BG Group posts fall in fourth quarter earnings

Natural gas company BG Group on Tuesday posted a 29 per cent fall in fourth quarter earnings as the FTSE 100 company experienced a decline in cargo deliveries.

Earnings for the last three months of 2012 came to $1.0bn, down from $1.4bn the previous year, primarily as a result of $277 million tax credit in 2011.

The results were in line with a 12% drop to $1.8bn in total operating profit for the period. The group's earnings per share came to $0.30, a 29% decline from the year before, while dividend per share rose 10% to $0.14.

BG Group's Chief Executive Officer, Chris Finlayson, said the quarter reflected fewer liquefied natural gas (LNG) cargo deliveries and lower spot prices which resulted in a "16% lower contribution from LNG Shipping & Marketing".

However, full-year earnings still climbed 3% to 4.3bn, boosted by a 4% rise in total operating profit. Earnings per share for the year also increased 3% to $1.29 and dividend per share jumped 10% to $2.61.

Finlayson, said the company made important progress on projects across the world, particularly in Brazil and in Australia. Last month a record 55 wells were drilled.

"We continued to deliver excellent performance in exploration and appraisal, with 18 successful wells out of 19 tests in the year, including a further four successes in Tanzania," he said.

"Elsewhere, our risked exploration resources grew by more than 20% with new licences acquired in Uruguay, Egypt, India and Trinidad and Tobago."

He said the group signed agreements which are expected to release $8.1bn of capital by the end of this year, exceeding targets 12 months ago. This year the group is focusing on exploration and production and natural gas as it reviews its long-term strategy, he added.

"We have much to accomplish and clear milestones to deliver in 2013. We have seven projects coming onstream over the year. Our focus is squarely on safety and execution in both our growth projects and base assets.

"In Egypt, BG Group continues to keep the business environment under careful review. We have sanctioned the next phase of development for the West Delta Deep field, subject to partner approval, which will come onstream in 2014.

"...Our strategy will build on our distinctive strengths, which clearly differentiate us from the majors in the industry: world class exploration, a unique LNG model and our commercial agility."

RD