5th Feb 2010 07:00
BG Group plc
2009 FOURTH QUARTER & FULL YEAR RESULTS
Full Year Highlights
·; Production volumes up 4%
·; LNG total operating profit of £1.55 billion
·; Earnings per share of 67.3p despite challenging economic environment
·; Strong cash flow from operations of £4.9 billion
·; Full year dividend increased by 10% to 12.35p
·; Total reserves and resources increased by 10% to 14.5 billion boe
·; Excellent progress in Brazil, Australia and the USA
BG Group's Chief Executive, Frank Chapman said:
"BG Group has delivered a solid performance this year despite the challenging economic environment. The results reflect the benefit of integration across the gas chain combined with a particular focus on markets - the hallmarks of BG Group's long-term strategy. The LNG business delivered a very strong result, while excellent progress continues to be made in Brazil, Australia and the USA, underpinning our confidence in the Group's growth outlook to 2020."
BG Group issued its annual strategy update in conjunction with today's statement. This is available for viewing at www.bg-group.com
|
Fourth Quarter |
|
|
|
Full Year |
|
||
|
2009 £m |
2008 £m |
|
|
Business Performance(a) |
2009 £m |
2008 £m |
|
|
1 108 |
1 139 |
-3% |
|
Total operating profit including share of pre-tax operating results from joint ventures and associates |
4 211 |
5 355 |
-21% |
|
592 |
695 |
-15% |
|
Earnings for the period |
2 263 |
3 068 |
-26% |
|
17.6p |
20.7p |
-15% |
|
Earnings per share |
67.3p |
91.6p |
-27% |
|
6.73p |
6.55p |
+3% |
|
Dividend per share |
12.35p |
11.23p |
+10% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total results for the period (including disposals, re-measurements and impairments) |
|
|
|
|
843 |
1 200 |
-30% |
|
Operating profit before share of results from joint ventures and associates |
3 773 |
5 239 |
-28% |
|
926 |
1 271 |
-27% |
|
Total operating profit including share of pre-tax operating results from joint ventures and associates |
4 103 |
5 488 |
-25% |
|
465 |
756 |
-38% |
|
Earnings for the period |
2 168 |
3 127 |
-31% |
|
13.8p |
22.5p |
-39% |
|
Earnings per share |
64.5p |
93.4p |
-31% |
a) 'Business Performance' excludes disposals, certain re-measurements and impairments as exclusion of these items provides a clear and consistent presentation of the underlying operating performance of the Group's ongoing business. For further explanation of Business Performance and the presentation of results from joint ventures and associates, see Presentation of Non-GAAP measures (page 9), note 1 (page 17) and note 3 (page 19). For further details of the items included in disposals, re-measurements and impairments, see note 2 (page 18). Unless otherwise stated, the results discussed in this release relate to BG Group's Business Performance.
Business Review - Group
|
Fourth Quarter |
|
|
|
Full Year |
|
|
||||
|
2009 £m |
|
2008 £m |
|
|
Business Performance |
2009 £m |
|
2008 £m |
|
|
|
2 702 |
|
2 989 |
|
-10% |
Revenue and other operating income |
10 363 |
|
12 602 |
|
-18% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating profit including share of pre-tax results from joint ventures and associates |
|
|
|
|
|
|
579 |
|
677 |
|
-14% |
Exploration and Production |
2 087 |
|
3 512 |
|
-41% |
|
358 |
|
456 |
|
-21% |
Liquefied Natural Gas |
1 551 |
|
1 585 |
|
-2% |
|
116 |
|
(6) |
|
- |
Transmission and Distribution |
426 |
|
160 |
|
+166% |
|
55 |
|
21 |
|
+162% |
Power Generation |
158 |
|
118 |
|
+34% |
|
- |
|
(9) |
|
- |
Other activities |
(11) |
|
(20) |
|
-45% |
|
1 108 |
|
1 139 |
|
-3% |
|
4 211 |
|
5 355 |
|
-21% |
|
|
|
|
|
|
|
|
|
|
|
|
|
(36) |
|
21 |
|
- |
Net finance (costs)/income |
(144) |
|
25 |
|
- |
|
(451) |
|
(472) |
|
-4% |
Taxation for the period |
(1 708) |
|
(2 287) |
|
-25% |
|
592 |
|
695 |
|
-15% |
Earnings for the period |
2 263 |
|
3 068 |
|
-26% |
|
|
|
|
|
|
|
|
|
|
|
|
|
17.6p |
|
20.7p |
|
-15% |
Earnings per share |
67.3p |
|
91.6p |
|
-27% |
|
|
|
|
|
|
|
|
|
|
|
|
|
1 093 |
|
3 117 |
|
-65% |
Capital investment |
5 205 |
|
5 444 |
|
-4% |
Fourth quarter
Weaker prices caused a decline in revenue and other operating income of 10%. The fall in prices was partially offset by the positive effects of 8% growth in E&P production volumes and the recovery of past gas costs at Comgás, in Brazil, resulting in a 3% fall in total operating profit to £1 108 million.
Cash generated by operations was £1 329 million (2008 £1 922 million). Net finance costs for the quarter were £36 million.
Capital investment in the quarter of £1 093 million reflected continuing investment in E&P (£724 million), LNG (£172 million), T&D (£49 million) and Power (£148 million).
Full year
Lower gas and oil prices resulted in an 18% fall in revenue and other operating income. Despite a 37% drop in Brent oil prices and a 53% fall in Henry Hub gas prices, total operating profit was 21% lower as these price declines were partially offset by a 4% increase in E&P production volumes, a strong performance from the LNG segment, the recovery of past gas costs at Comgás and the effect of a stronger US Dollar.
Net finance costs were £144 million and included foreign exchange gains of £25 million.
The Group's effective tax rate (including BG Group's share of joint ventures and associates tax) was 42.0% (2008 42.5%) for the full year.
Cash generated by operations was £4 895 million (2008 £6 274 million). As at 31 December 2009, net debt was £2 956 million and the gearing ratio of the Group was 17%.
Earnings per share were 67.3 pence.
Capital investment (including acquisitions) in the year was £5 205 million and comprised investment in E&P (£4 226 million), LNG (£653 million), T&D (£151 million) and Power (£175 million).
In considering the dividend level the Board takes account of the outlook for earnings growth, cash flow and financial gearing. Taking these factors into account, the Board has recommended a final dividend of 6.73 pence per share, bringing the full year dividend to 12.35 pence per share, an increase of 10% compared with last year.
Disposals, re-measurements and impairments
A post-tax charge of £127 million for the quarter and £95 million for the full year was recorded in respect of disposals, re-measurements and impairments. For further information, see note 2 (page 18).
US Dollar reporting
As previously announced, from the first quarter of 2010, BG Group will report its results in US Dollars. Exploration and Production (E&P)
|
Fourth Quarter |
|
|
|
Full Year |
|
|
||||
|
2009 £m |
|
2008 £m |
|
|
Business Performance |
2009 £m |
|
2008 £m |
|
|
|
61.9 |
|
57.3 |
|
+8% |
Production volumes (mmboe) |
234.9 |
|
226.7 |
|
+4% |
|
|
|
|
|
|
|
|
|
|
|
|
|
1 319 |
|
1 289 |
|
+2% |
Revenue and other operating income |
4 811 |
|
5 682 |
|
-15% |
|
|
|
|
|
|
|
|
|
|
|
|
|
751 |
|
822 |
|
-9% |
Total operating profit before exploration charge |
2 687 |
|
3 963 |
|
-32% |
|
(172) |
|
(145) |
|
+19% |
Exploration charge |
(600) |
|
(451) |
|
+33% |
|
579 |
|
677 |
|
-14% |
Total operating profit |
2 087 |
|
3 512 |
|
-41% |
|
|
|
|
|
|
|
|
|
|
|
|
|
724 |
|
2 927 |
|
-75% |
Capital investment |
4 226 |
|
4 952 |
|
-15% |
Additional operating and financial data is given on page 26.
Fourth quarter
A 39% fall in the Group's average realised gas price was offset by an 8% increase in production volumes and higher oil prices resulting in a 2% increase in revenue and other operating income. Total operating profit (down 14%) was also impacted by higher exploration and depreciation charges. Volume growth for the quarter was held back by continued weakness in demand and the delayed start-up of Hasdrubal in Tunisia.
Unit operating expenditure fell by 15 cents (2%) to $6.40 per barrel of oil equivalent.
The 39% fall in the Group's average realised gas price per produced therm to 19.8 pence reflected the 50% fall in the UK gas price and the 23% fall in the Henry Hub price compared with the fourth quarter of 2008.
The exploration charge of £172 million reflected increased exploration activity.
Capital investment of £724 million comprised investment in Africa, Middle East & Asia (£221 million), Americas (£219 million), Europe and Central Asia (£193 million) and Australia (£91 million). In 2008, capital investment included £2 069 million on the acquisition of Queensland Gas Company Limited.
Full year
E&P total operating profit of £2 087 million was 41% lower as Brent oil prices fell by 37% and the Group's average realised gas price per produced therm fell by 16% compared with the previous year. The benefit of 4% higher production volumes and a stronger US Dollar partially offset the impact of sharply lower market prices and higher exploration and depreciation charges.
