-- Beach Energy's (ASX:BPT) fiscal third-quarter results included lower-than-expected production and a cut to guidance, prompting Euroz Hartleys to revise its output forecast for the company to the mid-point of updated guidance, the equity research firm said in a Wednesday note.
Euroz Hartleys noted, however, that the Waitsia project's production run-rate and Otway Basin customer nominations through the fiscal fourth quarter offer potential upside to the upper end of the company's guidance.
Beach Energy on Tuesday revised its fiscal year 2026 production guidance to between 19.4 million and 20.3 million barrels of oil equivalent from a previous range of 19.7 million to 22 million barrels of oil equivalent.
Additional disclosure on Waitsia swap arrangements has provided a clearer outlook, triggering increases in the equity research firm's fiscal year 2027 to fiscal year 2029 earnings forecasts. Euroz Hartleys previously modelled all swaps as to be returned in-kind, but now noted that more than half of them are sell-back arrangements that earn revenue.
It maintained a hold recommendation on Beach Energy while lowering its price target to AU$1.15 per share from AU$1.18, based on an updated sum-of-the-parts valuation.
Beach Energy shares fell 1% in recent Wednesday trade.