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Rough 2016 well behind President Energy

Last year was a rocky one for President Energy, but the picture has moved on
June 6, 2017

On 2 June, President Energy (PPC) released audited results for its last financial year, 153 days after the period-end. Many investors - including chairman Peter Levine - might count 2016 as a time to forget, but the belatedness of this filing begs the question as to why companies should bother posting their figures at all.

IC TIP: Buy at 6.5p

The headlines are fairly meaningless now. Group production edged up 3 per cent to 506 barrels of oil equivalent per day on the 2015 numbers, but has now more than doubled as President's work-over programme continues to target 1,200 barrels from Argentina alone by the end of September. Low-cost, low-volume production from Louisiana, which witnessed natural declines and operational issues in 2016, has now shifted thanks to April's acquisition of seven years' worth of production equivalent to 150 barrels a day, for a total consideration of up to $2.65m (£2.05m).

The big surprise for analysts was the one-off impairment charge of $10.9m related to the operational disaster at the DP-1002 S/T well at Dos Puntitas, which led to a cash shortfall and precipitated November's equity fundraising and loan restructuring. While that led to a big dent in the profit and loss account, the company is pursuing legal claims against the Argentine subsidiaries of Weatherford International and Helmerich & Payne.

On average, analysts expect pre-tax profits of $1.95m and zero EPS for the December year-end, against losses of $6.8m and 1.2¢ per share in 2016.

PRESIDENT ENERGY (PPC)

ORD PRICE:7pMARKET VALUE:£62m
TOUCH:6.5-7p12-MONTH HIGH:14pLOW: 5.5p
DIVIDEND YIELD:nilPE RATIO:na
NET ASSET VALUE:15.5¢*NET CASH:$8.5m

Year to 31 DecTurnover ($m)Pre-tax profit ($m)Earnings per share (¢)Dividend per share (p)
201211.3-6.3-3.4nil
201313.4-4.5-0.6nil
201412.614.33.7nil
201510.1-18.7-3.9nil
20169.9-20.5-2.5nil
% change-2---

Ex-div: na

Payment: na

£1=$1.29

*Includes intangible assets of $103m, or 11¢ a share.