Production growth of 4% was below original expectations principally due to weakness in demand and the delay to the start-up of the Hasdrubal project. In 2010, BG Group expects only slight production volume growth due to weak demand conditions which the Group expects to continue through the year.
Unit operating expenditure fell by 43 cents (7%) to $5.97 per barrel of oil equivalent for the full year.
The exploration charge of £600 million is £149 million higher than 2008 reflecting the write off of certain non-core exploration properties earlier in the year and a higher write off charge associated with activity in Nigeria.
Capital investment of £4 226 million comprised investment in Americas (£1 443 million), Africa, Middle East and Asia (£1 333 million), Europe and Central Asia (£736 million) and Australia (£714 million).
Fourth quarter business highlights
Brazil
In November, BG Group announced that the Iracema appraisal well on BM-S-11 (BG Group 25%) confirmed the presence of an excellent oil and gas bearing reservoir. The well in-flow performance recorded during the tests was the highest so far achieved in BG Group's Santos Basin interests. Development well flow rates of up to 50 000 boed are anticipated; these rates being constrained by production facilities. Further evaluation of the well data is on-going and work on field development options has been initiated.
The Tupi North-East appraisal well on BM-S-11 encountered hydrocarbons in November and reinforces the partners' estimates that the Tupi accumulation holds five to eight billion boe of gross reserves and resources. Also on BM-S-11, formation tests on the Iara well confirmed the presence of producible light oil.
In January 2010, BG Group and its partners, Petrobras and Repsol, signed a Letter of Intent for the construction and leasing of a Floating, Production, Storage and Off-Loading (FPSO) vessel for the Guará development on BM-S-9 in the Santos Basin. The FPSO, with a production capacity of 120 000 bopd of oil and 175 mmscfd of gas, is expected to start up in early 2013. The lease is for a 20-year term.
Tunisia
Hasdrubal (BG Group 50%) came onstream in December, later than anticipated due to the commissioning of onshore plant systems taking longer than expected. Hasdrubal gas and butane will be sold to the domestic market, with condensate, oil and propane being exported. Hasdrubal production is now ramping up towards full capacity.
China
In December, BG Group signed a further PSC with China National Offshore Oil Corporation (CNOOC) covering Block 63/16, offshore China. Under the terms of the PSC, BG Group will be the operator and have a 100% interest during the exploration phase. In the event of a commercial discovery, CNOOC has an option to take an interest in the field. The agreement is subject to final government approval. BG Group will commence an extensive 3D seismic acquisition programme in the first half of 2010. Block 63/16 is BG Group's third block in the South China Sea and strengthens BG Group's interest in a prospective basin close to the southern China market.
Liquefied Natural Gas (LNG)
|
Fourth Quarter |
|
|
|
Full Year |
|
|
||||
|
2009 £m |
|
2008 £m |
|
|
Business Performance |
2009 £m |
|
2008 £m |
|
|
|
931 |
|
1 305 |
|
-29% |
Revenue and other operating income |
3 908 |
|
5 426 |
|
-28% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating profit |
|
|
|
|
|
|
332 |
|
445 |
|
-25% |
Shipping and marketing |
1 434 |
|
1 524 |
|
-6% |
|
51 |
|
46 |
|
+11% |
Liquefaction |
211 |
|
145 |
|
+46% |
|
(25) |
|
(35) |
|
-29% |
Business development and other |
(94) |
|
(84) |
|
+12% |
|
358 |
|
456 |
|
-21% |
|
1 551 |
|
1 585 |
|
-2% |
|
|
|
|
|
|
|
|
|
|
|
|
|
172 |
|
110 |
|
+56% |
Capital investment |
653 |
|
273 |
|
+139% |
Additional operating and financial data is given on page 26.
Fourth quarter
LNG total operating profit for the quarter was £358 million.
Shipping and marketing operating profit of £332 million was 25% lower, reflecting lower realisations, partially offset by higher volumes.
BG Group's share of operating profit from liquefaction activities increased by £5 million to £51 million principally due to higher profits at Egyptian LNG.
Capital investment of £172 million in the quarter included £137 million relating to LNG ships, £26 million in Australia and £4 million in Chile.
Full year
LNG total operating profit for the year of £1 551 million was broadly in line with 2008, notwithstanding a 37% and 53% drop in the Brent oil price and Henry Hub gas price respectively. Operating profit benefited from a more favourable US$/UK£ exchange rate, a 3% increase in managed volumes, term sales and an effective price risk management programme.
BG Group's share of operating profit from liquefaction activities increased by £66 million to £211 million due to higher profits at Egyptian LNG and the impact of the stronger US$/UK£ exchange rate.
Capital investment of £653 million in the full year included £406 million relating to LNG ships, £85 million in Australia, £61 million relating to infrastructure enhancement at Lake Charles in the USA, £46 million in Chile and £39 million in the UK.
Fourth quarter business highlights
In November, BG Group announced a joint venture agreement to study a Floating Liquefied Natural Gas (FLNG) vessel as an additional option to commercialise the material associated natural gas reserves in the Santos Basin pre-salt, offshore Brazil. Further to the agreement, Front-End Engineering and Design (FEED) contracts have been awarded to three consortia for a FLNG vessel. The consortia will prepare FEED proposals through 2010 and a Final Investment Decision is anticipated in 2011. The partners in the joint venture are Petrobras (51.1%) and BG Group, Galp Energia and Repsol (all 16.3%).
The FLNG vessel will operate close to the planned Santos Basin FPSO vessels. The 3 mtpa LNG produced would be shipped either to Petrobras-operated regasification terminals at Pecém and Guanabara Bay to supply the Brazilian domestic market or exported to international markets.
Transmission and Distribution (T&D)
|
Fourth Quarter |
|
|
|
Full Year |
|
|
||||
|
2009 £m |
|
2008 £m |
|
|
Business Performance |
2009 £m |
|
2008 £m |
|
|
|
|
|
|
|
|
Revenue and other operating income |
|
|
|
|
|
|
340 |
|
319 |
|
+7% |
Comgás |
1 232 |
|
1 206 |
|
+2% |
|
53 |
|
42 |
|
+26% |
Other |
201 |
|
177 |
|
+14% |
|
393 |
|
361 |
|
+9% |
|
1 433 |
|
1 383 |
|
+4% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating profit |
|
|
|
|
|
|
105 |
|
(15) |
|
- |
Comgás |
381 |
|
115 |
|
+231% |
|
11 |
|
9 |
|
+22% |
Other |
45 |
|
45 |
|
- |
|
116 |
|
(6) |
|
- |
|
426 |
|
160 |
|
+166% |
|
|
|
|
|
|
|
|
|
|
|
|
|
49 |
|
38 |
|
+29% |
Capital investment |
151 |
|
136 |
|
+11% |
Fourth quarter
T&D total operating profit for the quarter increased by £122 million to £116 million.
At Comgás, in Brazil, total operating profit increased by £120 million to £105 million reflecting the continuing recovery of past gas costs which more than offset lower demand in the power and vehicle segments.
At the end of the quarter, the cost of gas to be recovered in future periods was £12 million (£161 million at the end of 2008).
Capital investment mainly represents the development of the Comgás pipeline network.
Full year
T&D total operating profit increased by £266 million to £426 million. At Comgás, total operating profit of £381 million was £266 million higher principally due to the recovery of gas costs incurred in earlier periods.
Capital investment mainly represents the development of the Comgás pipeline network.
Power Generation
|
Fourth Quarter |
|
|
|
Full Year |
|
|
||||
|
2009 £m |
|
2008 £m |
|
|
Business Performance |
2009 £m |
|
2008 £m |
|
|
|
151 |
|
166 |
|
-9% |
Revenue and other operating income |
528 |
|
622 |
|
-15% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating profit |
|
|
|
|
|
|
59 |
|
29 |
|
+103% |
Power Generation |
171 |
|
136 |
|
+26% |
|
(4) |
|
(8) |
|
-50% |
Business development and other |
(13) |
|
(18) |
|
-28% |
|
55 |
|
21 |
|
+162% |
|
158 |
|
118 |
|
+34% |
|
|
|
|
|
|
|
|
|
|
|
|
|
148 |
|
42 |
|
+252% |
Capital investment |
175 |
|
82 |
|
+113% |
Fourth quarter & full year results
Revenue and other operating income fell by 9% in the quarter and 15% in the full year primarily due to the pass through of lower gas costs.
Total operating profit increased by £34 million in the quarter and by £40 million in the full year. Both the quarter and the full year results reflected improved operating performance in Italy and the USA during 2009, the effects of a turbine failure at Seabank in 2008 and favourable exchange rates.
