Santos Ltd (ASX: STO) shares are under pressure on Wednesday after the energy giant released its full-year results for 2025.
At the time of writing, the Santos share price is down 1.50% to $6.57.
While the company delivered solid operational and financial performance, income investors will likely be most interested in its latest dividend update.
Here's everything you need to know.
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Santos' FY25 dividend at a glance
Santos has declared a final dividend of 10.3 US cents per share.
This brings total dividends for FY25 to 23.7 US cents per share. That's up from 23.3 US cents last year and marks another year of disciplined capital returns.
The dividend will be paid in US dollars.
Key dates to note are:
• Ex-dividend date: 23 February 2026
• Record date: 24 February 2026
• Payment date: 25 March 2026
The dividend is 100% unfranked.
Based on the current share price of $6.57, the stock is trading on a trailing yield that remains competitive within the ASX energy sector. Investors should remember that payments are declared in US dollars, meaning the final amount received in Australian dollars will depend on exchange rates.
Backed by strong cash flow
The dividend was underpinned by solid free cash flow generation despite lower realised commodity prices.
For FY25, Santos reported:
• Free cash flow of US$1.8 billion
• Underlying profit of US$898 million
• EBITDAX of US$3.4 billion
The total dividends declared for the year came in at around US$770 million.
Santos finished the year with gearing of 26.9%, or 21.5% excluding leases, signalling balance sheet strength at the end of a peak capital investment phase.
Unit production costs came in at US$6.78 per barrel of oil equivalent. That marks the lowest level in a decade and highlights management's focus on cost discipline.
Dividend growth despite major project spend
One of the more notable takeaways is that Santos has grown dividends while progressing two major development projects, Barossa and Pikka Phase 1.
Management highlighted that dividends per share have delivered a 13.6% compound annual growth rate since 2018. That expansion has occurred alongside the company's large-scale investment, including Barossa and the Moomba carbon capture and storage project.
With Barossa and Pikka ramping up, Santos expects production of 101 to 111 mmboe in 2026. It continues to target at least 60% of all-in free cash flow to be returned to shareholders over time.
Foolish takeaway
Today's share price decline suggests the market may have been hoping for a stronger result or larger capital return.
However, Santos continues to position itself as a disciplined, cash-generating energy producer focused on shareholder returns.
While commodity prices will always influence future payouts, Santos' low-cost operating model and improving free cash flow breakeven metrics support its outlook. Its strengthened balance sheet also suggests it remains well placed to continue rewarding investors.
