11th Mar 2005 07:05
Edinburgh Oil & Gas PLC11 March 2005 News Release 11 March 2005 Buzzard oil reserves revised upwards as development continues on schedule Edinburgh Oil & Gas plc announces its preliminary results for the year ended 31December 2004. • Pre-tax profits £297,000 compared to £35,000 loss in previous year. • Buzzard development progressing on schedule and within budget. • Company's share of Buzzard oil reserve estimates rises from 24 million barrels to in excess of 27 million barrels. Alf Bissett, Managing Director of Edinburgh Oil & Gas plc said: "We remain focused on the Buzzard development and the increase in the reservesestimate and the rising oil price significantly enhance the value of theproject." For further information, please contact: Alf Bissett Roland CrossManaging Director DirectorEdinburgh Oil & Gas plc Broadgate0131 225 5454 020 7726 6111 Chairman's Statement I am pleased to report good progress on the development of the Company'sprincipal asset, the Buzzard oilfield. The fabrication of the three jackets isahead of schedule and progress is also satisfactory on construction of the threeplatforms. The development cost is still forecast to be within budget. Additional sub-surface studies have resulted in a small upwards revision of theestimated oil in place. Our latest independent petroleum engineering reportestimates the Buzzard proven and probable reserves net to the Company's interestto be in excess 27 million barrels compared to the estimate of approximately 24million barrels at the end of 2003. Drilling of the pre-production developmentwells is due to commence in the third quarter of this year and first productionis still on target for the fourth quarter of 2006. The Company's financial results continue to reflect the disposal in the previousyear of various UK onshore oil and gas properties that were no longer consideredmaterial to the Company's future. The lower production levels have reducedturnover but operating profits were £317,000 due to higher oil prices andproduction cost control. Pre tax profits were £297,000 compared to a loss of£35,000 in the previous year. The balance sheet reflects the increasing capital expenditure on the Buzzarddevelopment on the asset side largely matched by the reduction in cash balancesand drawdowns on our US$105 million credit facility. Net debt at the year endwas £10.7 million. To date the Company has not entered into any hedgingarrangements. As previously reported, the Company's exploration activities in the UK offshoreduring 2004 were unsuccessful but we believe that our strategy of exposingshareholders to the potential for significant discoveries through a smallexploration programme with a modest capital investment remains appropriate atthis time to complement the concentrated effort on the Buzzard development. The UK onshore assets continue to provide a steady source of cash flow and weare evaluating opportunities to expand our participation in the provision of gasstorage capacity. Our objectives are to increase the Company's oil and gasreserves and enhance shareholder value and clearly the current strength of thecrude oil price is very beneficial to our net asset value. We view our futurewith confidence and I would like to thank our staff for their continued highperformance on behalf of shareholders. C H RossChairman10 March 2005 EDINBURGH OIL & GAS plcGROUP PROFIT AND LOSS ACCOUNTFor the year ended 31 December 2004 2004 2003 £000 £000 Turnover 2,370 3,052 Cost of sales (706) (1,412)Depletion (617) (1,017) -------- ---------Gross profit 1,047 623 -------- --------- Administrative expenses (729) (629)Exchange losses (1) (2) -------- --------- (730) (631) -------- --------- Operating profit/(loss) 317 (8)Gains on disposal of fixed assets - 2 -------- ---------Profit/(loss) on ordinary activities before interest andtaxation 317 (6) Income from investments 8 -Interest receivable 65 127Interest payable and other similar charges (93) (156) -------- ---------Profit/(loss) on ordinary activities before taxation 297 (35) Taxation 28 966 -------- ---------Profit for the financial year transferred to reserves 325 931 -------- --------- Earnings per share - basic 0.78p 2.24p - diluted 0.76p 2.18p -------- --------- The directors do not recommend the payment of a dividend. The Annual GeneralMeeting of the Company will be held on Friday 20 May 2005 at 12 noon. The 2004Annual Report is expected to be posted to shareholders at the beginning of April2005. The financial information set out above does not constitute the Company'sstatutory accounts for the years ended 31 December 2004 or 2003. Statutoryaccounts for 2003 have been delivered to the Registrar of Companies and thosefor 2004 will be delivered following the Company's Annual General Meeting. Theauditors have reported on these accounts; their reports were unqualified and didnot contain statements under section 237(2) or (3) of the Companies Act 1985. GROUP BALANCE SHEETAs at 31 December 2004 2004 2003 £000 £000 Fixed assetsTangible assets 32,365 13,554Investments 279 83 -------- --------- 32,644 13,637 -------- ---------Current assetsDebtors 511 373Cash at bank and in hand 768 6,550 -------- --------- 1,279 6,923Creditors : amounts falling due within one year (3,969) (1,839) -------- ---------Net current (liabilities)/assets (2,690) 5,084 -------- --------- Total assets less current liabilities 29,954 18,721Creditors: amounts falling due after one year (10,837) (162) Provisions for liabilities and chargesDeferred tax provisions (75) (103)Other provisions (598) (598) -------- --------- (673) (701) -------- ---------Net assets 18,444 17,858 -------- --------- Capital and reservesCalled-up share capital 2,094 2,081Share premium 10,521 10,469Revaluation reserve 197 1Capital redemption reserve 3,476 3,476Profit and loss account 2,156 1,831 -------- ---------Equity shareholders' funds 18,444 17,858 -------- --------- The financial statements were approved by the Board of Directors on 10March 2005. GROUP CASH FLOW STATEMENTFor the year ended 31 December 2004 2004 2003 £000 £000 Net cash inflow from operating activities 1,008 2,420 -------- --------- Returns on investments and servicing of financeInterest received 65 127Income from investments 8 -Interest paid (17) (24) -------- ---------Net cash inflow from returns on investments and servicing offinance 56 103 -------- --------- Capital expenditure and financial investmentPayments to acquire oil and gas assets (17,600) (2,813)Payments to acquire other tangible assets (2) (30)Receipts from disposal of fixed assets - 3,856 -------- ---------Net cash (outflow)/inflow from capital expenditure andfinancial investment (17,602) 1,013 -------- --------- Net cash (outflow)/inflow before financing (16,538) 3,536 FinancingIssue of ordinary share capital 65 3Drawdown of credit facility 11,726 -Credit facility charges (855) -Repayment of capital element of hire purchase contracts (104) (96) -------- ---------(Decrease)/increase in cash in the year (5,706) 3,443 -------- --------- This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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