The Argentine government's nationalisation of YPF last month has certainly hit sentiment towards Argentine-focused oil and gas plays - President Petroleum included. But this relatively new entrant into the Argentine market is growing production fast, leaving the shares looking attractive for those investors willing to accept the risks.
Indeed, President's net production reached 252 barrels of oil equivalent per day (boepd) - up from 185 boepd in 2010 - helped by the acquisition of a 50 per cent interest in the onshore Puesto Guardian block. That move brought net Argentine production to 183 barrels of oil per day during the second half. Moreover, a fully funded five-well drilling campaign this year should bolster production further and help drive the company toward its 1,300-1,500 boepd target by the end of the next quarter. The first two wells were drilled earlier this year, with a third planned for this month and a deeper, potentially transformational play due in the second half. Test rates from the first well, DP-1001, suggested over 300 barrels per day of unstimulated oil production. President looks well funded, too, having raised $9.8m (£6m) through a placing in February.
Before these figures, broker RBC Capital Markets was expecting EPS of 19¢ for 2012.
PRESIDENT PETROLEUM COMPANY (PPC) | ||||
|---|---|---|---|---|
| ORD PRICE: | 37p | MARKET VALUE: | £48m | |
| TOUCH: | 36-37p | 12-MONTH HIGH: | 61p | LOW: 21p |
| DIVIDEND YIELD: | NIL | PE RATIO: | NA | |
| NET ASSET VALUE: | 30¢* | NET CASH: | $6.3m** | |
| Year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2007 | 2.44 | -3.50 | -23.5 | nil |
| 2008 | 18.1 | 2.78 | 14.9 | nil |
| 2009 | 3.93 | -4.19 | -23.5 | nil |
| 2010 | 3.44 | -6.63 | -11.6 | nil |
| 2011 | 7.05 | -21.4 | -19.1 | nil |
| % change | +105 | - | - | - |
*Includes intangible assets of $34.6m, or 27¢ a share **Excludes the proceeds from February 2012's share placing £1=$1.61 | ||||
