Skip to main navigation or content
The first half of 2008 certainly lived up to expectations for Melrose Resources. Long-trailed as the first period in which the company would benefit from oil production on its flagship Egyptian licences, the black stuff could not have appeared at a better time for prices. Earnings accordingly were ahead of expectations, also boosted by costs that were significantly below forecasts.
Advertising
The focus now is on boosting oil production from the West Dikirnis field from around 8,000 barrels per day (bpd) to 10,000bpd with the drilling of a new horizontal well by the year-end. Significant increments of gas condensate production - as valuable as oil - will also emerge as a series of new gas wells on other fields are brought on stream through late 2008 and into 2009. Further Egyptian exploration over the next 12 months will target a mixture of oil and gas prospects. Meanwhile, the company continues to improve its western US asset base, an acquisition legacy, and is preparing for a high-risk, high-impact exploration campaign in southern Turkey from 2010.
Brewin Dolphin expects full-year adjusted, diluted EPS of 55.5p (loss of 29.1p in 2007).
| Melrose Resources (MRS) | ||||
|---|---|---|---|---|
| ORD PRICE: | 414p | MARKET VALUE: | £456m | |
| TOUCH: | 412-415p | 12-MONTH HIGH: | 445p | LOW: 260p |
| DIVIDEND YIELD: | 0.8% | PE RATIO: | 23 | |
| NET ASSET VALUE: | 320¢* | NET DEBT: | 109% | |
| Half-year to 30 Jun |
Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (p) |
|---|---|---|---|---|
| 2007 | 76 | -34.3 | -38.6 | nil |
| 2008 | 234 | 134.0 | 69.1 | 1.2 |
| % change | +209 | - | - | - |
Ex-div:17 Sep Payment:17 Oct £1=$1.83 *Includes $152m of intangibles, or 138¢ a share |
||||
Guide to the terms used in IC results tables.
More analysis of company results.
More articles, comment and data on Melrose Resources.
The shares are up 27 per cent since we recommended buying them earlier this year, and while the big jump in earnings was a one-off, they are good value at 414p due to a promising spread of appraisal and exploration opportunities.
Last IC View: Buy, 326p, 18 March 2008.
The UK’s No.1 Stockbroker
Access a selection of share tips, comprehensive company analysis and full financial data on listed companies. Plus portfolio tools with advanced alerts when you register for free here.
Advertorial Feature
With so many big moves in the world's financial markets, there have seldom been more opportunities around for spread traders. Isn't it time you joined them?
by Dominic Piccarda
© The Financial Times Limited 2008. All rights reserved. "Investors Chronicle", "FT" and "Financial Times" are trademarks of The Financial Times Limited. No part of these web pages may be reproduced or transmitted to or stored in any other website or other form of electronic retrieval system, without prior permission in writing from the editor.
Warning: Do remember, particularly if you are new to stock market investment that the prices of shares and other investments can fall sharply. You may not get back the money you originally invested. The material here is for general information only and is not intended to be relied upon for individual investment decisions. Take independent advice before making such decisions. This site is aimed at UK residents only. To read more please see our Important Warning
-IC-1.5.4a-prod - 31/10/2008 13:11:34 - carlos.princz
