Full-year figures from Genel Energy (GENL) show an operating loss of $288m (£188m), against a profit of $184m in 2013. The reversal can be attributed to a $471m exploration write-off on prospects in Angola, Malta and Morocco. But the market's primary concern is the group's near-term cash generation. This point is borne out by a near-two-thirds decline in 2014 cash flows, despite a 49 per cent uplift in turnover.
Genel is the largest independent producer in the Kurdistan region of Iraq. It has experienced delays in receiving payments from the region's semi-autonomous governing body, the KRG. Yet that may be about to change. The Iraq budget was rubber-stamped in February, paving the way for the implementation of an interim oil deal between the KRG and the Iraqi authorities that should facilitate regular export payments in 2015.
There was also good news on the operational front. Net production increased to 69,400 barrels of oil per day (bopd), from 44,000 bopd in the previous year. Unlike many producers, Genel remains intent on driving up reserves. Capital expenditure for the year was up by a fifth to $677m, around half of which was employed on an unsuccessful multi-well exploration programme in Africa. Genel is looking to recommence work at its "highly prospective" Somaliland site early this year.
| GENEL ENERGY (GENL) | ||||
|---|---|---|---|---|
| ORD PRICE: | 516p | MARKET VALUE: | £1.3bn | |
| TOUCH: | 514.5-515.5p | 12-MONTH HIGH: | 1,100p | LOW: 516p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 1,498¢* | NET DEBT: | 0.1% | |
| Year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2011 | 24 | -58.0 | -72.3 | nil |
| 2012 | 333 | 76.0 | 27.2 | nil |
| 2013 | 348 | 187 | 66.2 | nil |
| 2014 | 520 | -313 | -113 | nil |
| % change | +49 | - | - | - |
Ex-div: na Payment: na £1 = $1.53 *Includes intangible assets of $1.68bn, or 676¢ a share | ||||
