LONDON (Alliance News) - Regal Petroleum PLC reported a decline in pretax profit for the first half, as lower volumes and prices of gas and oil took its toll.
The oil and gas exploration and production group posted pretax profit of USD4.4 million for the period ended 30 June, down from USD10.4 million a year earlier, while revenue dipped to GBP19.7 million, from USD22.0 million in 2012.
The combination of lower volumes and lower average prices led to the decline, the company said.
Cost of sales for the six month period was USD11.4 million, up from USD9.0 million. This increase was due to a combination of the new single subsoil tax, which came into effect in January, and higher depreciation charges of USD5.5 million, compared with USD4.5 million due to the revised reserves base introduced in December 2012.
Realised average gas and condensate prices in Ukraine was USD419/Mm3 and USD91/per barrel, respectively, during the period, compared with USD422/Mm3 and USD104/per barrel, respectively, in 2012.
Looking ahead, Regal said it was concerned that a gas supply agreement between Russia and Ukraine could have an effect on Ukrainian gas prices.
Although a decision has yet to be reached on any adjustment, Regal has taken this possibility into consideration in its internal projections and budgets, it said.
Capital investment for the period was USD13.0 million, up from USD11.1 million in 2012, which principally reflects the current drilling programme in Ukraine.
Regal shares were trading at 15.0 pence Tuesday, down 1.62 pence or 9.8%.
By Anthony Tshibangu; anthonytshibangu@alliancenews.com; @AnthonyAllNews
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