17th Mar 2016 08:00
LONDON (Alliance News) - SOCO International PLC Thursday said it managed to book a small profit in 2015 as a fall in production and oil prices led its revenue to more than halve, and the company said it has slashed its dividend for the year but is considering additional payouts in 2016.
The oil and gas exploration and production company managed to squeeze out a pretax profit in 2015 of USD8.2 million compared to the GBP152.7 million profit booked in 2014 as revenue more than halved to USD212.8 million from USD448.2 million.
Partly offsetting the fall in revenue was a large reduction in exploration expenditure, which fell to USD35.6 million in the year compared to USD79.5 million the year before, and the absence of a USD60.5 million impairment that was made in 2014.
However, this failed to prevent the 95% fall in pretax profit in the year.
SOCO said it will pay a dividend of 2.0 pence per share, giving it a total 2015 dividend of 2.1 pence. That is down from 10.0 pence per share in 2014.
However, SOCO said it would be considering an "additional distribution" to shareholders in the second half of 2016.
"Further, given an oil price at or above current levels and no major adverse surprises in our budget for the year, we anticipate that the board will at mid-year results propose a special payout to be distributed in the second half of the year," said SOCO.
The fall in oil prices was exacerbated by a drop in production to 11,976 barrels of oil equivalent per day from the 13,605 barrels being produced each day in 2014, and SOCO said production is expected to fall to around 10,000 to 11,500 barrels a day this year.
Although production was down year-on-year in 2015, SOCO said it was at the top end of its guidance range.
Cash operating costs in the year were around USD10 per barrel, which is expected to stay flat this year.
SOCO said its "firm" capital expenditure budget for this year will be USD54.0 million, and said all of its exploration development work programmes are fully funded. Capital expenditure in 2015 amounted to USD87.5 million, down from USD162.5 million in 2014.
By Joshua Warner; [email protected]; @JoshAlliance
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