Presentation of Non-GAAP measures
|
|
Business Performance'Business Performance' excludes disposals, certain re-measurements and impairments (see below) as exclusion of these items provides a clear and consistent presentation of the underlying operating performance of the Group's ongoing business. BG Group uses commodity instruments to manage price exposures associated with its marketing and optimisation activity in the UK and US. This activity enables the Group to take advantage of commodity price movements. It is considered more appropriate to include both unrealised and realised gains and losses arising from the mark-to-market of derivatives associated with this activity in 'Business Performance'. Disposals, certain re-measurements and impairmentsBG Group's commercial arrangements for marketing gas include the use of long-term gas sales contracts. Whilst the activity surrounding these contracts involves the physical delivery of gas, certain UK gas sales contracts are classified as derivatives under the rules of IAS 39 and are required to be measured at fair value at the balance sheet date. Unrealised gains and losses on these contracts reflect the comparison between current market gas prices and the actual prices to be realised under the gas sales contract and are disclosed separately as 'disposals, re-measurements and impairments'. BG Group also uses commodity instruments to manage certain price exposures in respect of optimising the timing and location of its physical gas and LNG sales commitments. These instruments are also required to be measured at fair value at the balance sheet date under IAS 39 and where practical have been designated as formal hedges. However, IAS 39 does not always allow the matching of fair values to the economically hedged value of the related commodity, resulting in unrealised movements in fair value being recorded in the income statement. These movements in fair value, together with any unrealised gains and losses associated with discontinued hedge accounting relationships that continue to represent economic hedges, are disclosed separately as 'disposals, re-measurements and impairments'. BG Group also uses financial instruments, including derivatives, to manage foreign exchange and interest rate exposure. These instruments are required to be recognised at fair value or amortised cost on the balance sheet in accordance with IAS 39. Most of these instruments have been designated either as hedges of foreign exchange movements associated with the Group's net investments in foreign operations, or as hedges of interest rate risk. Where these instruments cannot be designated as hedges under IAS 39, unrealised movements in fair value are recorded in the income statement and disclosed separately as 'disposals, re-measurements and impairments'. Realised gains and losses relating to the instruments referred to above are included in Business Performance. This presentation best reflects the underlying performance of the business since it distinguishes between the temporary timing differences associated with re-measurements under IAS 39 rules and actual realised gains and losses. BG Group has also separately identified profits and losses associated with the disposal of non-current assets, and impairments of non-current assets as they require separate disclosure in order to provide a clearer understanding of the results for the period. For a reconciliation between the overall results and Business Performance and details of disposals, re-measurements and impairments, see the consolidated income statements, pages 11 and 12, note 2 (page 18) and note 3 (page 19). Joint ventures and associatesUnder IFRS the results from jointly controlled entities (joint ventures) and associates, accounted for under the equity method, are required to be presented net of finance costs and tax on the face of the income statement. Given the relevance of these businesses within BG Group, the results of joint ventures and associates are presented before interest and tax, and after tax. This approach provides additional information on the source of BG Group's operating profits. For a reconciliation between operating profit and earnings including and excluding the results of joint ventures and associates, see note 3 (page 19). Net borrowings/fundsBG Group provides a reconciliation of net borrowings/funds and an analysis of the amounts included within net borrowings/funds as this is an important liquidity measure for the Group. |
|
Legal Notice
|
|
Certain statements included in these results contain forward-looking information concerning BG Group's strategy, operations, financial performance or condition, outlook, growth opportunities or circumstances in the countries, sectors or markets in which BG Group operates. By their nature, forward-looking statements involve uncertainty because they depend on future circumstances, and relate to events, not all of which are within BG Group's control or can be predicted by BG Group. Although BG Group believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Actual results could differ materially from those set out in the forward-looking statements. For a detailed analysis of the factors that may affect our business, financial performance or results of operations, we urge you to look at the 'Risk Factors' included in BG Group plc's Annual Report and Accounts 2008. No part of these results constitutes, or shall be taken to constitute, an invitation or inducement to invest in BG Group plc or any other entity, and must not be relied upon in any way in connection with any investment decision. BG Group undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent legally required. Please note that these results should be read in conjunction with BG Group's 2010 Strategy Presentation which has also been issued today. The 2010 Strategy Presentation is available for viewing at www.bg-group.com
|
|
Consolidated Income Statement
Fourth Quarter
|
|
|
|
2009 |
|
2008 |
|
||||
|
|
|
Notes |
Business Perform-ance(a) £m |
Disposals, re-measure- ments and impairments (Note 2)(a) £m |
Total Result £m |
|
Business Perform- ance(a) £m |
Disposals, re-measure- ments and impairments (Note 2)(a) £m |
Total Result £m |
|
|
|
Group revenue |
|
2 646 |
- |
2 646 |
|
2 955 |
- |
2 955 |
|
|
|
Other operating income |
2 |
56 |
31 |
87 |
|
34 |
138 |
172 |
|
|
|
Group revenue and other operating income |
3 |
2 702 |
31 |
2 733 |
|
2 989 |
138 |
3 127 |
|
|
|
Operating costs |
|
(1 677) |
- |
(1 677) |
|
(1 921) |
- |
(1 921) |
|
|
|
Profits and losses on disposal of non-current assets and impairments |
2 |
- |
(213) |
(213) |
|
- |
(6) |
(6) |
|
|
|
Operating profit/(loss)(b) |
3 |
1 025 |
(182) |
843 |
|
1 068 |
132 |
1 200 |
|
|
|
Finance income |
2, 4 |
15 |
(38) |
(23) |
|
77 |
30 |
107 |
|
|
|
Finance costs |
2, 4 |
(37) |
31 |
(6) |
|
(37) |
(40) |
(77) |
|
|
|
Share of post-tax results from joint ventures and associates |
3 |
43 |
- |
43 |
|
40 |
- |
40 |
|
|
|
Profit/(loss) before tax |
|
1 046 |
(189) |
857 |
|
1 148 |
122 |
1 270 |
|
|
|
Taxation |
2, 5 |
(425) |
62 |
(363) |
|
(460) |
(61) |
(521) |
|
|
|
Profit/(loss) for the period |
3 |
621 |
(127) |
494 |
|
688 |
61 |
749 |
|
|
|
Attributable to: |
|
|
|
|
|
|
|
|
|
|
|
BG Group shareholders (earnings) |
|
592 |
(127) |
465 |
|
695 |
61 |
756 |
|
|
|
Minority interest |
|
29 |
- |
29 |
|
(7) |
- |
(7) |
|
|
|
|
|
621 |
(127) |
494 |
|
688 |
61 |
749 |
|
|
|
Earnings per share - basic |
6 |
17.6p |
(3.8p) |
13.8p |
|
20.7p |
1.8p |
22.5p |
|
|
|
Earnings per share - diluted |
6 |
17.4p |
(3.7p) |
13.7p |
|
20.6p |
1.8p |
22.4p |
|
|
|
Total operating profit/(loss) including share of pre-tax operating results from joint ventures and associates(c) |
3 |
1 108 |
(182) |
926 |
|
1 139 |
132 |
1 271 |
|
a) See Presentation of Non-GAAP measures, page 9, for an explanation of results excluding disposals, certain re-measurements and impairments and presentation of the results of joint ventures and associates.
b) Operating profit/(loss) is before share of results from joint ventures and associates.
c) This measurement is shown by BG Group as it is used as a means of measuring the underlying performance of the business.
Consolidated Income Statement
Full Year
|
|
|
|
2009 |
|
2008 |
|
||||
|
|
|
Notes |
Business Perform-ance(a) £m |
Disposals, re-measure- ments and impairments (Note 2)(a) £m |
Total Result £m |
|
Business Perform- ance(a) £m |
Disposals, re-measure- ments and impairments (Note 2)(a) £m |
Total Result £m |
|
|
|
Group revenue |
|
10 213 |
- |
10 213 |
|
12 566 |
- |
12 566 |
|
|
|
Other operating income |
2 |
150 |
105 |
255 |
|
36 |
157 |
193 |
|
|
|
Group revenue and other operating income |
3 |
10 363 |
105 |
10 468 |
|
12 602 |
157 |
12 759 |
|
|
|
Operating costs |
|
(6 482) |
- |
(6 482) |
|
(7 496) |
- |
(7 496) |
|
|
|
Profits and losses on disposal of non-current assets and impairments |
2 |
- |
(213) |
(213) |
|
- |
(24) |
(24) |
|
|
|
Operating profit/(loss)(b) |
3 |
3 881 |
(108) |
3 773 |
|
5 106 |
133 |
5 239 |
|
|
|
Finance income |
2, 4 |
63 |
4 |
67 |
|
227 |
49 |
276 |
|
|
|
Finance costs |
2, 4 |
(160) |
(22) |
(182) |
|
(150) |
(55) |
(205) |
|
|
|
Share of post-tax results from joint ventures and associates |
3 |
204 |
- |
204 |
|
158 |
- |
158 |
|
|
|
Profit/(loss) before tax |
|
3 988 |
(126) |
3 862 |
|
5 341 |
127 |
5 468 |
|
|
|
Taxation |
2, 5 |
(1 629) |
31 |
(1 598) |
|
(2 248) |
(70) |
(2 318) |
|
|
|
Profit/(loss) for the year |
|
2 359 |
(95) |
2 264 |
|
3 093 |
57 |
3 150 |
|
|
|
Attributable to: |
|
|
|
|
|
|
|
|
|
|
|
BG Group shareholders (earnings) |
|
2 263 |
(95) |
2 168 |
|
3 068 |
59 |
3 127 |
|
|
|
Minority interest |
|
96 |
- |
96 |
|
25 |
(2) |
23 |
|
|
|
|
|
2 359 |
(95) |
2 264 |
|
3 093 |
57 |
3 150 |
|
|
|
Earnings per share - basic |
6 |
67.3p |
(2.8p) |
64.5p |
|
91.6p |
1.8p |
93.4p |
|
|
|
Earnings per share - diluted |
6 |
66.8p |
(2.8p) |
64.0p |
|
90.7p |
1.8p |
92.5p |
|
|
|
Total operating profit/(loss) including share of pre-tax operating results from joint ventures and associates(c) |
3 |
4 211 |
(108) |
4 103 |
|
5 355 |
133 |
5 488 |
|
a) See Presentation of Non-GAAP measures, page 9, for an explanation of results excluding disposals, certain re-measurements and impairments and presentation of the results of joint ventures and associates.
b) Operating profit/(loss) is before share of results from joint ventures and associates.
c) This measurement is shown by BG Group as it is used as a means of measuring the underlying performance of the business.
