Cooper Energy Limited (ASX: COE) released its FY19 results this morning and reported a statutory net loss after tax of $12.1 million. Here’s what you need to know.
What Did Cooper Energy Report?
Statutory net profit at Cooper Energy fell $39.1 million from a net profit of $27 million in the 2018 financial year (FY18) to a net loss of $12.1 million in FY19. However, on an underlying basis, net profit after tax (NPAT) was actually up 36% to $13.3 million on the back of a 28% increase in gas sales revenue.
The reason for the discrepancy in the statutory and underlying profit figures largely comes from a $26.2 million non-cash restoration expense that is not considered part of the ongoing operations of the business.
Importantly, Cooper has managed to secure a number of new gas contracts in recent months including agreements with ASX heavyweights Origin Energy Limited (ASX: ORG) and AGL Energy Limited (ASX: AGL).
Sole Gas Field
Towards the end of the financial year, the company completed construction of its flagship Sole Gas Project safely and within budget. The Sole gas field, an offshore development, is now ready to commence production upon the completion of the upgrade to APA’s Orbost gas plant. Cooper Energy is anticipating a substantial increase in gas production in FY20 as a result.
Management Comments & Outlook
Upon the release of the results, Managing Director David Maxwell said that the FY19 results highlighted the value of the company’s growing gas business.
Maxwell was pleased with the growth in gas sales saying, “we are reporting higher revenue, notwithstanding lower production, due to our gas sales, which rose 28% year-on-year.”
“The improved financial results for the second half align with commencement of new gas contracts on 1 January 2019. This process is ongoing, with the new contracts negotiated in 2019 expected to benefit the FY20 financial result.”
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At the time of publishing, Luke has no financial interest in any companies mentioned.
