Dana Gas, the biggest publicly traded energy company in the UAE, reported a 27 per cent year-on-year rise in first-quarter net profit amid an increase in Kurdish region output and higher hydrocarbon prices.
Net income rose to Dh51 million in the first three months to the end of March, the company said in a statement to Abu Dhabi Securities Exchange, where its shares are traded. Revenue for the period rose to Dh271m from Dh267m, reported at the end of the first quarter of 2017, it said.
“The first quarter of 2018 saw Dana Gas continue to perform solidly from both a financial and operational perspective,” said Patrick Allman-Ward, chief executive of Dana Gas.
“We have delivered a good set of financial numbers for the first quarter ... we continue to collect payments regularly in the KRI [Kurdistan Region of Iraq] and our cash reserves increased further to $636m.”
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The company said the increase in revenue was due to the higher price for condensate which added Dh45m to the top line and helped offset a decrease in production in Egypt and the UAE, which impacted revenues by Dh37m.
In the Kurdish region, the Pearl Petroleum consortium, is on track to increase production by 20 per cent this year and 170 per cent by 2021, the company said.
Dana will contribute Dh257m towards capital expenditure as part of its 35 per cent shareholding in the consortium. The share of Dana’s capital expenditure will be covered from the Dh1.46 billion development fund, operating cash flow or third party financing, it said.
Dana Gas on Sunday said that it reached an agreement with a committee of creditors holding its Islamic bonds to restructure and refinance its $700m sukuk, which when finalised will end a protracted legal dispute that sent shockwaves through the Islamic finance industry.
The ad hoc committee of sukuk holders has entered into a binding agreement, which offers them two refinancing options. The transaction is expected to be completed by the first half of July, the company said in a bourse filing.
Dana Gas has been embroiled in a legal battle over the legality of its sukuk since last year when it surprised creditors including investment bank Goldman Sachs and Blackrock, the world’s biggest asset manager, by declaring its bonds non-Sharia complaint, citing changes in Islamic finance.
The agreement is contingent on various conditions being satisfied, including payment of costs of certain parties and termination of all current litigation, which has been value-eroding to all stakeholders, as well as a release of certain claims.