Consolidated Statement of Comprehensive Income
|
Fourth Quarter |
|
|
Full Year |
||
|
2009 £m |
2008 £m |
|
|
2009 £m |
2008 £m |
|
494 |
749 |
|
Profit for the period |
2 264 |
3 150 |
|
|
|
|
|
|
|
|
(148) |
644 |
|
Hedge adjustments net of tax(a) |
(477) |
519 |
|
(2) |
(30) |
|
Fair value movements on 'available-for-sale' assets net of tax(b) |
2 |
- |
|
97 |
1 853 |
|
Currency translation adjustments |
36 |
2 181 |
|
(53) |
2 467 |
|
Other comprehensive income/(expense), net of tax |
(439) |
2 700 |
|
|
|
|
|
|
|
|
441 |
3 216 |
|
Total comprehensive income for the period |
1 825 |
5 850 |
|
|
|
|
|
|
|
|
|
|
|
Attributable to: |
|
|
|
408 |
3 218 |
|
BG Group shareholders |
1 715 |
5 820 |
|
33 |
(2) |
|
Minority interest |
110 |
30 |
|
441 |
3 216 |
|
|
1 825 |
5 850 |
a) Income tax relating to hedge adjustments is a £58 million credit for the quarter (2008 £250 million charge) and a £186 million credit for the full year (2008 £202 million charge).
b) Income tax relating to fair value movements on 'available-for-sale' assets is a £1 million credit for the quarter (2008 £12 million credit) and a £1 million credit for the full year (2008 £nil).
Consolidated Balance Sheet
|
|
As at 31 Dec 2009 £m |
As at 31 Dec 2008 £m |
|
Assets |
|
|
|
Non-current assets |
|
|
|
Goodwill |
483 |
417 |
|
Other intangible assets |
4 759 |
3 713 |
|
Property, plant and equipment |
13 460 |
11 288 |
|
Investments |
1 828 |
1 631 |
|
Deferred tax assets |
85 |
77 |
|
Trade and other receivables |
78 |
95 |
|
Commodity contracts and other derivative financial instruments |
377 |
935 |
|
|
21 070 |
18 156 |
|
Current assets |
|
|
|
Inventories |
476 |
562 |
|
Trade and other receivables |
2 923 |
3 616 |
|
Current tax receivable |
107 |
91 |
|
Commodity contracts and other derivative financial instruments |
1 013 |
1 538 |
|
Cash and cash equivalents |
693 |
1 033 |
|
|
5 212 |
6 840 |
|
Total assets |
26 282 |
24 996 |
|
|
|
|
|
Liabilities |
|
|
|
Current liabilities |
|
|
|
Borrowings |
(717) |
(281) |
|
Trade and other payables |
(2 592) |
(3 632) |
|
Current tax liabilities |
(978) |
(1 122) |
|
Commodity contracts and other derivative financial instruments |
(861) |
(1 453) |
|
|
(5 148) |
(6 488) |
|
Non-current liabilities |
|
|
|
Borrowings |
(3 111) |
(1 897) |
|
Trade and other payables |
(39) |
(38) |
|
Commodity contracts and other derivative financial instruments |
(526) |
(528) |
|
Deferred income tax liabilities |
(1 949) |
(2 056) |
|
Retirement benefit obligations |
(172) |
(178) |
|
Provisions for other liabilities and charges |
(952) |
(927) |
|
|
(6 749) |
(5 624) |
|
Total liabilities |
(11 897) |
(12 112) |
|
Net assets |
14 385 |
12 884 |
|
Equity |
|
|
|
Total shareholders' equity |
14 186 |
12 758 |
|
Minority interest in equity |
199 |
126 |
|
Total equity |
14 385 |
12 884 |
Consolidated Statement of Changes in Equity
|
|
|
Called up share capital £m |
Share premium account £m |
Hedging reserve £m |
Translation reserve £m |
Other reserves £m |
Retained earnings £m |
Total £m |
Minority Interest £m |
Total £m |
|
|
Equity as at 31 December 2008 |
358 |
192 |
540 |
1 950 |
1 702 |
8 016 |
12 758 |
126 |
12 884 |
|
|
Total comprehensive income for the year |
- |
- |
(490) |
35 |
- |
2 170 |
1 715 |
110 |
1 825 |
|
|
Issue of shares |
2 |
61 |
- |
- |
- |
- |
63 |
- |
63 |
|
|
Purchase of own shares |
- |
- |
- |
- |
- |
(3) |
(3) |
- |
(3) |
|
|
Adjustment in respect of employee share schemes |
- |
- |
- |
- |
- |
62 |
62 |
- |
62 |
|
|
Dividends on ordinary shares |
- |
- |
- |
- |
- |
(409) |
(409) |
- |
(409) |
|
|
Dividends paid to minority interest |
- |
- |
- |
- |
- |
- |
- |
(37) |
(37) |
|
|
Equity as at 31 December 2009 |
360 |
253 |
50 |
1 985 |
1 702 |
9 836 |
14 186 |
199 |
14 385 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Called up share capital £m |
Share premium account £m |
Hedging reserve £m |
Translation reserve £m |
Other reserves £m |
Retained earnings £m |
Total £m |
Minority Interest £m |
Total £m |
|
|
Equity as at 31 December 2007 |
358 |
165 |
(39) |
(164) |
1 702 |
5 203 |
7 225 |
132 |
7 357 |
|
|
Total comprehensive income for the year |
- |
- |
579 |
2 114 |
- |
3 127 |
5 820 |
30 |
5 850 |
|
|
Issue of shares |
- |
27 |
- |
- |
- |
- |
27 |
- |
27 |
|
|
Adjustment in respect of employee share schemes |
- |
- |
- |
- |
- |
35 |
35 |
- |
35 |
|
|
Disposal of minority interest |
- |
- |
- |
- |
- |
- |
- |
(1) |
(1) |
|
|
Dividends on ordinary shares |
- |
- |
- |
- |
- |
(349) |
(349) |
- |
(349) |
|
|
Dividends paid to minority interest |
- |
- |
- |
- |
- |
- |
- |
(35) |
(35) |
|
|
Equity as at 31 December 2008 |
358 |
192 |
540 |
1 950 |
1 702 |
8 016 |
12 758 |
126 |
12 884 |
Consolidated Cash Flow Statement
|
Fourth Quarter |
|
|
Full Year |
||
|
2009 £m |
2008 £m |
|
|
2009 £m |
2008 £m |
|
|
|
|
Cash flows from operating activities |
|
|
|
857 |
1 270 |
|
Profit before tax |
3 862 |
5 468 |
|
(43) |
(40) |
|
Share of post-tax results from joint ventures and associates |
(204) |
(158) |
|
282 |
251 |
|
Depreciation of property, plant and equipment and amortisation of intangible assets |
1 131 |
880 |
|
(37) |
(127) |
|
Fair value movements in commodity based contracts |
(111) |
(185) |
|
213 |
6 |
|
Profits and losses on disposal of non-current assets and impairments |
213 |
24 |
|
98 |
90 |
|
Unsuccessful exploration expenditure written off |
349 |
240 |
|
(6) |
6 |
|
(Decrease)/increase in provisions |
(43) |
(3) |
|
23 |
(107) |
|
Finance income |
(67) |
(276) |
|
6 |
77 |
|
Finance costs |
182 |
205 |
|
12 |
11 |
|
Share-based payments |
41 |
34 |
|
(76) |
485 |
|
(Increase)/decrease in working capital |
(458) |
45 |
|
1 329 |
1 922 |
|
Cash generated by operations |
4 895 |
6 274 |
|
(321) |
(655) |
|
Income taxes paid |
(1 351) |
(1 883) |
|
1 008 |
1 267 |
|
Net cash inflow from operating activities |
3 544 |
4 391 |
|
|
|
|
Cash flows from investing activities |
|
|
|
40 |
74 |
|
Dividends received from joint ventures and associates |
145 |
151 |
|
- |
- |
|
Proceeds from disposal of subsidiary undertakings and investments |
- |
15 |
|
1 |
- |
|
Proceeds from disposal of property, plant and equipment and intangible assets |
3 |
2 |
|
(1 062) |
(862) |
|
Purchase of property, plant and equipment and intangible assets |
(4 328) |
(2 796) |
|
(7) |
(41) |
|
Loans to joint ventures and associates |
(65) |
(125) |
|
(1) |
(1 885) |
|
Business combinations and investments |
(736) |
(2 061) |
|
(1 029) |
(2 714) |
|
Net cash outflow from investing activities |
(4 981) |
(4 814) |
|
|
|
|
Cash flows from financing activities |
|
|
|
(34) |
(14) |
|
Net interest (paid)/received(a) |
(106) |
(19) |
|
(3) |
(2) |
|
Dividends paid |
(407) |
(348) |
|
(16) |
(7) |
|
Dividends paid to minority |
(36) |
(35) |
|
82 |
102 |
|
Net proceeds from issue and repayment of borrowings |
1 620 |
(71) |
|
28 |
12 |
|
Issue of shares |
63 |
27 |
|
- |
- |
|
Purchase of own shares |
(3) |
(197) |
|
57 |
91 |
|
Net cash inflow/(outflow) from financing activities |
1 131 |
(643) |
|
36 |
(1 356) |
|
Net increase/(decrease) in cash and cash equivalents |
(306) |
(1 066) |
|
664 |
2 198 |
|
Cash and cash equivalents at beginning of period |
1 033 |
1 881 |
|
(7) |
191 |
|
Effect of foreign exchange rate changes |
(34) |
218 |
|
693 |
1 033 |
|
Cash and cash equivalents at end of period(b) |
693 |
1 033 |
a) Includes capitalised interest for the fourth quarter of £11 million (2008 £5 million), and for the full year of £31 million (2008 £22 million).
