LONDON (Alliance News) - Exillon Energy PLC Friday said its pretax profit halved in the first half of 2015 after lower oil prices, lower margins and lower production all hit revenue.
The company also said it has purchased an aircraft to improve time-management of the company's directors and management.
The oil producer, based in Russia, reported a USD15.5 million pretax profit in the first six months of 2015, only half the USD30.0 million profit made a year earlier as revenue dropped to USD108.7 million from USD148.2 million.
Although revenue dipped, its gross profit only experienced a minor fall to USD44.3 million from USD48.2 million with a significant rise in selling expenses to USD20.3 million from USD3.4 million being one of the main reason profit halved.
Earnings before interest, tax, depreciation and amortisation fell 40% to USD30.4 million from USD50.7 million, bringing Ebitda per barrel of oil down 35% to USD10.2 per barrel from USD15.6.
Revenue was hit by lower oil prices, a lower Ebitda margin and lower production.
Production was 7% down year-on-year to an average of 16,643 barrels of oil per day in the first half. That brought total production to 3.0 million barrels in the period, down from 3.2 million barrels a year ago.
Production fell as a result of the company waiting for wells on the Exillon TP field to be fracked and waiting for workovers because of seasonal accessibility of oil wells.
Its other main field, Exillon WS, production also fell because of the increased level of watercut in nine oil wells located close to oil-water boundary, waiting for fracturing treatment for newly completed oil wells and waiting for workovers because of seasonal accessibility of oil wells.
Currently, 79% of its production comes from the WS field with the remainder coming from the TP field, and the company currently gets a better Ebitda margin from the WS field than it does from TP.
Capital expenditure totalled USD29.1 million in the half, up from USD17.6 million a year ago, mainly invested in the WS field and corporate activities, it said. Included in that is a USD10.6 million purchase of an aircraft which was subsequently leased to an unrelated third party for a period of ten years at a monthly lease payment of USD130,000.
Exillon reserves the right to use that aircraft on commercial payment terms and it said the purchase was to improve the efficiency of time-management of the company's directors and management.
Exillon shares were up 2.2% to 104.0 pence per share on Friday.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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