28th Oct 2014 08:53
LONDON (Alliance News) - BG Group PLC saw its shares fall Tuesday after it reported a drop in its underlying earnings in the third quarter, and said its exploration and production guidance remains at the low end of its forecast range.
The company's third-quarter E&P production was 569 thousand barrels of oil equivalent a day, at the lower end of the 590-630 thousand barrels of oil equivalent a day range, reflecting continuing issues in Egypt and the acceleration into 2014 of production sharing contract effects in Kazakhstan.
Business Performance operating profit, the company's preferred non-GAAP measure of profit that excludes disposals, certain re-measurements and impairments and other exceptional items, fell 26% to USD1.31 billion as profit from upstream operations fell 36% to USD746 million.
In LNG Shipping and Marketing, Business Performance operating profit fell to USD576 million from USD602 million. BG Group said the strong performance so far this year isn't expected to continue though it kept its total operating profit guidance of USD2.1 billion to USD2.4 billion.
BG Group said profit was significantly reduced in Kazakhstan as revenue fell, and in the UK because of higher costs of new developments and shutdowns.
Group pretax profit rose to USD1.99 billion in the three months to September 30, from USD1.91 billion a year earlier, as revenue rose to USD4.59 billion, from USD4.43 billion.
Interim Executive Chairman Andrew Gould said the appointment of new Chief Executive Helge Lund, formerly chief executive at Norway's Statoil, would provide stability for the group.
"Helge's track record in building a world class exploration and production portfolio speaks for itself, and we believe we have the best person in the international oil and gas market to lead BG Group in its next phase of growth," Gould said.
At 0831 GMT, BG Group shares were down 0.4% at 1,038.50 pence while the FTSE 100 share index was up 1.5% at 6,394.30.
By Ian Edmondson
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