b) Cash and cash equivalents comprise cash and short-term liquid investments that are readily convertible to cash.
Notes
1. Basis of preparation
These primary statements are the unaudited preliminary consolidated financial statements ('the financial statements') of BG Group plc for the quarter ended and the full year ended 31 December 2009. The financial statements do not comprise statutory accounts within the meaning of Section 434 of the Companies Act 2006, and should be read in conjunction with the Annual Report and Accounts for the year ended 31 December 2008 which have been prepared in accordance with IFRSs as adopted by the EU, as they provide an update of previously reported information. The latest statutory accounts delivered to the registrar were for the year ended 31 December 2008 which were audited by BG Group's statutory auditors PricewaterhouseCoopers LLP and on which the Auditors' Report was unqualified and did not contain statements under 237(2) or 237(3) of the UK Companies Act 1985. These financial statements have been prepared in accordance with the requirements of the Disclosure and Transparency Rules issued by the Financial Services Authority and the accounting policies set out in the 2008 Annual Report and Accounts (except as disclosed below).
The preparation of the financial statements requires management to make estimates and assumptions that affect the reported amount of revenues, expenses, assets and liabilities at the date of the financial statements. If in the future such estimates and assumptions, which are based on management's best judgement at the date of the financial statements, deviate from the actual circumstances, the original estimates and assumptions will be modified as appropriate in the year in which the circumstances change.
Presentation of results
The presentation of BG Group's results separately identifies the effect of:
·; The re-measurement of certain financial instruments; and
·; Profits and losses on the disposal and impairment of non-current assets and businesses.
These items, which are detailed in note 2 to the financial statements, page 18, are excluded from Business Performance in order to provide readers with a clear and consistent presentation of the underlying operating performance of the Group's ongoing businesses.
New accounting standards and interpretations
IAS 1 (revised) 'Presentation of Financial Statements' is applicable to BG Group for the period beginning 1 January 2009. In accordance with this standard, the Group has continued to report a separate 'Consolidated Income Statement' and has reported a separate 'Consolidated Statement of Comprehensive Income' in place of a 'Consolidated Statement of Recognised Income and Expense'. In addition, the Group has presented a 'Consolidated Statement of Changes in Equity' as part of its primary financial statements in these full year financial statements and will also present this in the 2009 Annual Report and Accounts.
A number of other amendments to accounting standards and new interpretations issued by the IASB are applicable from 1 January 2009. They have not had a material impact on the accounting policies, methods of computation and presentation applied by the Group.
2. Disposals, re-measurements and impairments
|
Fourth Quarter |
|
|
Full Year |
||
|
2009 £m |
2008 £m |
|
|
2009 £m |
2008 £m |
|
31 |
138 |
|
Revenue and other operating income - re-measurements of commodity based contracts |
105 |
157 |
|
(213) |
(6) |
|
Profits and losses on disposal of non-current assets and impairments |
(213) |
(24) |
|
(7) |
(10) |
|
Net finance costs - re-measurements of financial instruments |
(18) |
(6) |
|
62 |
(61) |
|
Taxation |
31 |
(70) |
|
- |
- |
|
Minority interest |
- |
2 |
|
(127) |
61 |
|
Impact on earnings |
(95) |
59 |
Fourth quarter and full year: Revenue and other operating income
Re-measurements included within revenue and other operating income amount to a credit of £31 million for the quarter (2008 £138 million credit), of which a charge of £9 million (2008 £114 million credit) represents non-cash mark-to-market movements on certain long-term UK gas contracts. For the full year, a credit of £105 million in respect of re-measurements is included within revenue and other operating income (2008 £157 million credit), of which a credit of £53 million represents non-cash mark-to-market movements on certain long-term UK gas contracts (2008 £131 million credit). Whilst the activity surrounding these contracts involves the physical delivery of gas, the contracts fall within the scope of IAS 39 and meet the definition of a derivative instrument.
Fourth quarter and full year: Net finance costs
Re-measurements presented in net finance costs include certain derivatives used to hedge foreign exchange and interest rate risk, partly offset by foreign exchange movements on certain borrowings.
Fourth quarter and full year: Disposals and impairments of non-current assets
During the fourth quarter, a pre-tax impairment charge of £214 million (post-tax charge £147 million) was recognised against certain assets in the E&P (£131 million) and Power (£83 million) segments.
Also during the quarter, plant write-offs and disposals resulted in a pre and post-tax credit to the income statement of £1 million.
2008 fourth quarter and full year: Disposals and impairments of non-current assets
During the fourth quarter of 2008, BG Group wrote off certain items of plant resulting in a pre and post-tax charge to the income statement of £6 million.
During the third quarter of 2008, BG Group disposed of certain non-core businesses. This resulted in a pre and post-tax credit to the income statement of £5 million. During the first quarter of 2008, BG Group committed to a plan to dispose of these businesses and as a result these businesses were revalued to the lower of their carrying amount and fair value less costs to sell. This resulted in a pre and post-tax charge to the income statement of £21 million. Also during prior quarters, other plant write-offs and disposals resulted in a pre-tax charge to the income statement of £2 million (post-tax charge £1 million).
3. Segmental analysis
|
Profit for the period |
Business Performance |
Disposals, re-measurements and impairments |
Total Result |
|||
|
Analysed by operating segment |
||||||
|
Fourth Quarter |
2009 £m |
2008 £m |
2009 £m |
2008 £m |
2009 £m |
2008 £m |
|
Group revenue(a) |
|
|
|
|
|
|
|
Exploration and Production |
1 308 |
1 270 |
- |
- |
1 308 |
1 270 |
|
Liquefied Natural Gas |
887 |
1 290 |
- |
- |
887 |
1 290 |
|
Transmission and Distribution |
393 |
361 |
- |
- |
393 |
361 |
|
Power Generation |
150 |
166 |
- |
- |
150 |
166 |
|
Other activities |
- |
- |
- |
- |
- |
- |
|
Less: intra-group sales |
(92) |
(132) |
- |
- |
(92) |
(132) |
|
Group revenue |
2 646 |
2 955 |
- |
- |
2 646 |
2 955 |
|
Other operating income(b) |
56 |
34 |
31 |
138 |
87 |
172 |
|
Group revenue and other operating income |
2 702 |
2 989 |
31 |
138 |
2 733 |
3 127 |
|
Operating profit/(loss) before share of results from joint ventures and associates |
||||||
|
Exploration and Production |
580 |
677 |
(142) |
132 |
438 |
809 |
|
Liquefied Natural Gas |
304 |
411 |
43 |
- |
347 |
411 |
|
Transmission and Distribution |
109 |
(13) |
- |
- |
109 |
(13) |
|
Power Generation |
32 |
2 |
(83) |
- |
(51) |
2 |
|
Other activities |
- |
(9) |
- |
- |
- |
(9) |
|
|
1 025 |
1 068 |
(182) |
132 |
843 |
1 200 |
|
Pre-tax share of operating results of joint ventures and associates |
||||||
|
Exploration and Production |
(1) |
- |
- |
- |
(1) |
- |
|
Liquefied Natural Gas |
54 |
45 |
- |
- |
54 |
45 |
|
Transmission and Distribution |
7 |
7 |
- |
- |
7 |
7 |
|
Power Generation |
23 |
19 |
- |
- |
23 |
19 |
|
|
83 |
71 |
- |
- |
83 |
71 |
|
Total operating profit/(loss) |
|
|
|
|
|
|
|
Exploration and Production |
579 |
677 |
(142) |
132 |
437 |
809 |
|
Liquefied Natural Gas |
358 |
456 |
43 |
- |
401 |
456 |
|
Transmission and Distribution |
116 |
(6) |
- |
- |
116 |
(6) |
|
Power Generation |
55 |
21 |
(83) |
- |
(28) |
21 |
|
Other activities |
- |
(9) |
- |
- |
- |
(9) |
|
|
1 108 |
1 139 |
(182) |
132 |
926 |
1 271 |
|
Net finance (costs)/income |
|
|
|
|
|
|
|
Finance income |
15 |
77 |
(38) |
30 |
(23) |
107 |
|
Finance costs |
(37) |
(37) |
31 |
(40) |
(6) |
(77) |
|
Share of joint ventures and associates |
(14) |
(19) |
- |
- |
(14) |
(19) |
|
|
(36) |
21 |
(7) |
(10) |
(43) |
11 |
|
Taxation |
|
|
|
|
|
|
|
Taxation |
(425) |
(460) |
62 |
(61) |
(363) |
(521) |
|
Share of joint ventures and associates |
(26) |
(12) |
- |
- |
(26) |
(12) |
|
|
(451) |
(472) |
62 |
(61) |
(389) |
(533) |
|
Profit/(loss) for the period |
621 |
688 |
(127) |
61 |
494 |
749 |
a) External sales are attributable to segments as follows: E&P £1 228 million (2008 £1 167 million), LNG £875 million (2008 £1 261 million), T&D £393 million (2008 £361 million) and Power £150 million (2008 £166 million). Intra-group sales are attributable to segments as follows: E&P £80 million (2008 £103 million) and LNG £12 million (2008 £29 million).
