Shares in EnQuest (ENQ) were up a fifth on release of the North Sea driller's full-year figures, even though they showed a net earnings loss of $176m (£119m) in 2014 against a profit of $190m the previous year. The loss was attributable to $335m in post-tax impairments brought about by "lower near-term oil price assumptions". Cash profits were down by a relatively modest 6.5 per cent to $581m.
The good news is that EnQuest drove up production by 15 per cent to an average of 27,895 barrels of oil equivalent per day (boepd). And the group - whose Kraken field is one of the largest developments in the North Sea - expects to increase production to at least 33,000 boepd in 2015.
In response to the fall-away in crude oil prices, EnQuest has reduced its capital commitment to $600m - 40 per cent lower than in 2014. The company is also seeking to mitigate the anticipated decline in revenues this year and next by increasing the proportion of production that is forward-sold and reducing operating costs per barrel from $42.10 to $38.
After the year-end, the company successfully renegotiated its debt covenants with lenders.
| ENQUEST (ENQ) | ||||
|---|---|---|---|---|
| ORD PRICE: | 38p | MARKET VALUE: | £301m | |
| TOUCH: | 37-38p | 12-MONTH HIGH: | 145p | LOW: 22p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 169¢* | NET DEBT: | 69% | |
| Year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2010 | 0.58 | 56.0 | 4.0 | nil |
| 2011 | 0.94 | 363 | 7.6 | nil |
| 2012 | 0.89 | 403 | 46.2 | nil |
| 2013 | 0.96 | 331 | 24.0 | nil |
| 2014 | 1.03 | -579 | -23 | nil |
| % change | +8 | - | - | - |
Ex-div:- Payment:- £1 = $1.48. *Includes intangible assets of $255m, or 32p a share. | ||||
