Sterling Energy posts fall in first quarter profits

Sterling Energy reported a fall in first quarter profits Friday reflecting a drop in revenues from oil lifted from the Chinguetti field in Mauritania, lower prices and higher operating costs.

Sterling Energy reported a fall in first quarter profits Friday reflecting a drop in revenues from oil lifted from the Chinguetti field in Mauritania, lower prices and higher operating costs.

Profit after tax in the first three months of the year came to $0.1m, down from $3.1m a year earlier.

Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) fell to $2.4m from $4.9m.

The company said profits took a hit from a rise in depletion costs as a result of higher production during the period. Production, net to sterling from the Chinguetti field, averaged 568 barrels of oil per day (bopd), compared to 401 bopd the previous year.

Results were also affected by a lower oil inventory valuation and a reduction in the reporting currency value working capital deposits held in pounds sterling following a weakening of the US dollar exchange rate.

Cash balances at the end of the quarter were $117.0m, including $1.4m of partner funds, down from the prior year's cash balance of $120.3m, including $1.7m partner funds.

"The company has large working interests in high materiality exploration and is well placed to build the portfolio using existing resources," said Chief Executive, Angus MacAskill.

"Progress continues to be made towards the drilling of exploration wells in our blocks in Cameroon and Madagascar, and we remain focused on acquiring only those ventures we believe will deliver real growth and value for our shareholders."

Shares fell 3.07% to 35.50p at 15:52 Friday.

RD

Recommended

How to profit from India’s high-tech recovery
Share tips

How to profit from India’s high-tech recovery

Professional investor David Cornell of the India Capital Growth Fund, selects three of his favourite Indian stocks to buy now.
27 Sep 2021
Share tips of the week – 24 September
Share tips

Share tips of the week – 24 September

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
24 Sep 2021
Three strong Asian stocks trading at bargain prices
Share tips

Three strong Asian stocks trading at bargain prices

Professional investor Nitin Bajaj of the Fidelity Asian Values investment trust picks three stocks that dominate their industries, earn good returns o…
20 Sep 2021
Why it pays to face up to your investment mistakes
Investment strategy

Why it pays to face up to your investment mistakes

Buying stocks can be a complicated business. But selling stocks can be tricky, too – even if you sell for the right reasons. Max King explains how to …
17 Sep 2021

Most Popular

A nightmare 1970s scenario for investors is edging closer
Investment strategy

A nightmare 1970s scenario for investors is edging closer

Inflation need not be a worry unless it is driven by labour market shortages. Unfortunately, writes macroeconomist Philip Pilkington, that’s exactly w…
17 Sep 2021
Two shipping funds to buy for steady income
Investment trusts

Two shipping funds to buy for steady income

Returns from owning ships are volatile, but these two investment trusts are trying to make the sector less risky.
7 Sep 2021
What really causes inflation? Here’s what prices since 1970 tell us
Inflation

What really causes inflation? Here’s what prices since 1970 tell us

As UK inflation hits 3.2%, Dominic Frisby compares the cost of living 50 years ago with that of today, and explains how debt drives prices higher.
15 Sep 2021