2008 Financial Results Summary


 

TIDMROC 
 
RNS Number : 9850N 
Roc Oil Company Limited 
27 February 2009 
 

 
 
 
 
 
 
27 February 2009 
 
 
 
 
ROC OIL COMPANY LIMITED ("ROC") 
 
 
STOCK EXCHANGE RELEASE 
 
 
 
 
2008 FINANCIAL RESULTS SUMMARY 
 
 
 
 
ROC has released its Preliminary Final Report (Appendix 4E), Directors' Report 
and Annual Financial Report for the Financial Year ended 31 December 2008. The 
key highlights are: 
 
 
FINANCIALS 
 
 
  *  Sales revenue of US$358.2 million (2007: US$208.5 million); up 72% on the 
  previous year. 
 
 
 
  *  Average sales price of US$92.06/BBL (before hedging); a 5.3% discount to the 
  Brent oil average price of US$97.26/BBL. 
 
 
 
  *  Net cash flow from operations of US$182.5 million (2007: US$138.1 million); up 
  32%. 
 
 
 
  *  Trading profit of US$163.8 million (2007: US$104.7 million); up 56%. 
 
 
 
  *  EBITDAX (and impairments) of US$312.3 million (2007: $US112.3 million); up 178%. 
 
 
 
  *  Net loss after income tax of US$278.4 million (2007: loss of US$84.4 million) 
  including: 
-              non-cash asset impairments of US$376.9 million; 
-              exploration expensed of US$112.7 million; and 
-              hedging gain of US$38.6 million. 
 
 
 
  *  Normalised net loss after income tax US$66.5 million (2007: loss of US$28.0 
  million) after adjusting for significant items. 
 
 
 
  *  Amortisation expense of US$120.4 million (2007: US$81.4 million); up 48%. 
 
 
 
  *  Year end debt of US$168.7 million (2007: US$133.3 million), partially offset by 
  cash of US$54.3 million (2007: US$41.4 million). 
 
 
 
  *  Funding in 2009 largely underpinned by existing cash flow, existing bank loan 
  facilities and new loan facilities established subsequent to year end. 
 
 
 
OPERATIONS 
 
 
  *  Production of 4.0 MMBOE from seven producing fields in Australia, Africa, China 
  and UK compared to 3.5 MMBOE produced from six fields in 2007; up 14%. 
 
 
 
  *  Exploration and appraisal expenditure of US$115.2 million (2007: US$94.7 
  million) relating to: 
 
 
 
          -eight exploration wells (one discovery at Coco-1, onshore Angola); 
          -six appraisal wells; 
          -three 3D seismic surveys; and 
          -one aeromagnetic survey. 
 
 
  *  Development expenditure of US$76.2 million (2007: US$57.4 million) relating to: 
 
 
 
-    Construction, fabrication and installation of new facilities, as well as 
development drilling activities at Zhao Dong Block, Bohai Bay, offshore China; 
and 
-    Ongoing expansion activity at Basker-Manta-Gummy Oil and Gas Fields, 
offshore Victoria. 
 
 
Commenting on the 2008 Financial Results, ROC's Chief Executive Officer, Mr 
Bruce Clement, stated: 
 
 
"ROC's 2008 Financial Results are dominated by non-cash balance sheet asset 
impairments that largely resulted from the fall in oil price during the year. 
The oil price fell 62% year-on-year and by 64% since the acquisition of Anzon in 
September. Asset revaluations have resulted in write-downs and impairments of 
US$376.9 million (before tax), which was a major contributor to the reported 
loss of US$278.4 million (after tax). 
 
 
However, underlying these results is a healthy business, with a sound 
operational and cash flow base, substantial 2P Reserves (24 MMBOE) and 
development potential from Contingent Resources (23.9 MMBOE). The Anzon 
acquisition contributed 7.7 MMBOE of 2P Reserves and 18.7 MMBOE of Contingent 
Resources. The 2008 cash flow from operations was US$182.5 million from 
production of 4.0 MMBOE. Current production exceeds 12,000 BOEPD and average 
operating cost is approximately US$15/BBL. Even in today's US$40/BBL oil price 
environment, ROC continues to generate positive operating cash flow. 
 
 
Importantly, the funding for ROC's 2009 business plans is largely underpinned by 
operating cash flow and support from existing lenders. In particular, a new 
US$35 million bridge facility has been provided by CBA to support development 
activities in 2009 and the term of the existing US$30 million working capital 
facility from CBA has been extended to 30 June 2010. 
 
 
In this uncertain global financial environment and with oil prices at four year 
lows, ROC's business strategy is to steward financial resources and to continue 
focusing on production and development operations. ROC has taken positive action 
to ensure the business operates effectively in this environment. Exploration 
expenditure for 2009 has been minimised, development programmes have been 
structured to focus on delivering optimal financial returns and opportunities 
are already being pursued to enhance production performance and to take 
advantage of cost reductions now being experienced in the industry. 
 
 
ROC is well positioned to take advantage of improvements in oil price, whenever 
this may occur, through strong production and development opportunities within 
its existing asset base." 
 
 
For further information please contact: 
Mr Bruce Clement 
Chief Executive Officer 
Tel: +61-2-8023-2000 
Fax: +61-2-8023-2222 
Email: bclement@rocoil.com.au 
Or visit ROC's website: www.rocoil.com.au 
 
 
Michael Shaw 
Oriel Securities Limited (Nominated Adviser) 
Tel: +44 (0)20 7710 7600 
 
 
Bobby Morse 
Buchanan Communications 
Tel: + 44 (0)20 7466 5000 
Fax: + 44 (0)20 7466 5001 
E-Mail: bobbym@buchanan.uk.com 
Mob: +44 (0)7802 875 227 
 
 
 
 
 
 
In accordance with ASX and AIM Rules, the reserves and resources information in 
this Release has been reviewed and approved by Mr Neil Seage, Chief Reservoir 
Engineer, Roc Oil Company Limited, BA, BEng (Hons), MBA and Dip App Fin. Mr 
Seage, who is a member of the Society of Petroleum Engineers, has more than 30 
years of relevant experience within the industry and consents to the information 
in the form and context in which it appears. 
 
 
 
 
 
 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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