Egdon Resources ' (EDR) annual results illustrate another challenging year for the company as operational issues at a number of fields hampered output.
Production averaged 125 barrels of oil equivalent per day (boepd) during the period, down slightly from 128 boepd last year, from the company's combined interests in the Keddington, Avington, Kirkleatham and Ceres fields, all in the UK.
And while higher prices meant revenues increased slightly, Egdon recorded a hefty loss for the period due to impairment charges totalling £3.15m in respect of several properties. The numbers look particularly bad compared with profits of £4.08m last year, although on closer inspection those were plumped up by a £4.3m profit on the sale of certain French oil and gas interests.
Meanwhile, the reduction in cash flow from production has resulted in a funding shortfall for the company's planned exploration programs. It now intends to focus on fewer assets and will look to once again sell non-core assets and farm-out others to fund exploration.
House broker Seymour Pierce expects production for next year to be roughly in line with current levels, given the continued issues at the Ceres and Kirkleatham fields. Prior to the results, it forecast EPS of 1.4¢ for fiscal 2013 (Seymour Pierce forecast a loss per share of 0.4¢ for 2012).
EGDON RESOURCES (EDR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 6.75p | MARKET VALUE: | £9m | |
| TOUCH: | 6.5-7p | 12-MONTH HIGH: | 14.5p | LOW: 6.25p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 13p* | NET CASH: | £3.3m | |
| Year to 31 Jul | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 1.12 | -2.38 | -3.52 | nil |
| 2009 | 0.88 | -0.08 | -0.12 | nil |
| 2010 | 1.25 | 0.24 | 0.29 | nil |
| 2011 | 2.38 | 4.08 | 3.12 | nil |
| 2012 | 2.61 | -2.89 | -2.21 | nil |
| % change | +10 | - | - | - |
*Includes intangible assets of £8.3m, or 6p a share | ||||
