21st Jul 2016 17:26
LONDON (Alliance News) - Vedanta Resources PLC Thursday said its subsidiary Cairn India Ltd saw its normalised net profit jump 88% in its first quarter to end-June compared to the previous quarter.
Cairn India's Earnings before interest, tax, depreciation and amortisation rose 48% compared to the previous quarter, helped by lower operating costs and a 10% rise in revenue on improved price realisation.
Additionally, it said it saw strong total free cash flow equivalent to USD226 million despite the low oil price.
During the first quarter Cairn had a gross production of 17.9 million barrels of oil equivalent across all of its assets, of which its working interest production was 11.4 million barrels of oil equivalent.
Gross sales were 17.7 million barrels of oil equivalent, averaging at 195,003 barrels of oil equivalent per day.
Cairn said it will remain focused on monetising its Rajasthan resource base in its current financial year, with a net capital expenditure spend of USD100 million proposed. It aims to maintain production from the Rajasthan asset at the same level as the previous year.
"The Cairn team has delivered a resilient performance, registering 88% increase in profit for the quarter on sequential basis. We have taken significant measures to drive cost efficiency and rationalize capital investment, resulting in free cash generation in a lower-for-longer oil price environment," said Chief Financial Officer and Acting Chief Executive Officer Sudhir Mathur in a statement.
"We remain committed to our four projects - RDG Gas, Enhance Recovery at Bhagyam & Aishwariya as well as the tight oil projects. Sharp reductions in drilling and fraccing costs coupled with learnings from Mangala EOR give us the confidence that we will be ready to execute in a USD50 a barrel world within 12 months," Mathur added.
Shares in Vedanta closed up 3.9% at 520.14 pence Thursday.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
Copyright 2016 Alliance News Limited. All Rights Reserved.
Related Shares:
Vedanta Resources