A high average oil price and new production coming on-stream in Vietnam meant robust headline growth for SOCO International (SIA). Indeed, cash generation has been sufficiently strong for shareholders to probably benefit from another return of capital this year - following 2012's $32.9m (£22m) share buy-back.
An operational ramp-up at the Te Giac Trang (TGT) field in Vietnam, after the installation of a second well head platform, brought total production there up to 50,000 barrels of oil equivalent per day (BOEPD). That helped double its share of production to 15,500 BOEPD at a time of higher and more stable oil prices. The high quality of Vietnamese oil, and a ready market in Singapore, meant SOCO received an average price of $118 a barrel - a $5-$7 premium to the Brent Crude price, compared with an average price of $113 in 2011.
Meanwhile, SOCO still has the southern end of the TGT field to assess once the winter monsoon lifts and spring drilling can begin. That said, SOCO's African prospects are far earlier stage and have been hit by operational problems - particularly in the Republic of Congo, where there have been delays to rig drilling for the off-shore assets, as well as a deteriorating security situation inland.
Bank of America Merrill Lynch forecasts EPS of 101¢ for 2013 (62.6¢ in 2012) and estimates net asset value (NAV) at 513p.
SOCO INTERNATIONAL (SIA) | ||||
|---|---|---|---|---|
| ORD PRICE: | 385p | MARKET VALUE: | £1.28bn | |
| TOUCH: | 383-385p | 12-MONTH HIGH: | 408p | LOW: 252p |
| DIVIDEND YIELD: | nil | PE RATIO: | 9 | |
| NET ASSET VALUE: | 355p* | NET CASH: | $211m** | |
| Year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2008 | 55.3 | 37.4 | 42.8 | nil |
| 2009 | 69.3 | 54.7 | 11.8 | nil |
| 2010 | 48.4 | 30.9 | 3.80 | nil |
| 2011 | 234 | 159 | 26.4 | nil |
| 2012 | 622 | 446 | 62.7 | nil |
| % change | +166 | +181 | +138 | - |
Ex-div: - Payment: - *Includes intangible assets of $200m, or 60¢ a share **Includes $50m of liquid investments £1=$1.49 | ||||
