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    BPT.AX · ASX · Energy

    Beach Energy Limited

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    AUD -0.26

    Market price

    AUD 0.87

    Implied upside

    -129.6%

    5-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case

    Wrong toolThis line has no market capitalisation, which means it is not ordinary shares - typically a hybrid, preference line, note or unlisted stub. A discounted cashflow values a claim on the whole business, so applying it here attributes all of the group’s revenue to a security that has no such claim. Its value is its coupon and call schedule. Look up the ordinary line instead.
    AdjustedSome line items were not reported and have been derived. Each one is labelled in the workings below.
    AdjustedFree cashflow is negative in at least one forecast year, so terminal value carries most of the valuation.
    AdjustedCapital expenditure runs at 52.5% of revenue against depreciation of 12.2%. A perpetuity has to be a steady state, so the terminal year uses maintenance capex at depreciation and then charges the reinvestment terminal growth requires (g/ROIC of NOPAT). The bridge is shown under Terminal Value.

    No usable EV/EBITDA (EBITDA is not positive), so the exit multiple falls back to 8x.

    Value Per Share

    Perpetuity growth
    AUD -0.26-129.6%
    Exit multiple
    AUD 0.21-75.9%
    Market price
    AUD 0.87

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (AUD). Outflows negative.

    -861836173-4309180870FY27FY28FY29FY30FY31
    Nominal FCFFDiscounted to todayAUD
    LineFY27FY28FY29FY30FY31CAGR
    RevenueAUD 2.0bnAUD 2.2bnAUD 2.3bnAUD 2.4bnAUD 2.6bn+5.9%
    EBITAUD 308.5mAUD 326.8mAUD 346.1mAUD 366.6mAUD 388.3m+5.9%
    NOPATAUD 218.3mAUD 231.2mAUD 244.9mAUD 259.4mAUD 274.8m+5.9%
    Add depreciation & amortisationAUD 248.7mAUD 263.4mAUD 279.0mAUD 295.5mAUD 313.0m+5.9%
    Less capital expenditureAUD -1.1bnAUD -1.1bnAUD -1.2bnAUD -1.3bnAUD -1.3bn+5.9%
    Less increase in working capitalAUD -82.8mAUD -87.7mAUD -92.9mAUD -98.4mAUD -104.2m+5.9%
    Free cashflow to firmAUD -684.8mAUD -725.3mAUD -768.2mAUD -813.7mAUD -861.8m-5.9%
    Discount factor0.96690.90400.84520.79020.7387-
    Present valueAUD -662.2mAUD -655.7mAUD -649.3mAUD -643.0mAUD -636.7m+1.0%
    Present Value Of The ForecastAUD -3.2bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate5.35%Australian Government 10-year (RBA F2)
    Equity risk premium6.00%Market assumption
    Beta0.328Reported -0.003, pulled toward 1.0 (Blume)
    Cost of equity7.32%Risk-free + beta x equity risk premium
    Cost of debt9.84%Interest expense / average total debt
    Market capitalisationAUD 0.000.0% of capital
    Total debtAUD 632.3m100.0% of capital, book value as a proxy
    Tax rate29.2%Effective, capped at statutory
    WACC6.96%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareAUD -0.26

    -1825% of EV

    Forecast FCFF, final year
    AUD -861.8m
    Capex at depreciation, working capital in reinvestment
    AUD 274.8m
    Less reinvestment at g/ROIC (34.0% of NOPAT)
    AUD -93.4m
    Capitalised
    AUD 181.3m
    ROIC (reported)
    7.4%
    Terminal value, undiscounted
    AUD 4.2bn
    Terminal value, discounted
    AUD 3.1bn
    Enterprise value
    AUD -168.6m
    Less net debt
    AUD 419.3m
    Equity value
    AUD -587.9m

    Exit at 8.0x EBITDA

    Value per shareAUD 0.21

    462% of EV

    Terminal value, undiscounted
    AUD 5.6bn
    Terminal value, discounted
    AUD 4.1bn
    Enterprise value
    AUD 897.8m
    Less net debt
    AUD 419.3m
    Equity value
    AUD 478.5m

    Sensitivity

    Value per share (AUD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    4.96%0.580.750.991.331.92
    5.96%0.040.100.170.270.40
    6.96%-0.29-0.27-0.26-0.24-0.21
    7.96%-0.49-0.48-0.48-0.47-0.46
    8.96%-0.62-0.61-0.61-0.60-0.60

    Outlined: this model. Green text: above today's price of 0.87. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputModelImpliedGap
    Revenue growth, every year5.9%62.5%+56.5pp
    EBIT margin15.2%24.7%+9.5pp
    Discount rate7.0%5.1%-1.9pp
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.