1st Sep 2015 13:35
LONDON (Alliance News) - Jubilant Energy NV shares dropped on Tuesday after it said it is considering all options, including potentially selling assets, in order to address its mounting debt problems after reporting a huge pretax loss in the last financial year.
Jubilant shares were down 37.5% to 1.25 pence per share on Tuesday afternoon.
The emerging oil and gas player in India reported a huge USD134.8 million pretax loss in the year ended March 31, widening from a USD3.4 million loss a year earlier after it booked a USD121.9 million impairment against its Deendayal block and Sanand-Miroli block due to the delays in starting production, cost overruns and lower than expected gas prices put in place by the Indian government.
Revenue also dropped to USD10.0 million from the USD15.8 million generated in the previous year as gross sales from its sole-producing Kharsang field fell by more than a quarter to 118,176 barrels of oil net to the company.
That was compounded by the fall in oil prices, which averaged USD94.35 per barrel in the year, representing a 14% year-on-year drop, but is still significantly higher than spot Brent price which was trading at around USD53 per barrel on Tuesday.
At the end of March, the company reported net debt of USD514.4 million with available cash totalling USD21.6 million.
"The management acknowledges that uncertainty remains over the ability of the company to meet its current and future anticipated funding requirements and to refinance or repay its banking facilities as they fall due. The existence of material uncertainties cast significant doubt about the entity's ability to continue as a going concern," it said in a statement.
"In order to address the current situation, company is focusing on all options including monetizing assets, prioritizing investments and debt restructuring," it added.
In addition to the large amount of debt, Jubilant said it owes INR3.13 billion to the operator of the Deendayal block which has not been paid on account of "certain differences between the operator and the company," it said.
"The company is actively engaging with the operator to resolve the issue amicably," it said in a statement.
By Joshua Warner; [email protected]; @JoshAlliance
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