b) Business Performance Other operating income is attributable to segments as follows: E&P £11 million (2008 £19 million), LNG £44 million (2008 £15 million) and Power £1 million (2008 £nil).
|
|
Business Performance |
Disposals, re-measurements and impairments |
Total Result |
|||
|
Full Year |
2009 £m |
2008 £m |
2009 £m |
2008 £m |
2009 £m |
2008 £m |
|
Group revenue(a) |
|
|
|
|
|
|
|
Exploration and Production |
4 789 |
5 691 |
- |
- |
4 789 |
5 691 |
|
Liquefied Natural Gas |
3 796 |
5 386 |
- |
- |
3 796 |
5 386 |
|
Transmission and Distribution |
1 433 |
1 383 |
- |
- |
1 433 |
1 383 |
|
Power Generation |
512 |
617 |
- |
- |
512 |
617 |
|
Other activities |
- |
4 |
- |
- |
- |
4 |
|
Less: intra-group sales |
(317) |
(515) |
- |
- |
(317) |
(515) |
|
Group revenue |
10 213 |
12 566 |
- |
- |
10 213 |
12 566 |
|
Other operating income(b) |
150 |
36 |
105 |
157 |
255 |
193 |
|
Group revenue and other operating income |
10 363 |
12 602 |
105 |
157 |
10 468 |
12 759 |
|
Operating profit/(loss) before share of results from joint ventures and associates |
||||||
|
Exploration and Production |
2 087 |
3 512 |
(67) |
151 |
2 020 |
3 663 |
|
Liquefied Natural Gas |
1 340 |
1 445 |
43 |
- |
1 383 |
1 445 |
|
Transmission and Distribution |
399 |
132 |
(1) |
(2) |
398 |
130 |
|
Power Generation |
66 |
37 |
(83) |
- |
(17) |
37 |
|
Other activities |
(11) |
(20) |
- |
(16) |
(11) |
(36) |
|
|
3 881 |
5 106 |
(108) |
133 |
3 773 |
5 239 |
|
Pre-tax share of operating results of joint ventures and associates |
||||||
|
Liquefied Natural Gas |
211 |
140 |
- |
- |
211 |
140 |
|
Transmission and Distribution |
27 |
28 |
- |
- |
27 |
28 |
|
Power Generation |
92 |
81 |
- |
- |
92 |
81 |
|
|
330 |
249 |
- |
- |
330 |
249 |
|
Total operating profit/(loss) |
|
|
|
|
|
|
|
Exploration and Production |
2 087 |
3 512 |
(67) |
151 |
2 020 |
3 663 |
|
Liquefied Natural Gas |
1 551 |
1 585 |
43 |
- |
1 594 |
1 585 |
|
Transmission and Distribution |
426 |
160 |
(1) |
(2) |
425 |
158 |
|
Power Generation |
158 |
118 |
(83) |
- |
75 |
118 |
|
Other activities |
(11) |
(20) |
- |
(16) |
(11) |
(36) |
|
|
4 211 |
5 355 |
(108) |
133 |
4 103 |
5 488 |
|
Net finance (costs)/income |
|
|
|
|
|
|
|
Finance income |
63 |
227 |
4 |
49 |
67 |
276 |
|
Finance costs |
(160) |
(150) |
(22) |
(55) |
(182) |
(205) |
|
Share of joint ventures and associates |
(47) |
(52) |
- |
- |
(47) |
(52) |
|
|
(144) |
25 |
(18) |
(6) |
(162) |
19 |
|
Taxation |
|
|
|
|
|
|
|
Taxation |
(1 629) |
(2 248) |
31 |
(70) |
(1 598) |
(2 318) |
|
Share of joint ventures and associates |
(79) |
(39) |
- |
- |
(79) |
(39) |
|
|
(1 708) |
(2 287) |
31 |
(70) |
(1 677) |
(2 357) |
|
Profit/(loss) for the year |
2 359 |
3 093 |
(95) |
57 |
2 264 |
3 150 |
a) External sales are attributable to segments as follows: E&P £4 524 million (2008 £5 297 million), LNG £3 744 million (2008 £5 265 million), T&D £1 433 million (2008 £1 383 million), Power £512 million (2008 £617 million) and Other activities £nil (2008 £4 million). Intra-group sales are attributable to segments as follows: E&P £265 million (2008 £394 million) and LNG £52 million (2008 £121 million).
b) Business Performance Other operating income is attributable to segments as follows: E&P £22 million (2008 £(9) million), LNG £112 million (2008 £40 million) and Power £16 million (2008 £5 million).
|
Total Result |
Business Performance |
Disposals, re-measurements and impairments |
Total Result |
|||
|
Fourth Quarter |
2009 £m |
2008 £m |
2009 £m |
2008 £m |
2009 £m |
2008 £m |
|
Exploration and Production |
579 |
677 |
(142) |
132 |
437 |
809 |
|
Liquefied Natural Gas |
358 |
456 |
43 |
- |
401 |
456 |
|
Transmission and Distribution |
116 |
(6) |
- |
- |
116 |
(6) |
|
Power Generation |
55 |
21 |
(83) |
- |
(28) |
21 |
|
|
1 108 |
1 148 |
(182) |
132 |
926 |
1 280 |
|
Other activities |
- |
(9) |
- |
- |
- |
(9) |
|
|
1 108 |
1 139 |
(182) |
132 |
926 |
1 271 |
|
Less: Pre-tax share of operating results of joint ventures and associates |
|
|
|
|
(83) |
(71) |
|
Add: Share of post-tax results from joint ventures and associates |
|
|
|
|
43 |
40 |
|
Net finance (costs)/income |
|
|
|
|
(29) |
30 |
|
Profit before tax |
|
|
|
|
857 |
1 270 |
|
Taxation |
|
|
|
|
(363) |
(521) |
|
Profit for the period |
|
|
|
|
494 |
749 |
|
Total Result |
Business Performance |
Disposals, re-measurements and impairments |
Total Result |
|||
|
Full Year |
2009 £m |
2008 £m |
2009 £m |
2008 £m |
2009 £m |
2008 £m |
|
Exploration and Production |
2 087 |
3 512 |
(67) |
151 |
2 020 |
3 663 |
|
Liquefied Natural Gas |
1 551 |
1 585 |
43 |
- |
1 594 |
1 585 |
|
Transmission and Distribution |
426 |
160 |
(1) |
(2) |
425 |
158 |
|
Power Generation |
158 |
118 |
(83) |
- |
75 |
118 |
|
|
4 222 |
5 375 |
(108) |
149 |
4 114 |
5 524 |
|
Other activities |
(11) |
(20) |
- |
(16) |
(11) |
(36) |
|
|
4 211 |
5 355 |
(108) |
133 |
4 103 |
5 488 |
|
Less: Pre-tax share of operating results of joint ventures and associates |
|
|
|
|
(330) |
(249) |
|
Add: Share of post-tax results from joint ventures and associates |
|
|
|
|
204 |
158 |
|
Net finance (costs)/income |
|
|
|
|
(115) |
71 |
|
Profit before tax |
|
|
|
|
3 862 |
5 468 |
|
Taxation |
|
|
|
|
(1 598) |
(2 318) |
|
Profit for the year |
|
|
|
|
2 264 |
3 150 |
4. Net finance income
|
Fourth Quarter |
|
|
Full Year |
||
|
2009 £m |
2008 £m |
|
|
2009 £m |
2008 £m |
|
(26) |
(18) |
|
Interest payable |
(93) |
(84) |
|
(13) |
(16) |
|
Interest on obligations under finance leases |
(53) |
(57) |
|
11 |
5 |
|
Interest capitalised |
31 |
22 |
|
(9) |
(8) |
|
Unwinding of discount on provisions(a) |
(45) |
(31) |
|
31 |
(40) |
|
Disposals, re-measurements and impairments (Note 2) |
(22) |
(55) |
|
(6) |
(77) |
|
Finance costs |
(182) |
(205) |
|
15 |
77 |
|
Interest receivable |
63 |
227 |
|
(38) |
30 |
|
Disposals, re-measurements and impairments (Note 2) |
4 |
49 |
|
(23) |
107 |
|
Finance income |
67 |
276 |
|
(29) |
30 |
|
Net finance (costs)/income(b) |
(115) |
71 |
a) Relates to the unwinding of the discount on provisions and amounts in respect of pension obligations which represent the unwinding of discount on the plans' liabilities offset by the expected return on the plans' assets.
b) Excludes Group share of net finance costs from joint ventures and associates for the quarter of £14 million (2008 £19 million), and for the full year of £47 million (2008 £52 million).
