Mid-cap explorer Heritage Oil is about to pay its first ever dividend. As soon it has completed the sale of its vast Ugandan oil fields to Tullow Oil for up to $1.5bn - which should happen this month or next - Heritage will give investors a 75-100p per share bonus. Having received an official letter in support of the deal earlier this month, the company expects the government’s final approval to be a formality.
Heritage will then focus on its asset in the semi-autonomous Kurdistan region of Iraq. This sounds like an even more speculative place to find business, and indeed the exit pipeline is currently blocked because of a payment dispute between Baghdad and the local government. But chief financial officer Paul Atherton expects this to come to a swift resolution following last month’s elections. If it does, the company’s two sites have huge potential, with the first expected to yield 8,000-10,000 barrels of oil per day.
Broker Evolution expects pre-tax profits this year of $1.18bn and losses per share of 8¢ (2009: losses of $31m and 9¢ respectively)
HERITAGE OIL (HOIL) | ||||
|---|---|---|---|---|
| ORD PRICE: | 453p | MARKET VALUE: | £1,290m | |
| TOUCH: | 453-454p | 12-MONTH HIGH: | 630p | LOW: 372p |
| DIVIDEND YIELD: | NIL | PE RATIO: | NA | |
| NET ASSET VALUE: | 137¢* | NET CASH: | $78m | |
| Year to 31 Dec | Turnover ($m) | Pre-tax loss ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2005** | 0.84 | -7.3 | -0.33 | nil |
| 2006** | 3.94 | -11.9 | -0.54 | nil |
| 2007** | 3.71 | -83.2 | -0.37 | nil |
| 2008 | 3.84 | -43.3 | -0.17 | nil |
| 2009 | 2.70 | -36.8 | -0.13 | nil |
| % change | -30 | - | - | - |
Ex-div: na Payment: na *Includes intangibles of $121m or 43¢ per share **Heritage transferred its main listing from the Toronto Stock Exchange to the London Stock Exchange in 2008 | ||||
