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Seplat to pay interim dividend in spite of profit decline

By on November 1, 2014

Seplat Petroleum Development Company Plc Thursday announced an interim dividend of $0.06 per share for the nine months ended September 30, 2014 despite a decline in its profit for the period.

The company reported nine months gross revenue of $592.5 million (N92 billion), compared with $642.9 million (N99.9 billion)) in the corresponding period of 2013.

Profit after tax fell by 48 per cent from $442.2 million in 2013 to $227.9 million (N35.4 billion) in 2014.

Notwithstanding the decline in bottom-line, the directors recommended an interim dividend of $0.06 per share.  According to the company, the dividend will be paid on or shortly after 24 November 2014 to shareholders on the register at the close of business on November 6, 2014.

The company explained that the decrease year-on-year due to deferred tax liabilities of $92.7 million (N14.4 billion) released in Q3 2013 as a result of pioneer status being granted to the group, lower crude revenue in 2014 as well as $54 million (N8.4 billion) of one-off general and administration costs in relation to financing, regulatory, procurement and staff costs in 2014.

Assessing the results, analysts at Renaissance Capital, said the performance showed show good operational progress.

“Seplat’s operations for  nine months  came in broadly in line with our expectations, with production at 29 kb/d (working interest), compared with earlier guidance of 29-33 kb/d for the full year, as a result of an accelerated drilling campaign to make up for lost time in  first half of 2014.More importantly, gross production reached 70 kb/d on  October 2, which makes achieving the year-end target of 72.5 kb/d now even more realistic, in our view,” they  said.

They added that Seplat planned to maintain organic growth, noting, “the gas-lift programme, Sapele shallow and general exploration and appraisal are the three sources of future production growth. “The Oben gas plant (150mmcf/d capacity) has arrived in Nigeria, with site preparation works completed. Other infrastructure projects, including storage and liquids treatment facilities, also seem to us to be broadly on track.”

 

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