In its first full year as a publicly-listed company, Genel Energy (GENL) boosted reserves, matched guidance in terms of production, and generated enough cash to fund its principal operations in Kurdistan. Nevertheless, the political situation between Iraqi authorities and the Kurdistan Regional Government (KRG) remains a potential stumbling block.
Although comparative measures are largely academic, Genel's working interest in production averaged 44,500 barrels of oil per day (bopd), a 6 per cent rise on 2011, and in line with expectations. Guidance is for production of 45,000-55,000 bopd in 2013 and revenues of between $300m and $400m (£199m-£265m), although this will be dependent on the level of export. On 2012 sales, Genel reported gross profits of $125m on a profit margin of 37 per cent - high by industry standards.
An appraisal at the Tawke field in Kurdistan was largely responsible for an 8 per cent rise in Genel's proven and probable reserves to 445m barrels of oil equivalent (boe). The reserve replacement ratio stood at 356 per cent, although a lofty rate is to be expected as Genel grows its resource base. Genel is targeting over 750m boe in gross unrisked resources through four wells in Kurdistan this year, while construction of a key export pipeline to Turkey is also moving ahead.
Credit Suisse expects 2013 EPS of 50¢ (27.2¢ in 2012), rising to 61¢ in 2014.
| GENEL ENERGY (GENL) | ||||
|---|---|---|---|---|
| ORD PRICE: | 757p | MARKET VALUE: | £2.1bn | |
| TOUCH: | 753-757p | 12-MONTH HIGH: | 881p | LOW: 586p |
| DIVIDEND YIELD: | nil | PE RATIO: | 42 | |
| NET ASSET VALUE: | 1,396¢* | NET CASH: | $1bn | |
| Year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2011 | 24 | -57.7 | -72.3 | nil |
| 2012 | 333 | 75.9 | 27.2 | nil |
| % change | +1288 | - | - | - |
*Includes intangible assets of $1.2bn, or 418¢ a share £1=$1.51 | ||||
