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(Alliance News) - Diversified Energy Co PLC on Thursday said its pretax loss widened to USD344.0 million in the first half of 2020, from USD59.2 million the year before.
The natural gas-focused energy producer based in Alabama noted that higher gas, gas liquids and oil prices prompted adverse mark-to-market valuation changes on its long-dated contracts.
Revenue surged 75% to USD323.3 million from USD184.9 million year-on-year. Revenue for all of 2020 was USD408.7 million.
Hedged adjusted earnings before interest, tax, depreciation and amortisation - which excludes mark-to-market valuation changes - was USD151.3 million, a 3.4% rise from USD146.3 million in the same period last year.
Diversified Energy tipped it now has an improved pricing outlook for natural gas materials and looks to hedge investments "at levels that support higher cash operating margins."
"Disciplined hedging strategy protects cash flows and provides dividend and debt repayment stability," the FTSE 250 firm added.
It declared an interim dividend of 4.0 US cents per share, climbing from 3.75 US cents a year before.
The energy producer's assets are largely located in the United States' Appalachian Basin region, but have recently extended inwards to the central region of Louisiana, Texas, Oklahoma and Arkansas.
"Our entry into a new operating region complements our continued focus in Appalachia and introduces a geographic diversity capable of providing improved margins from higher realised pricing and a significant new runway for further value accretive and synergistic opportunities," said Chief Executive Rusty Hutson.
"With a business model centred on an asset profile rather than a defined geologic region, we are confident in our ability to replicate our Appalachian success in the central region by delivering the same operating efficiencies and cost controls that result in strong margins and consistent shareholder returns."
Shares in Diversified Energy were down 1.6% at 103.92 pence in London in Thursday morning trading.
By Josie O'Brien; josieobrien@alliancenews.com
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