Medco books $10.1m in net profit

IDX-listed PT Medco Energi Internasional announced on Monday a profit attributable to main entity holders (net profit) of US$10.1 million last year, down by $2.5 million from $12.6 million in the previous year.

Aside form an decrease in oil and gas production, the oil price drop has dealt a blow to the firm?s financial performance, but the firm managed to alleviate the impacts by implementing efficiency measures.

Oil and gas production fell to 56,000 barrels of oil equivalent per day (boepd) last year, compared to 62,000 boepd in the previous year; while realized price averaged $97.83 per barrel, down by 9.6 percent from the previous year.

Despite the production and oil price decline, the firm managed to increase its sales by $40 million last year as it was able to renegotiate the price of its gas to $5.6 per mmbtu, higher by 9.2 percent from the previous year.

Gross profit and operating profit reached $271 million and $161 million last year, while EBITDA reached $259 million, down from $351 million in the previous year.

Thanks to efficiency measures, the firm managed to cut marketing, general and administrative expenses by 5.8 percent to $110 million, while headquarter costs dropped by 25 percent. Meanwhile, financing costs were cut to $71 million from $71 million.

Last year, the firm managed to hold the reserve depletion rate of its old wells at around 7 percent, lower than the global average depletion rate of 20-25 percent.

In 2014, the firm managed to increase its portfolio assets by acquiring four exploration blocks in Papua New Guinea and eight blocks in Tunisia and one block, Block 56, in Oman. The acquisition of the new blocks in Tunisia has increased the firm?s production and P2 reserve by 2,800 boepd and 11 mmboe. The Tunisian assets will increase production up to 16,000 bopd in 2019.

Editing by Johannes Simbolon