Beach Energy shares plunge on $674 million impairment hit

Highlights:

• Beach Energy (ASX: BPT) shares down 9.1% to $1.17 following a massive writedown announcement.
• $674 million pre-tax impairment driven by lower long-term commodity price assumptions.
• Company assures no impact on operations or liquidity despite the accounting loss.

Impairment Announcement Sparks Sell-Off

Shares of Beach Energy Limited (ASX: BPT) tumbled 9.1% to $1.17 at the time of writing, making it the worst-performing stock on the ASX 200 today. The sharp decline came after the oil and gas producer revealed it expects to book a non-cash impairment charge of $674 million in its FY25 financial results. The after-tax impact of the writedown is forecast to be around $474 million, largely attributed to revised assumptions around commodity prices.

Commodity Price Decline Drives Revision

Beach Energy said the impairment stems from a re-evaluation of key assets due to falling oil and gas prices, which has significantly impacted the company’s longer-term cash flow projections. The downgrade reflects a shift in global energy markets, where price volatility and softening demand are challenging upstream producers.

No Impact on Cash Flow or Operations

Despite the large impairment, Beach Energy emphasised that the charge is non-cash and will not affect day-to-day operations or near-term cash flow. The company reiterated its commitment to advancing major projects, including Waitsia Stage 2 and Perth Basin developments.

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