News

July 13, 2009

Melrose Resources Update Says Operating Performance Is In Line With Expectations Ahead Of The Interim Results Report In August

When we reported on the full year results announcement for 2008 from London listed Melrose Resources last March, we said there were few surprises, and in the current climate who wants surprises. Instead the investors got another solid set of headline figures plus a 33 per cent increase in the total dividend. The Edinburgh- headquartered and FTSE 250 company saw turnover rise 136 per cent to US$373.3 million while after tax profits of US$68.3 million more than reversed the US$ 63.2 million loss posted in 2007. Production was up 23 per cent at 18,506 barrels of oil equivalent per day on a net entitlement basis and the company more than replaced the barrels produced, with a reserves replacement ratio of 290 per cent.

Perhaps most importantly, given the tight lending conditions, the company signed a new and relatively low cost US$510 million loan facility in June 2008 which will run until 2014 with no capital repayments before 2012.  Small wonder, we said, when relating all this chairman Robert Adair described 2008 as an “excellent year” for the company in which it generated record production, revenue and profit.

What we might have also said is that Melrose seems to have developed a knack for accurate...