29th Jul 2015 06:00
LONDON (Alliance News) - Tullow Oil PLC Wednesday slashed its interim dividend for the first half of the year after a slump in revenue due to lower oil prices led to pretax loss for the period.
The FTSE 250-listed oil company reported a pretax loss of USD10.2 million in the first half, narrowing from a USD28.9 million loss a year earlier, as revenue dropped to USD819.9 million from USD1.26 billion.
Despite revenue falling, the loss narrowed due to fewer exploration write-offs, which totalled USD87.5 million compared to USD402.2 million whilst it also booked a USD43.9 million loss from disposals compared to a USD114.8 million loss.
However, the company has decided to not pay an interim dividend due to the fall in oil prices, stating it would reinvest cash into the business. A year earlier it paid an interim dividend of 4.0 pence per share.
The company's restructuring programme is "nearing completion", which will lead to USD500 million worth of savings being achieved over the next three years, which will begin to take effect in the second half of 2015, it said.
Capital expenditure for the half totalled USD783 million, and full year guidance remains unchanged at USD1.90 billion.
Average working interest production for the half was 74,600 barrels of oil equivalent per day, down 5% from a year earlier when it was averaging 78,400 barrels per day, but this is in line with expectations and guidance, which remains unchanged for the full year.
Sales fell 9% to 66,500 barrels per day from 73,200 barrels per day, compounded by lower oil prices. Tullow achieved an average price of USD70.6 per barrel in the first half compared to USD106.7 per barrel a year earlier.
In terms of exploration in the rest of 2015, Tullow will focus on its assets in Suriname, Norway and Kenya.
By Joshua Warner; [email protected]; @JoshAlliance
Copyright 2015 Alliance News Limited. All Rights Reserved.
Related Shares:
Tullow Oil