Genel Energy keeps interim dividend, books hefty impairment charges

The Kurdistan, Iraq-focused oil explorer also forecast that it would end the year with a net cash position, assuming oil prices held at their current level, which it credited to its low-cost production and the capital flexibility of its development programme.

For the six months ending on 30 June, the firm posted a

14.2% drop in oil production to 32,100 barrels of oil equivalent per day.

That resulted in a 54.5% drop in revenues to $88.4m and a 61.1% reduction in earnings before interest, taxes, depreciation and amortisation to $65.1m.

The company also booked non-cash impairment charges of -$286.3m and $34.9m against the value of its oil and gas assets, and trade receivables, respectively.

In underlying terms meanwhile, group profit sank from $91.9m for the year earlier period to -$32.2m, resulting in a loss per share of -11.7 cents against earnings of 27.2 cents a year back.

Total debt however was unchanged at $300m with net cash edging higher, from $55.8m to $57.2m (after payment of the dividend in June), even as its free cash flow dwindled from $56.7m to $6.5m.

In parallel, the average price of Brent during the period came in at $40 a barrel, down from $65.

The interim dividend was kept at five cents per share.

"The dividend remains a core part of our business model, which is focused on growth and the protection of financial strength."

As of 1219 BST, shares of Genel Energy were down 4.95% to 146.0p.