Seplat released its 2014 Half Year results last week reporting a 50% drop in earnings per share. Whilst this sharp drop may just have been a blip, it’s quite remarkable how the CEO explained it out in the company’s News Release. Here is an excerpt
“Seplat performed well during the first half of 2014. Although production in the period was impacted by the shutdown of third party infrastructure, we continue to drive growth – excluding the shut-in days, our gross daily average production from OMLs 4, 38 and 41 was over 60,000 barrels. We plan to have up to seven drilling rigs actively engaged, and are progressing plans at a fast pace to develop our oil and gas reserves and increase production, aiming to build momentum through the second half and into 2015.
The completion of our new pipeline to the Warri refinery provides us with an alternative export option and reduces our exposure to any future downtime of the Trans Forcados system, as well as the reconciliation losses imposed on producers using that system.
In our gas business, the signing of a 15 year gas supply agreement to supply the Azura-Edo IPP is further evidence of our commitment to remain at the forefront of assisting Nigeria to realise its vast natural gas potential.
Seplat is in a strong financial position. Our profitable production base and conservative capital structure give us the necessary financial resources and flexibility to actively pursue a range of attractive, material new business opportunities.” Austin Avuru (Seplat CEO)
For a company that just reported a sharp drop in earnings per share, one would expect a better explanation don’t you think?
You can download their earnings presentation here