The Karoon Energy Ltd (ASX: KAR) share price is sinking on Thursday following the release of the company’s full-year results.
In early afternoon trade, the oil and gas producer’s shares are down 4.28% to $1.565.
Let’s take a closer look at what was reported for the year ended 31 December 2025.
Profit eases as oil price softens
Karoon generated sales revenue of US$628.6 million in 2025, down from US$776.5 million in the prior year. The decline reflected lower realised oil prices and slightly lower sales volumes.
Underlying EBITDAX came in at US$388.8 million, down 21% year on year.
Underlying net profit after tax (NPAT) was US$107.5 million, compared with US$214 million in 2024. Statutory NPAT was US$125.5 million.
Despite the earnings decline, unit production costs improved. On a net working interest basis, costs fell 3% to US$13.20 per barrel of oil equivalent (boe).
Production steady, efficiency improves
Total production for the year was 10.3 million boe, broadly in line with 2024.
The Bauna Project in Brazil contributed 7.7 million barrels of oil equivalent (MMboe), while Who Dat in the US delivered 2.6 MMboe.
Bauna FPSO efficiency improved to 95.1%, up from 84.5% in 2024. During the year, Karoon completed the acquisition of the Bauna FPSO.
At Who Dat, production remained in line with expectations, with the E6ST sidetrack brought online in the fourth quarter.
Reserves also increased. Proved and probable reserves rose 7% to 72.8 MMboe, while 2C contingent resources increased 34% to 163 MMboe.
Strong cash flow and balance sheet
Karoon reported operating cash flow of US$251.4 million.
Liquidity at 31 December 2025 stood at US$546.1 million, including US$206.1 million in cash and access to its reserves-based lending facility.
Net debt at year end was US$143.9 million.
During the year, the company returned US$80.4 million to shareholders through dividends and share buybacks.
The board declared a final dividend of 3.1 cents per share, fully franked. This brings the total 2025 dividends to 5.5 cents per share.
Shares will trade ex-dividend on 5 March 2026, and payment is scheduled for 31 March 2026.
2026 expected to be a transition year
Karoon expects total production in 2026 to be between 8.1 and 9.2 MMboe.
Guidance reflects planned investment and maintenance activities in the first half, which management has described as a year of two halves.
Unit production costs are forecast at US$12 to US$15 per boe.
Total capital expenditure is expected to range between US$110 million and US$135 million.
Management said planned investment and maintenance work will reduce production in the first half of 2026. Higher output is expected in the second half, subject to oil prices and how smoothly operations run.
The post Why the Karoon Energy share price is falling today appeared first on The Motley Fool Australia.
Should you invest $1,000 in Karoon Energy Ltd right now?
Before you buy Karoon Energy Ltd shares, consider this:
Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Karoon Energy Ltd wasn’t one of them.
The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*
And right now, Scott thinks there are 5 stocks that may be better buys…
* Returns as of 20 Feb 2026
.custom-cta-button p {
margin-bottom: 0 !important;
}
More reading
- 5 things to watch on the ASX 200 on Tuesday
- Here are the top 10 ASX 200 shares today
- 5 things to watch on the ASX 200 on Tuesday
- 5 things to watch on the ASX 200 on Tuesday
- 5 things to watch on the ASX 200 on Tuesday
Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.