TAQA registers good financial results in Q1 2012 (final add)
TAQA registers good financial results in Q1 2012 (final add)2012-05-10 19:42:00
WAM Abu Dhabi, May 10th, 2012 (WAM)–xxxx. Applied. Finance costs increased from AED 1.1 billion in Q1 2011 to AED 1.3 billion in Q1 2012, largely due to the addition of the project financing related to the completion of Fujairah 2 and Shuweihat 2.
Profit Before Tax was AED 1.4 billion in Q1 2012, 46 per cent higher year-on-year than AED 961 million in Q1 2011, due to higher revenues as a result of the higher oil price, stronger production in the UK North Sea, the increased power revenues due to Shuweihat 2 and Fujairah 2, and the gain on the disposal of North American non-core assets.
TAQA’s income tax expense was AED 724 million in 2012 compared to AED 650 million, an effective tax rate of 52 per cent in Q1 2012, compared with 68 per cent in Q1 2011.
Net Profit After Minority Interests increased by 251 per cent year-on-year, to AED 534 million for Q1 2012, versus AED 152 million for Q1 2011.
TAQA’s Net Debt/Capital ratio was 78 per cent at the end of the period and Net Debt/EBITDA improved to 5.0 times.
Year on year total debt has remained stable at AED 74.0 billion whilst overall Net Debt decreased by AED 1.3 billion in part due to the cash proceeds received from the disposal of non-core Canadian acreage.
Consolidated cash on hand as at 31 March 2012 was AED 5.2 billion, compared with AED 4.4 billion at the end of Q1 2011. TAQA had unused credit lines of AED 14.7 billion at the end of Q1 2012, compared to AED 7.3 billion at the end of Q1 2011, and total available liquidity of AED 19.9 billion compared to AED 11.7 billion for Q1 2011.
On 26 February 2012, MYR 650 million (USD 215 million) was issued under the MYR 3.5 Billion (USD 1.1 billion) Sukuk programme TAQA had established in November 2011. The 10 year Sukuk was raised with a profit rate of 4.65 per cent with a full swapped rate to US Dollars of 5.3%.
TAQA’s Power ‘&’ Water business performance continues to generate steady, stable cash flows, with a top-quartile performance for technical availability.
TAQA produced 14,172 GWh of electricity and 54,114 MIG of water during Q1 2012, generating total revenues of AED 1.9 billion. The 13 per cent increase in revenues compared to the same period last year, reflects the contribution from Shuweihat 2 which was fully operational in October 2011. Global technical availability was 91.3% for Q1 2012.
TAQA’s domestic portfolio of assets generated 9,075 GWh of electricity and 54,114 MIG of water during Q1 2012, reflecting the additional capacity of Shuweihat 2, which was completed in October 2011, adding 1,500 MW of power generation and 100 MIGD of water desalination capacity. Domestic availability was 90.8 per cent.
TAQA’s international power portfolio, which comprises of assets in Morocco, Ghana, India, Saudi Arabia and the United States, generated 5,097 GWh of power during the year. International technical availability was 93.4 per cent, higher than the same period last year.
In Morocco, construction is proceeding at Units 5 and 6 of the Jorf Lasfar plant within budget and on schedule. Commissioning and takeover of Units 5 and 6 is planned for the end of 2013 and early 2014, respectively.
TAQA’s Oil ‘&’ Gas business comprises strong, well-resourced centres of excellence supporting a portfolio of assets with viable growth potential across North America, the UK North Sea and the Netherlands.
Total Oil ‘&’ Gas revenues, including gas storage and other operating revenues, were AED 2.9 billion for Q1 2012, flat compared to Q1 2011. This was driven primarily by the increase in realised crude oil prices in the UK and Dutch North Sea, offset by lower North American gas prices. Total average global daily production for Q1 2012 decreased to 134.2 mboe/day, compared to 138.8 mboe/day in Q1 2011.
Production in North America decreased slightly year-on-year at 86.3 mboe/day, reflecting the divestment of approximately 4.0 mboe/day that closed in early March. TAQA sold non-core acreage in North America for a total of AED 1,717 million, resulting in a gain of AED 378 million, which is recognised in the consolidated income statement.
Production in the UK North Sea averaged 41.0 mboe/day during the quarter, 3 per cent lower than the first quarter of 2011 due to the overrun of a planned shutdown at Cormorant Alpha, as well as some technical issues at North Cormorant and Pelican that affected production. These issues have now been resolved and production has returned to budgeted levels.
In February 2012, TAQA announced two farm-in agreements with a subsidiary of Fairfield Energy Limited for oil and gas licences in the UK North Sea. The agreements will result in TAQA, acquiring a 50 per cent interest in licences P184, P474 and P1634, which include the Darwin oil discovery and prospective exploration acreage south of Darwin. The licences are located next to the TAQA operated North Cormorant and Pelican fields in the Northern North Sea.
Also in February, TAQA acquired a further 50 per cent interest in the Otter field, to add to the 31 per cent already held. Otter is tied back to TAQA’s Eider platform.
Production in the Netherlands averaged 6.9 mboe/day, a 24 per cent decrease compared to the same period last year due natural declines.
During the quarter, TAQA commenced its onshore exploration campaign with the first of four proposed targets drilled near Alkmaar, the Netherlands.
During the quarter, the oil price continued to have a favourable impact on TAQA’s financial results, although this was offset by weaker North American gas prices.
The WTI oil price averaged US$104.03 in the first quarter of 2012, compared with US$94.60 for the same period in 2011. Prices for Brent crude increased to an average US$118.45 for the first quarter, up from US$105.52 for the same period last year.
NYMEX gas prices for Q1 2012 averaged US$2.50, compared with US$4.20 for Q1 2011.
On 8 April 2012, TAQA signed a joint venture agreement with Mass Global Investments Company Limited, Under the agreement, TAQA will acquire a 50 per cent interest in the 1,000 MW gas fired IPP situated near Sulaymaniyah, in the Kurdish region of the Republic of Iraq. The power plant has been operating from 2009 and has a capacity of 750 MW with additional 250 MW under construction. The transaction is subject to the fulfillment of certain conditions.
On 8 April 2012, TAQA successfully completed the sale of all its holding in Tesla Motors for a total consideration of AED 956 million (USD 260 million) realizing a gain of AED 415 million.
On 2 May 2012 the Dutch Council of State delivered its judgment upholding the central government’s land-use plan for the Bergermeer Gas Storage facility. The Council of State ruling is not appealable and the project will now go ahead.