5. Taxation
The taxation charge for the fourth quarter before disposals, re-measurements and impairments was £425 million (2008 £460 million) and the taxation charge including disposals, re-measurements and impairments was £363 million (2008 £521 million).
For the full year, the taxation charge before disposals, re-measurements and impairments was £1 629 million (2008 £2 248 million) and the taxation charge including disposals, re-measurements and impairments was £1 598 million (2008 £2 318 million).
The Group share of taxation from joint ventures and associates for the fourth quarter was £26 million (2008 £12 million) and for the full year was £79 million (2008 £39 million).
6. Earnings per ordinary share
|
Fourth Quarter |
|
|
Full Year |
||||||
|
2009 |
2008 |
|
|
2009 |
2008 |
||||
|
£m |
Pence per share |
£m |
Pence per share |
|
|
£m |
Pence per share |
£m |
Pence per share |
|
465 |
13.8 |
756 |
22.5 |
|
Earnings |
2 168 |
64.5 |
3 127 |
93.4 |
|
127 |
3.8 |
(61) |
(1.8) |
|
Disposals, re-measurements and impairments (after tax and minority interest) |
95 |
2.8 |
(59) |
(1.8) |
|
592 |
17.6 |
695 |
20.7 |
|
Earnings - excluding disposals, re-measurements and impairments |
2 263 |
67.3 |
3 068 |
91.6 |
Basic earnings per share calculations in 2009 are based on the weighted average number of shares in issue of 3 371 million for the quarter and 3 363 million for the full year.
The earnings figure used to calculate diluted earnings per ordinary share is the same as that used to calculate earnings per ordinary share given above, divided by 3 397 million for the quarter and 3 389 million for the full year, being the weighted average number of ordinary shares in issue during the period as adjusted for dilutive equity instruments.
7. Reconciliation of net borrowings/funds(a) - Full Year
|
|
£m |
|
Net borrowings as at 31 December 2008 |
(972) |
|
Net decrease in cash and cash equivalents |
(306) |
|
Cash inflow from changes in borrowings(b) |
(1 620) |
|
Inception of finance leases |
(62) |
|
Foreign exchange and other re-measurements |
4 |
|
Net borrowings as at 31 December 2009(a)(c) |
(2 956) |
Net borrowings attributable to Comgás were £513 million (31 December 2008 £443 million).
As at 31 December 2009, BG Group's share of the net borrowings in joint ventures and associates amounted to approximately £1.2 billion, including BG Group shareholder loans of approximately £0.9 billion. These net borrowings are included in BG Group's share of the net assets in joint ventures and associates which are consolidated in BG Group's accounts.
a) Net borrowings/funds are defined on page 28.
b) During 2009, BG Group issued a £500 million bond due in 2017, a Euro 750 million bond due in 2013 and a Hong Kong Dollar 370 million bond due in 2019, all under its Medium Term Note Programme. Also during the period, BG Group repaid a Singapore Dollar 100 million bond at maturity.
c) Net borrowings/funds comprise:
|
|
As at 31 Dec 2009 |
As at 31 Dec 2008 |
|
Amounts receivable/(due) within one year |
|
|
|
Cash and cash equivalents |
693 |
1 033 |
|
Overdrafts, loans and finance leases |
(717) |
(281) |
|
Derivative financial instruments(d) |
30 |
(49) |
|
|
6 |
703 |
|
Amounts receivable/(due) after more than one year |
|
|
|
Loans and finance leases |
(3 111) |
(1 897) |
|
Derivative financial instruments(d) |
149 |
222 |
|
|
(2 962) |
(1 675) |
|
Net borrowings |
(2 956) |
(972) |
d) These items are included within commodity contracts and other derivative financial instrument balances on the balance sheet.
Liquidity and Capital Resources
All the information below is as at 31 December 2009
The Group's principal borrowing entities are: BG Energy Holdings Limited (BGEH), including wholly owned subsidiary undertakings, the majority of whose borrowings are guaranteed by BG Energy Holdings Limited (collectively BGEH), and Comgás and Gujarat Gas which conduct their borrowing activities on a stand-alone basis.
BGEH had a US$2.0 billion US Commercial Paper Programme, of which US$1.277 billion was unutilised, and a US$2.0 billion Eurocommercial Paper Programme, of which US$1.925 billion was unutilised. BGEH also had a US$7.5 billion Euro Medium Term Note Programme, of which US$5.2 billion was unutilised.
BGEH had aggregate committed multicurrency revolving borrowing facilities of US$0.375 billion which expire in 2010, US$1.090 billion which expire in 2011 and US$1.040 billion which expire in 2012. There are no restrictions on the application of funds under these facilities, which were undrawn.
In addition, BGEH had uncommitted borrowing facilities including multicurrency lines, overdraft facilities of £45 million and credit facilities of US$20 million, all of which were unutilised.
Comgás had committed borrowing facilities of Brazilian Reais (BRL) 1 748.2 million, of which BRL 499.8 million was unutilised, and uncommitted borrowing facilities of BRL 494.7 million, of which BRL 140 million was unutilised.
8. Dividends
|
|
Full Year |
|||
|
|
2009 |
2008 |
||
|
|
£m |
Pence per share |
£m |
Pence per share |
|
Prior year final dividend, paid in the year |
220 |
6.55 |
193 |
5.76 |
|
Interim dividend, paid in the year |
189 |
5.62 |
156 |
4.68 |
|
Total dividend paid in the year |
409 |
12.17 |
349 |
10.44 |
|
|
|
|
|
|
|
Proposed final dividend for the year ended 31 December 2009 |
227 |
6.73 |
|
|
The proposed final dividend for the year ended 31 December 2009 of 6.73p takes the 2009 full year dividend to 12.35p.
The final dividend of 6.55p (£220 million) in respect of the year ended 31 December 2008 was paid on 22 May 2009 to shareholders (1 June 2009 to ADR holders) on the register at the close of business on 14 April 2009. The interim dividend of 5.62p (£189 million) was paid on 11 September 2009 (18 September 2009 to ADR holders). The proposed final dividend of 6.73p (£227 million) in respect of the year ended 31 December 2009 is payable on 21 May 2010 to shareholders (28 May 2010 to ADR holders) on the register at the close of business on 16 April 2010.
