Sound Oil's losses widen after write down

25th May 2011 15:23

Italy- and Indonesia-focused oil and gas group Sound Oil has hailed its most successful year since formation despite significantly widening its losses in the 12 months ended 31 December..Pre-tax losses surged to £16.0m, from just £2.6m previously, driven by a £14.2m loss on the disposal of its farmout interest in the Bangkanai asset, Indonesia.Before the write down, operating losses were slightly worse at £2.0m, down from £1.9m in 2010. The group has no operating revenues.Loss per share grew to 2.31p, from 0.38p. No dividend was paid."This year has been the most successful since the company was formed...I believe Sound has plenty of exciting activity coming up in the next year or so. Altogether we expect around seven wells to be drilled and we shall also be investigating other ways of giving shareholders greater value," said chairman Gerald Orbell.The acquisition of 98% of Consul Oil & Gas in early 2011 gave Sound participating interests in 16 new licences, mostly as operator.Since the year-end, the group has made a several fundraising transactions (such as issuing 311m new shares at 1.2p to raise £3.7m in January) and now has around £13m in cash and no debt."This provides it with sufficient capital to fund three wells and one well completion in Italy over the next 12-18 months, in addition to the five exploration wells already planned in Indonesia during H2 2011, marking the most active period in Sound's history," said finnCap analyst Will Amstein.---BC