quarter, exceeding the company’s 90%-95% target range. Net production totaled 3.17 million barrels of oil equivalent on a working-interest basis, while realized oil prices averaged $80.66 per barrel—an 18% year-over-year increase. The company also reported zero recordable personal injuries across more than 1.1 million work hours during the period.
Financial discipline remained a priority, with total liquidity standing at AUD 363.6 million, including AUD 80.3 million in cash and an undrawn revolving credit facility of AUD 283.3 million. Gearing was 21% at June 30, with a debt-to-equity ratio of 0.33. Return on equity over the last twelve months reached 12%.
Karoon’s board declared a fully franked interim dividend of 1.2 Australian cents per share, payable on September 30, 2026, equating to a 3.18% yield. The company has returned approximately $173 million to shareholders since 2024, including $75 million in dividends and $98 million via on-market buybacks. Additional buybacks totaling AUD 15 million were executed between July 23 and August 7, bringing year-to-date repurchases to over AUD 30 million and 24 million shares.
Capital discipline underpinned project execution, with the Who Dat East development sanctioned in August 2026 and first oil targeted for the second half of 2028. The project is expected to deliver an internal post-tax return above 20%, with initial net production of about 6,000 barrels of oil equivalent per day to Karoon. The Who Dat G1 sidetrack is slated to commence drilling in the fourth quarter of 2026, with first production expected in early 2027. Meanwhile, the Who Dat A1 sidetrack came online in July, producing roughly 2,200 BOE per day on a net revenue interest basis.
Baúna guidance remains unchanged, though output is expected to track toward the lower end of the annual range due to delays in restoring the SPS-92 well. The company also highlighted structural cost reductions of $30 million to $40 million annually following the transition to self-operated Baúna FPSO management, eliminating lease payments and performance bonuses.
Shares of Karoon slipped 2.02% to $1.695, leaving the stock 24.9% above its 52-week low and 25% below its peak. The company trades at a P/E ratio of 7.3.
