Genel Energy swings to losses as revenues improve

The London-listed firm said its EBITDAX - earnings before intangible asset impairment, tax, depreciation, amortisation and exploration credits - was $304.1m for the year ended 31 December, down from $475.5m in 2017.

It swung to an operating loss of $254.6m for the year, from an operating profit of $298m a year earlier, while its cash flow from operating activities rose to $299.2m from $221m.

Capital expenditure during the year totalled $95.5m, up from $94.1m, and free cash flow improved to $164.2m from $99.1m.

Cash at year-end was $334.3m, which was higher than the $162m reported at the end of 2017, while total debt remained in line with the prior year at $300m.

Basic losses per share were 101.6 US cents, swinging from earnings of 97.1 cents per share 12 months earlier, while underlying earnings per share rose to 109 cents per share from 65.1 cents.

“Genel's strategy at the start of 2018 was clear - generate material free cash flow from producing assets, build and invest in a rich funnel of transformational development opportunities, and return capital to shareholders at the appropriate time,” said chief executive officer Murat Özgül.

“We are delivering on this strategy.”

Özgül said 2018 was another year of material free cash flow generation, as the company continued to transform its balance sheet, adding that the addition of assets with the potential of Sarta and Qara Dagh led to a “very successful delivery” on the first two parts of the strategy.

“We will continue to develop opportunities and invest in growth.

“As we do so, a robust cash flow outlook and our confidence in Genel's future prospects underpins our initiation of a material and sustainable dividend policy.”