26th Feb 2014 12:43
LONDON (Alliance News) - Fortune Oil PLC Wednesday reported a sharp increase in net profit in 2013 as it booked a gain on its investment in China Gas Holdings Ltd and the disposal of Fortune Gas Investment Holdings Ltd, and saw revenues rise 16%.
The oil and gas company focused on China reported a net profit of GBP164.1 million, up frim GBP15.7 million in 2012, as it booked a gain of GBP76.1 million on its investment in China Gas Holdings, a GBP100.9 million gains for the disposal of Fortune Gas Investment, partly offset by the GBP35.8 million writedown of the value of its Armenian iron ore project that it flagged in December.
Its revenues rose to GBP856.6 million, from GBP739.4 million.
"The oil business continues to make good progress. The Bluesky aviation fuel business is well positioned to participate in the anticipated continued growth in air travel in China and we have renewed and expanded the Maoming Single Point Mooring cooperation with Sinopec. We expect demand for oil and oil based products in China to continue to remain strong and the board is excited by the medium term growth prospects for our oil business," Chairman Qian Benyuan said in a statement.
China Gas Holdings is now an associate in the company's accounts. Last year, Fortune Oil transferred its Fortune gas business to China Gas. As a result, its China Gas Group joint venture has a 14.69% stake in China Gas Holdings.
In December, it had warned it would write down the value of its Armenian iron ore project after transportation costs rose and iron ore prices declined.
At that time, it said it would change its financial year-end to March 31, from December 31, starting from its 2014 financial year. That will bring it into line with the financial year of China Gas Holdings, making preparation of its accounts easier now that China Gas Holdings is an associate in its accounts.
"Fortune Oil continues to strengthen its position in the Chinese natural gas industry through our strategic investment in China Gas Holdings Limited," Benyuan said.
Fortune Oil shares were up 5.8% at 11.64 pence Wednesday afternoon.
By Steve McGrath; [email protected]; @SteveMcGrath1
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