LONDON (Alliance News) - Magnolia Petroleum PLC Monday said its revenue, production and well count continues to grow at double-digit rates, but it still swung to a half-year pretax loss because of a rise in operating costs and losses incurred from foreign exchange.
The company swung to a pretax loss of USD381,520 in the first six months of 2014, compared to a USD644,574 profit in the comparable period in 2013. Operating costs doubling to USD838,863 from USD410,147, while Magnolia also incurred a loss on foreign exchange of USD491,219, compared to a USD669,999 profit in the 2013 half.
Magnolia's revenue almost doubled to USD1.8 million in the recent half from USD910,721 a year before.
Production increased to 257 barrels of oil equivalent per day as at June 30, compared to 150 barrels of oil equivalent per day as at April 1.
"During the period, initial production rates were reported for 15 new wells in proven US onshore formations in which Magnolia has an interest," said Chief Operations Officer Rita Whittington in a statement. "In addition we elected to participate in 39 new wells, bringing the total number we currently have under development to 74."
Added Chief Executive Steven Snead: "Magnolia's well count, production, and revenues continue to grow at double-digit rates...This is the fifth consecutive half-year period we have reported double digit revenue growth and importantly we expect to extend this run going forward thanks to a long pipeline of future production and revenue growth."
"We already have a pipeline of 74 wells under development and continue to receive multiple proposals to participate in new drilling activity on our leases in proven US onshore formations, and as a result we expect to report further excellent growth going forward," Snead said.
Magnolia's proven developed resources stood at USD9.1 million at June 30, compared to USD8.4 million as at April 1.
"We are successfully building an extensive portfolio of proven reserves in liquids-rich US onshore formations such as the prolific Bakken and Three Forks Sanish, North Dakota and the Woodford and Mississippi Lime, Oklahoma," Snead said.
"With our revenues maintaining their upwards trajectory and a new and improved USD6 million credit facility secured post period end, Magnolia is well placed to fund the drilling activity required to prove up what we believe are substantially higher recoverable resources/ reserves on our acreage...Magnolia is in a stronger than ever position to monetise its leases," the chief executive said in a statement.
Magnolia's shares were up 7.6% to 1.48 pence per share Monday morning.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
Copyright 2014 Alliance News Limited. All Rights Reserved.
