Saffron Energy Annual Loss Widens As Gas Production Rises

29th Mar 2018 13:56

LONDON (Alliance News) - Saffron Energy PLC on Thursday posted a widened annual pretax loss on the back of increased costs and despite higher revenue generation.

The firm which has changed its strategy to become a European and Asian gas explorer from an solely Italian explorer, also said that total production for 2017 rose to seven million standard cubic metres of gas from 4.4 million standard cubic metres in 2016.

For 2017, the company's pretax loss widened to EUR7.0 million from EUR6.5 million loss a year ago. Revenue rose to EUR1.4 from EUR701,000 mainly due to commercialisation of gas produced from Bezzecca field in Italy.

The widened pretax loss was attributed to increase in corporate overheads and impairment charges. Exploration costs fell to EUR4,000 from EUR287,000 in the period.

The company, which is to be renamed Coro Energy PLC, recorded impairment loss of EUR4.8 million in 2017 versus EUR4.6 million. Corporate overheads totaled EUR1.2 million versus EUR606,000.

"These results reflect the performance of our historic portfolio of three gas fields in northern Italy. Our focus is now very much on driving the business forward from its Italian platform to identify exciting multi-TCF opportunities in South East Asia. To that end we have raised funds to support this new strategy and strengthened the senior team to provide the bandwidth and local knowledge required to take the company's next steps in that region. We are very excited about Coro's future and look forward to updating investors on our progress," Chief Executive Sara Edmonson said.

Edmonson is moving to the role of deputy CEO and the company has has hired former Salamander Energy PLC CEO James Menzies in the same role.

Saffron Energy earlier in the March said it it expects to be re-admitted to London's AIM market in April after its purchase of Italian assets from Sound Energy PLC

The company is buying Sound Energy subsidiary Sound Energy Holdings Italy Ltd for 185.9 million Saffron shares and a 5% royalty on all revenue derived from the exploration licence DR74AP, also known as Laura.

It was also meant to buy assets from Po Valley Energy Ltd for 200.0 million new Saffron shares, but pulled out of this at the end of February to focus on deals in south-east Asia.

Shares in the company were trading at 4.2% at 4.32 pence.