President Energy (AIM: PPC), the upstream oil and gas company with a diverse portfolio of production and exploration assets focused primarily in Argentina, provides highlights from the unaudited Group management report for the full year 2018, a comparison with the previous year and a review of current trading.
Financial Highlights
- 160% increase in year on year turnover to US$47.2m (2017 – US$17.9m)
- 2018 Adjusted EBITDA* in excess of US$16m (2017 – loss of US$1.4m)
- Operational profit of $14.3m after administration expenses and workovers, but before depreciation (2017 – loss of US$4.3m)
- 498% increase in group free cash generation from core operations before G&A to US$21.5m against 2017 (2017 – US$3.6m)
- Group well operating costs per barrel decreased 16% to US$29.50 versus 2017 (2017 – US$35.05)
Trading and outlook
The Group is pleased to report that its internal unaudited management accounts for the year 2018 show a dramatic improvement from those the previous year. All key performance indicators demonstrated significant progress over the previous year. The key highlights of the results are shown above.
The results reinforce the fact that, as with the individual quarters figures last year, the Company has not been materially adversely affected by the recent macroeconomic turbulence in Argentina, which has stabilised with the Argentine own Stock Exchange up some 17% this year alone together with material recovery in bond prices and a much more stable forex rate.
The current year has begun well. Net Group production of 3,300 boepd is being sustained. January production from our core Rio Negro assets show an improvement of some 70% from the same month in 2018.
A minimum programme of six well workovers of currently shut in producing wells together with additional reactivations is due to commence at the end of March targeted to give another step up for production levels whilst smoothing any field natural declines. The year will also see President pivot towards more gas production as well as increasing its oil sales.
In the second half of the year a drilling programme of both oil and gas wells will commence, firm details of which will be announced in due course. President, by that time, will not only be selling gas through its own pan-regional pipeline network and powering it’s own fields but will also be selling electricity to the national grid. Each one of these branches being a not insubstantial profit centre/cost saving in their own right.
Peter Levine, Chairman and Chief Executive commented:
“The unaudited management results for 2018 show significant progress was achieved across all areas of the business.
We have established an impressive production platform in Argentina and have the potential to materially increase production near term through continued development drilling and exploration with our successful and highly motivated management team.
With our established footprint within South America as well as our position as an established and reputable operator of all our assets; we continue to actively look at new opportunities with the intent of exponentially growing our business.”
*Adjusted EBITDA is Earnings before interest, tax, depreciation, amortisation and impairment and adjusted to exclude non-recurring items
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