Noreco announces first quarter 2015 results and completion of financial restructuring
Stavanger, 31 May 2015: Norwegian Energy Company ASA (“Noreco” or the “Company”) today announces its first quarter 2015 financial results and provides the following updates.
Please note that the first quarter financial results are highly impacted by accounting effects due to the recent financial restructuring.
Operating result before depreciation and write-downs (EBITDA) was negative NOK 154 million, reflecting lower production and NOK 107 million exploration and evaluation expenses related to the Xana well.
Net profit after tax was however positive NOK 1 794 million. This was mainly due to one-off financial effects of NOK 2 176 million related to the referred restructuring. NOK 543 million of this effect is related to the IFRS requirement to value the bond loans at market value, i.e. executed trades at the end of the first quarter. At that time volumes were extremely thin and large bondholders were restricted from trading. This accounting effect is expected to be reversed towards maturity of the bonds.
The recorded equity is highly impacted by the same requirement. If the bond loans were recorded to the principal amount at the end of the first quarter, the equity would have been NOK 468 million lower than the NOK 1 276 million actually reported according to IFRS accounting principles.
Further to the financial restructuring that has now been concluded, the Company under the leadership of a renewed board of directors is focusing all its efforts on implementing a cohesive revised strategic direction.
Tommy Sundt, Chief Executive Officer of Noreco says “We are pleased that Noreco has addressed its financial issues. The strong support shown by our key stakeholders ensures that we can now progress and enhance the value of our portfolio of assets. In light of the current challenging environment for oil and gas companies and the significant future debt servicing requirements, our main focus in the short term will be to limit future investment commitments, continue implementing cost saving measures and unlock value for all our stakeholders through either continued operations or through divestment efforts.”
Earnings call and further information
Noreco management will be presenting the Q1 report in an earnings call tomorrow, Monday 1 June, at 08:30 CET. Please use tel. 800 88 860 from Norway or +47 23 18 45 00 from abroad, and conference code 826932# to participate and call in a few minutes prior to the start of the meeting to allow registration of participants.
For further information, please see attached Q1 report. The presentation material for the earnings call will be published early morning on 1 June.
In accordance with loan agreements, a separate financial report for Noreco Norway AS is available on the Company’s web.
Odd Arne Slettebø, CFO. Tel.: +47 992 83 900
About Norwegian Energy Company ASA
Noreco is an independent Norwegian oil company. The company's focus is to explore, develop and produce oil and gas in the North Sea region. Noreco was incorporated in 2005 and operates in Norway, Denmark and United Kingdom. The company’s stock is listed on the Oslo Børs (ticker NOR). For further information, please visit: www.noreco.com.