Tullow Oil plc (LON:TLW), the independent oil and gas exploration and production group, announced today its Half Year results for the six months ended 30 June 2019. Details of a presentation in London, webcast and conference calls are available on the last page of this announcement or visit the Group’s website www.tullowoil.com.
COMMENTING TODAY, PAUL McDADE, CHIEF EXECUTIVE OFFICER, SAID:
“Today’s results demonstrate strong financial delivery in the first half of 2019 with robust profits and free cash flow. We are disappointed that a mechanical issue at our latest TEN well has caused us to reduce our 2019 production outlook; however, our overall portfolio of low-cost West African production continues to provide a solid financial base for the business, allowing the Group to invest for future growth, continue to reduce debt and pay dividends to shareholders. Elsewhere, our exciting three-well Guyana exploration campaign is now under way and I am particularly pleased to see the good progress being made in Kenya with the first ever lifting of East Africa crude expected in the coming months.”
2019 HALF YEAR RESULTS SUMMARY
· Revenue of $872 million; gross profit of $527 million; post tax profit of $103 million; free cash flow of $181 million
· Board confirms interim dividend of 2.35 cents/share (c. $33 million) in line with the Group’s Capital Returns Policy
· Net debt and gearing reduced to $2.9 billion and 1.8x; no near-term debt maturities
· First half 2019 capex of $248 million; 2019 capex forecast remains unchanged at $570 million
· West Africa first half 2019 working interest oil production averaged 88,700 bopd1
· Full year 2019 oil production guidance revised down to 89-93,000 bopd reflecting delays in TEN well completion
· Kenya oil development progressing well; Heads of Terms signed with the Government; FID targeted for second half of 2020
· Uganda farm-down continues to make limited progress; discussions between JV Partners and Government continue
· Three-well Guyana exploration campaign under way; Jethro result expected in first half of August
· New exploration acreage accessed in Argentina, Peru and Namibia; withdrawn from Zambia and Mauritania C-18 licence
FINANCIAL OVERVIEW
| 1H 2019 | 1H 2018 | |
| Sales revenue ($m)2 | 872 | 905 |
| Gross profit ($m) | 527 | 521 |
| Profit after tax ($m) | 103 | 55 |
| Free cash flow ($m)3 | 181 | 390 |
| Gearing (times) 3 | 1.8 | 2.0 |
| Net debt ($m) 3 | 2,948 | 3,082 |
1 Includes 2,700 bopd of production-equivalent insurance payments
2 Revenue does not include proceeds for Tullow’s Corporate Business Interruption insurance of $29 million (1H 2018: $129 million)
3Free cash flow, gearing and net debt are non-IFRS measures and are explained in the finance review
Corporate Governance matters
Board changes
Tutu Agyare retired from Tullow after nine years on the Board following the Group’s Annual General Meeting (AGM) on
25 April 2019. Sheila Khama and Genevieve Sangudi joined Tullow’s Board as Non-Executive Directors on 26 April 2019.
Dividend
The Board has approved an interim dividend of 2.35 cents/share (c.$33 million) which will be paid on 4 October 2019. This is in line with the Group’s Capital Returns Policy of intending to pay shareholders at least $100 million per year. The Record Date will be 30 August 2019 and the relevant exchange rate used to determine the payment of dividends will be announced on
18 September 2019.
Investor Relations contacts
Following these Results, Chris Perry, VP of IR & Communications, will be taking up another senior role in Tullow as Corporate Head of Value and Risk, after leading Tullow’s Investor Relations & Communications team for the past 10 years. Going forward, Tullow’s primary Investor Relations contacts will be Julia Ross, Corporate Head of Strategy & Performance, and Nicola Rogers, Head of Investor Relations. Please get in touch with the team directly or use [email protected] for queries.
