(Alliance News) - Diversified Gas & Oil PLC on Monday lifted its interim dividend, expressing confidence in its cashflow and medium-term outlook.
The owner and operator of producing gas and oil assets in the Appalachian Basin in the US swung to a pretax loss in the half year to June 20 of USD59.2 million from a profit of USD84.1 million a year prior. Revenue fell to USD184.9 million from USD237.5 million.
Despite this, the company recorded an increase in net production in the half to 17.3 million barrels of oil equivalent, up from 13.7 million barrels a year prior. Average production per day was 95,148 barrels, up from 75,696. Exit rate net production in June was 109,000 barrels of oil equivalent per day.
Adjusted earnings before interest, tax, depreciation and amortisation was up 11% to USD146 million from USD131 million the year before.
Following the rise in production and Ebitda, Diversified announced a 7.1% increase in its dividend for the second quarter to 3.75 US cents per share from 3.50 cents a year prior. This brings the total for the first half to 7.25 cents.
Chief Executive Rusty Hutson said: "While others have been forced to cut or suspend their dividends over the past several months, the strength and durability of our cash flows allow us to not just sustain but to increase our second quarter dividend by 7% to 3.75 US cents per share, wholly reflective of the confidence the board has in the near-medium-term outlook for the business.
"Despite the current market backdrop, we are well-positioned to step into the second half of 2020 and continue to do what we do best - engage in operational activities that minimise cost and maximise production; create value through opportunistic hedging practices and value-adding financing arrangements," the company said.
Diversified Oil & Gas shares were up 2.1% at 101.60 pence each on Monday morning in London.
By Greg Roxburgh; gregroxburgh@alliancenews.com
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