Shares in Circle Oil (COP) shifted into reverse on the release of mixed full-year figures. The steep fall-away in energy prices has taken the gloss off the driller's continued exploration success in North Africa, which included an increase in reported reserves. The company posted an operating loss of $48m (£31.2m) in 2014, against a profit of $32.3m in the previous year, due to upwards of $71m in write-offs.
A $57.4m charge followed management's decision to relinquish two permits in Oman, while falling oil prices prompted a $13.9m impairment on the NW Gemsa permit in Egypt. Circle was also on the wrong side of foreign exchange translations through the year.
The good news is that Circle continues to deliver solid production levels. Gas output from Morocco was broadly similar to last year, while gross oil production declined marginally from the maturing NW Gemsa field. Yet an independent Competent Person's Report revealed a 7 per cent increase in proved and probable (2P) reserves to 36.3m barrels of oil equivalent.
Looking ahead, Circle intends to review field management in Egypt ahead of more drill-work in 2015, while moving ahead with drilling programmes on the Sebou and Lalla Mimouna permits in Morocco. In Tunisia, Circle awaits government approval to start the next exploration phase on the highly promising Mahdia permit - a key target.
| CIRCLE OIL (COP) | ||||
|---|---|---|---|---|
| ORD PRICE: | 12.25p | MARKET VALUE: | £69m | |
| TOUCH: | 12-12.5p | 12-MONTH HIGH: | 29p | LOW: 9p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 34¢ | NET DEBT: | 31% | |
| Year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 44.4 | 10.4 | 2.2 | nil |
| 2011 | 58.0 | 25.6 | 4.6 | nil |
| 2012 | 73.3 | 25.3 | 4.5 | nil |
| 2013 | 93.3 | 28.9 | 5.1 | nil |
| 2014 | 84.6 | -53.9 | -9.6 | nil |
| % change | -9 | - | - | - |
Ex-div: - Payment: - | ||||