9. Capital investment: geographical analysis
|
Fourth Quarter |
|
|
Full Year |
||
|
2009 £m |
2008 £m |
|
|
2009 £m |
2008 £m |
|
204 |
290 |
|
Europe and Central Asia |
796 |
897 |
|
417 |
271 |
|
Americas and Global LNG |
2 119 |
775 |
|
229 |
414 |
|
Africa, Middle East and Asia |
1 355 |
1 304 |
|
243 |
2 142 |
|
Australia |
935 |
2 468 |
|
1 093 |
3 117 |
|
|
5 205 |
5 444 |
10. Quarterly information: earnings and earnings per share
|
|
2009 £m |
2008 £m |
2009 pence |
2008 pence |
|
First quarter |
|
|
|
|
|
Total Result |
706 |
767 |
21.0 |
22.9 |
|
Business Performance |
690 |
789 |
20.5 |
23.6 |
|
Second quarter |
|
|
|
|
|
Total Result |
513 |
747 |
15.3 |
22.3 |
|
Business Performance |
507 |
807 |
15.1 |
24.1 |
|
Third quarter |
|
|
|
|
|
Total Result |
484 |
857 |
14.4 |
25.6 |
|
Business Performance |
474 |
777 |
14.1 |
23.2 |
|
Fourth quarter |
|
|
|
|
|
Total Result |
465 |
756 |
13.8 |
22.5 |
|
Business Performance |
592 |
695 |
17.6 |
20.7 |
|
Full year |
|
|
|
|
|
Total Result |
2 168 |
3 127 |
64.5 |
93.4 |
|
Business Performance |
2 263 |
3 068 |
67.3 |
91.6 |
Supplementary information: Operating and financial data
|
Fourth Quarter |
Third Quarter |
|
|
Full Year |
||
|
2009 |
2008 |
2009 |
|
|
2009 |
2008 |
|
|
|
|
|
Production volumes (mmboe) |
|
|
|
8.6 |
8.0 |
6.1 |
|
- oil |
30.8 |
30.6 |
|
9.2 |
8.7 |
8.5 |
|
- liquids |
35.7 |
35.3 |
|
44.1 |
40.6 |
42.0 |
|
- gas |
168.4 |
160.8 |
|
61.9 |
57.3 |
56.6 |
|
- total |
234.9 |
226.7 |
|
|
|
|
|
Production volumes (boed in thousands) |
|
|
|
93 |
87 |
66 |
|
- oil |
84 |
84 |
|
100 |
95 |
92 |
|
- liquids |
98 |
96 |
|
480 |
441 |
457 |
|
- gas |
462 |
439 |
|
673 |
623 |
615 |
|
- total |
644 |
619 |
|
|
|
|
|
|
|
|
|
£45.87 |
£33.05 |
£41.54 |
|
Average realised oil price per barrel |
£39.29 |
£50.40 |
|
($74.83) |
($55.18) |
($68.31) |
|
($60.94) |
($95.43) |
|
|
|
|
|
|
|
|
|
|
£36.69 |
£17.83 |
£34.94 |
|
Average realised liquids price per barrel |
£31.73 |
£38.96 |
|
($59.85) |
($29.76) |
($57.45) |
|
($49.22) |
($73.76) |
|
|
37.00p |
60.79p |
30.78p |
|
Average realised UK gas price per produced therm |
43.07p |
42.69p |
|
16.51p |
25.10p |
16.01p |
|
Average realised International gas price per produced therm |
18.10p |
22.23p |
|
19.80p |
32.52p |
17.90p |
|
Average realised gas price per produced therm |
22.20p |
26.28p |
|
|
|
|
|
|
|
|
|
£2.38 |
£2.21 |
£2.66 |
|
Lifting costs per boe |
£2.38 |
£1.94 |
|
($3.90) |
($3.69) |
($4.37) |
|
($3.69) |
($3.67) |
|
|
|
|
|
|
|
|
|
|
£3.93 |
£3.93 |
£4.04 |
|
Operating expenditure per boe |
£3.85 |
£3.38 |
|
($6.40) |
($6.55) |
($6.65) |
|
($5.97) |
($6.40) |
|
|
|
|
|
|
|
|
|
|
454 |
697 |
707 |
|
Development expenditure (including acquisitions)(£m) |
2 194 |
1 957 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross exploration expenditure (£m) |
|
|
|
194 |
2 134 |
468 |
|
- capitalised expenditure (including acquisitions) |
1 651 |
2 695 |
|
74 |
50 |
51 |
|
- other expenditure |
251 |
206 |
|
268 |
2 184 |
519 |
|
- gross expenditure |
1 902 |
2 901 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Exploration expenditure charge (£m) |
|
|
|
98 |
95 |
70 |
|
- capitalised expenditure written off |
349 |
245 |
|
74 |
50 |
51 |
|
- other expenditure |
251 |
206 |
|
172 |
145 |
121 |
|
- exploration charge |
600 |
451 |
|
|
|
|
|
|
|
|
|
|
|
|
|
LNG cargoes |
|
|
|
14 |
12 |
22 |
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- delivered to US |
71 |
55 |
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44 |
37 |
31 |
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- delivered to global markets |
151 |
172 |
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58 |
49 |
53 |
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- total |
222 |
227 |
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190.1 |
125.4 |
161.2 |
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LNG managed volumes (Tbtu) |
695.9 |
674.7 |
BG Group's exposure to the oil price varies according to a number of factors including the mix of production and sales. Management estimates that, other factors being constant and assuming a constant relationship between commodity prices, a US$1.00 rise (or fall) in the Brent price would increase (or decrease) E&P business operating profit in 2010 by approximately $90 million to $110 million.
As from 2010, BG Group will be reporting its annual results in US Dollars. Management estimates that in 2010, other factors being constant, a 10 cent strengthening (or weakening) in the US Dollar would increase (or decrease) operating profit by approximately $10 million to $30 million.
Additional information: Exploration and Production - Reserves/Resource data
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As at 31 Dec 2009 mmboe |
As at 31 Dec 2008 mmboe |
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Proved(a) |
2 600 |
2 459 |
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Probable |
3 530 |
3 383 |
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Discovered resources |
4 931 |
3 722 |
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Risked exploration |
3 433 |
3 562 |
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Total reserve/resource base |
14 494 |
13 126 |
Total additions and revisions to proved reserves during the year were 376 mmboe. This includes revisions due to new data and improved reservoir performance (342 mmboe increase), developments and sales (140 mmboe increase), acquisitions and disposals (97 mmboe increase) and the net effect of price movements (203 mmboe decrease).
Total Proved Reserve Replacement Ratio (RRR):
The three/one year average proved reserve replacement ratio is the total net proved reserves changes over the three/one year period including purchases and sales excluding production divided by the total net production for that period.
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For information: |
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3 year |
1 year |
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SEC data(a) |
166% |
160% |
Organic Proved Reserve Replacement Ratio (RRR):
The three/one year average proved reserve replacement ratio is the total net proved reserves changes over the three/one year period excluding purchases, sales and production divided by the total net production for that period.
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For information: |
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3 year |
1 year |
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SEC data(a) |
132% |
119% |
Finding & Development Cost (F&D):
The three/one year average unit finding and development cost is calculated by dividing the total exploration, development and unproved acquisition costs incurred over the period by the total changes in net proved reserves excluding purchases, sales and production for that period.
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For information: |
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3 year |
1 year |
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SEC data(a) |
$19.8/boe |
$20.3/boe |
(a) SEC definitions have been applied to measure proved reserves. One year averages are calculated using a 12 month average price in line with the revised SEC methodology effective for the year ended 31 December 2009. Three year averages include calculations based on year end prices for 2008 and 2007.
Glossary
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In BG Group's results some or all of the following definitions are used: |
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bcf |
billion cubic feet |
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bcfd |
billion cubic feet per day |
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boe |
barrels of oil equivalent |
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boed |
barrels of oil equivalent per day |
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bopd |
barrels of oil per day |
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CAGR |
compound annual growth rate |
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Capital investment |
Comprises expenditure on property, plant and equipment, other intangible assets and investments, including business combinations |
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E&P |
Exploration and Production |
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EBITDA |
earnings before interest, tax, depreciation and amortisation |
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FEED |
Front-End Engineering Design |
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FPSO |
Floating Production Storage and Offloading system |
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Gearing ratio |
net borrowings as a percentage of total shareholders' funds (excluding the re-measurement of commodity financial instruments and associated deferred tax) plus net borrowings |
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GW |
gigawatt |
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IAS 39 |
International Accounting Standard 39 (Financial Instruments) |
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IFRS |
International Financial Reporting Standards |
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kboed |
thousand barrels of oil equivalent per day |
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LNG |
Liquefied Natural Gas |
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Managed volumes |
Comprises all LNG volumes contracted for purchase and having related revenue and other operating income recognised in the applicable period |
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m |
million |
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mmboe |
million barrels of oil equivalent |
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mmbtu |
million british thermal units |
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mmcfd |
million cubic feet per day |
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mmcmd |
million cubic metres per day |
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mmscfd |
million standard cubic feet per day |
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mmscm |
million standard cubic metres |
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mmscmd |
million standard cubic metres per day |
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mtpa |
million tonnes per annum |
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MW |
megawatt |
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Net borrowings/ funds |
Comprise cash, current asset investments, finance leases, currency and interest rate derivative financial instruments and short- and long-term borrowings |
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PSC |
production sharing contract |
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SEC |
US Securities and Exchange Commission |
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T&D |
Transmission and Distribution |
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Tbtu |
trillion british thermal units |
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Total operating profit |
Group operating profit plus share of pre-tax operating results of joint ventures and associates |
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UKCS |
United Kingdom Continental Shelf |
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Unit operating expenditure per boe |
Production costs and royalties incurred over the period divided by the net production for the period. Production costs and royalties (other operating costs) for the period are disclosed under 'results of operations' in the Supplementary information - Oil and Gas disclosures in BG Group's Annual Report & Accounts for the period. This measure does not include the impact of depreciation and amortisation costs and exploration costs as they are not considered to be costs associated with the operation of producing assets. |
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Unit lifting costs per boe |
'Unit operating expenditure' as defined above, excluding royalty, tariff and insurance costs incurred over the period divided by the net production for the period. |
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Enquiries |
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Enquiries relating to BG Group's results, business and financial position should be made to: |
General enquiries about shareholder matters should be made to: |
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Investor Relations Department BG Group plc Thames Valley Park Drive Reading Berkshire RG6 1PT |
Equiniti Limited Aspect House Spencer Road Lancing West Sussex BN99 6DA |
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Tel: 0118 929 3025 e-mail: [email protected] |
Tel: 0871 384 2064 e-mail: [email protected] |
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Media Enquiries: Edel McCaffrey: 0118 929 3508 Jo Thethi: 0118 929 3110 |
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High resolution images are available at www.vismedia.co.uk |
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BG Group is listed on the US over-the-counter market known as the International OTCQX. Enquiries should be made to: |
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Pink OTC Markets Inc. 304 Hudson Street 2nd Floor New York, NY 10013 USA |
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e-mail: [email protected] |
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Financial Calendar |
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Ex-dividend for 2009 final dividend |
14 April 2010 |
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Record date for 2009 final dividend |
16 April 2010 |
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Announcement of 2010 first quarter results |
29 April 2010 |
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Payment of 2009 final dividend |
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Shareholders |
21 May 2010 |
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American depositary receipt holders |
28 May 2010 |
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BG Group plc website: www.bg-group.com |
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Registered office 100 Thames Valley Park Drive, Reading RG6 1PT Registered in England No. 3690065 |
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Related Shares:
BG..L