5th Aug 2015 07:15
LONDON (Alliance News) - Oil and gas explorer SOCO International PLC on Wednesday said its pretax profit for the first half plunged as its revenue more than halved thanks to the collapse in the oil price in the past year.
SOCO, which has operations in Vietnam and Africa, said its pretax profit for the six months to the end of June was USD32.7 million, substantially lower than the USD174.7 million it posted a year earlier. Since those results were posted, the oil price has dropped significantly and has remained hovering around the lows it hit, which also meant SOCO's revenue in the first half was down to USD116.6 million from USD246.4 million.
The group said it was not paying an interim dividend and said future payouts will be determined in light of the oil price, cash flow generation from its Vietnam operations and its capital expenditure expectations at the time of its full-year results.
Production for the company averaged 11,856 barrels of oil equivalent per day in the half and it has upgraded the lower end of its full-year production guidance. SOCO now expects its full-year average production to be 11,000-12,000 barrels of oil equivalent per day, up from 10,500-12,000 barrels previously. SOCO also maintained its capital expenditure guidance for the year at around GBP90 million, with USD70 million allocated to Vietnam and USD20 million for Africa.
SOCO said its focus now is on delivering the H5 field at the Te Giac Trang field in Vietnam and said work at the site is ahead of schedule, with topside installed during July and the first oil expected from the field this month.
Ed Story, SOCO's chief executive, said that despite the challenging oil price environment, dividend payouts and the costs associated with the H5 development, the company remains in a robust financial position.
SOCO shares were up 0.3% to 157.00 pence on Wednesday morning.
By Sam Unsted; [email protected]; @SamUAtAlliance
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