Im a STO Shareholder - Get me outa here, page-14

"and they will have to go back to market for another CR this year."

corvet, a serious question, what is your reasoning behind your bold claim that Santos will have to do another CR this year, 2016?
Are you simply a non-holder keen to down-ramp Santos or do you dispute some of CEO Gallagher's, CFO Andrew Seaton and David Lennox's comments and predictions to the CourierMail below?

"...Santos has slashed almost 1000 jobs in the past 18 months as it reduces costs.

New chief executive Kevin Gallagher said he was not in a position to say exactly where and what cost cutting would be implemented in 2016, having only been in the job a few weeks. “My focus in the short term is to scrutinise our operations and identify those levers,” Mr Gallagher said.

Chief financial officer Andrew Seaton said Santos was focused on living within its means. “On a multitude of fronts, the Santos that you see in 12 months time will be quite different,” he said.

The current weakness in oil prices was part of a cycle, rather a structural shift in the industry, Mr Gallagher added.
“Following any period of high oil prices, we reach an oversupply situation and prices crash back to historically low levels and that’s what we’re seeing now,” he said. Santos predicts oil prices will rise to $US40 a barrel in 2016, $US60 in 2017 and $US70 in 2018.

The company will not have to reduce debt in 2016 if the oil price stays above its break-even cost of $US32 a barrel.

Benchmark US crude oil currently trades at around $US34 a barrel.

Santos has net debt of $6.5 billion, and is focused on strengthening its balance sheet, slashing capital expenditure to $1.1 billion and improving its operating efficiency.

“Santos is well placed to withstand an extended period of low oil prices,” the company said. With more than $4.8 billion in cash and committed undrawn debt facilities and no debt maturities until 2019, it does not foresee any issues with its debt covenants.

The company’s underlying profit in the year ended December 31 plunged 91 per cent to $50 million, as sales revenue dropped 20 per cent, even with higher production. Santos cut its fully-franked final dividend to 5¢, from 15¢ a year earlier.

Fat Prophets resources analyst David Lennox said the company’s move to raise equity in 2015 was the right thing to do. “If you removed that $3 billion in equity raising their balance sheet would have been very stretched,” Mr Lennox said. He said the company still had room to reduce costs but debt was not out of control.

http://www.couriermail.com.au/busin...n/news-story/97b3ce45871be64ca132bf5de75f1d12