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Magnolia Petroleum Annual Loss Narrowed Despite Revenue Fall

LONDON (Alliance News) - Magnolia Petroleum PLC on Monday reported a narrowed pretax loss for ...

Alliance News 19 June, 2017 | 11:24AM
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LONDON (Alliance News) - Magnolia Petroleum PLC on Monday reported a narrowed pretax loss for 2016, despite a fall in revenue due to a drop in drilling activity.

Pretax loss narrowed to USD1.4 million from USD9.7 million the year before, due to the lack of an impairment of intangible assets, which came to GBP5.0 million in 2015, and a reduced impairment in property, plant and equipment of GBP2.2 million compared to GBP3.5 million in 2015.

Revenue however, dropped to GBP1.3 million from GBP2.0 million the prior year, as a result of a lowered oil price, leading to lower sales prices and operators shutting down wells to reduce production.

To help deal with the revenue fall, Magnolia reduced its operating costs by 33% in the year, further to the 31% cut made the year before.

"Magnolia has emerged from the two year downturn in oil and gas markets with a lower cost base; a strengthened balance sheet, following the partial repayment of our reserves based lending facility; and strong asset backing in the form of our proven developed reserves. Furthermore, we have taken advantage of depressed markets to increase our leasehold position in low cost plays, such as the South Central Oklahoma Oil Province and the Sooner Trend Anadarko Basin Canadian and Kingfisher Counties in Oklahoma where excellent production and recovery rates are being consistently reported for new wells, including those in which Magnolia has an interest," said Chief Executive Officer Rita Whittington.

Shares in Magnolia Petroleum were untraded on Monday. They last traded at 0.11 pence.

By Dayo Laniyan; dayolaniyan@alliancenews.com

Copyright 2017 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article
Security Name Price Change (%) Morningstar
Rating
Magnolia Petroleum PLC 5.00 GBX 0.00 -
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