BG Group (BG.) had re-established operational momentum in the run-up to its year-end update. But now the positive developments in both Egypt and Queensland have been overshadowed by an $8.9bn (£5.9bn) pre-tax impairment charge. That fed through into an operating loss of $1.7bn for 2014, against a profit of $3.7bn in the previous year.
The group now expects capital expenditure this year to be "significantly lower" than in 2014, as it pares back commitments in response to lower anticipated cash-flows. BG also intends to trim operating costs by around 10 per cent - including some staff reductions. The group has been successfully hiving off non-core assets to reduce net debt, which nonetheless increased by 13 per cent year on year to $12bn.
Despite the capital-spending cuts, the outlook on group production has become more favourable. Last year's output came in at the lower end of guidance, at 606,000 barrels of oil equivalent per day (boepd). But group output could conceivably rise by well over 10 per cent this year on the back of the ramp-up at the huge Queensland Curtis LNG complex and BG's offshore licence interests in Brazil.
JPMorgan expects adjusted EPS of $0.85 in 2015, rising to $1.39 next year.
| BG GROUP (BG.) | ||||
|---|---|---|---|---|
| ORD PRICE: | 926p | MARKET VALUE: | £31.6bn | |
| TOUCH: | 926-927p | 12M HIGH / LOW: | 1,300p | 781p |
| DIVIDEND YIELD: | 1.9% | PE RATIO: | NA | |
| NET ASSET VALUE: | 853¢ | NET DEBT: | 41% | |
| Year to 31 Dec | Turnover ($bn) | Pre-tax profit ($bn) | Earnings per share (¢) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 17.2 | 5.7 | 100 | 13.70 |
| 2011 | 17.7 | 7.2 | 121 | 14.80 |
| 2012 | 18.9 | 6.4 | 98 | 16.70 |
| 2013 | 19.3 | 3.9 | 65 | 17.99 |
| 2014 | 19.9 | -2.3 | -31 | 17.99 |
| % change | +3 | - | - | - |
Ex-div: 23 Apr Payment: 22 May £1 = $1.50 | ||||
