SOCO sees revenues surge during 'transformational' year

FTSE 250-listed oil and gas group SOCO International more than doubled revenues and profits in 2012 after a 'transformational' year which saw the firm bring on additional production ahead of schedule at its Te Giac Trang (TGT) field in Vietnam.

Revenues reached a record $621.6m in the 12 months to December 31st, up 166% on the previous record of £234.1m registered in 2011.

The top line was helped by the company's first full year of production from the TGT field H1-WHP and around six months of output from the H4-WHP. The on-budget delivery of the second TGT platform was one month ahead of schedule and nearly a whole year ahead of the original development plan, SOCO said.

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Average gross total field production from TGT is now above 50,000 barrels of oil equivalent per day (BOEPD).

Meanwhile, the company, which also has interests in the Republic of Congo, the Democratic Republic of Congo and Angola, said that group net entitlement volumes were around 15,500 BOEPD in 2012, compared with an average of 6,730 BOEPD in 2011.

Higher oil prices also did their bit to help, rising from $113 to $118 a barrel over the period.

Profit before tax totalled $445.6m in 2012, up from $158.6m previously, while basic earnings per share surged from 26.4 cents to 62.7 cents.

Cash flows from operating activities surged from $90.2m to $334.8m last year, reflecting the increases in both production and prices. Meanwhile, capital expenditure dropped from $152.2m to $109.9m.

SOCO said that it is not paying a dividend for 2012 but expects to recommend a "sustainable return of capital to shareholders during 2013".

Ed Story, SOCO's President and Chief Executive Officer, said: "The financial and operating results for 2012 demonstrate the transformation of this company. With the TGT field's average gross production now over 50,000 BOEPD, the record revenues, cash flow and profitability speak for themselves.

"Moreover, higher rates of production over continued sustained periods support our earlier views of the size of this major oilfield. Further, as we look forward into 2013, SOCO is now poised to take advantage of more substantial future growth opportunities."