LONDON (Alliance News) - BG Group PLC on Friday reported a decline in earnings during the third quarter of 2015 that was in line with expectations, and the company raised its full-year production guidance after reporting a large rise in production during the period.
The oil and gas producer operating in over 20 countries, and the subject of a takeover offer by Royal Dutch Shell PLC, reported earnings before interest, tax, depreciation and amortisation of USD1.24 billion in the third quarter of 2015, down from USD1.98 billion a year earlier but ahead of the analyst consensus which estimated Ebitda of USD1.15 billion.
Earnings before interest and tax came in at USD384.0 million in the quarter, significantly down from USD1.28 billion a year ago but in line with the USD389.0 million estimated by analysts.
Revenue for the quarter fell as expected to USD4.14 billion from USD4.58 billion leading to its pretax profit of USD466.0 million compared to a USD1.98 billion profit.
Importantly, the company upgraded its full-year production guidance to between 680,000 and 700,000 barrels of oil equivalent per day after third quarter production rose 26% year-on-year to 716,000 barrels of oil equivalent per day.
As expected, BG Group reaffirmed its commitment to completing it GBP47.0 billion mega-merger with Royal Dutch Shell in early 2016.
Shell released its third quarter results on Thursday, which showed the oil major had made a major USD6.10 billion current cost of supply loss from a USD5.30 billion profit a year earlier due to major write down and impairments after pulling out of numerous projects.
Overall, Shell's earnings missed analyst expectations by around a third, and in the first nine months of 2015 Shell has seen its earnings fall by 87%, or GBP13.00 billion.
On Wednesday Nomura analyst Alwyn Thomas said his Buy recommendation for BG Group was predicated on his belief that the Shell deal will be completed and therefore BG shares represent a cheaper way to access Shell.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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