Sterling Energy posts fall in first quarter profits

19th Apr 2013 15:20

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