UAE’s Dana Gas reports Dhs183m net profit in Q1 2023

Dana Gas has announced its financial results for the first quarter ended March 31, 2023.

For the first quarter of 2023, the company generated a net profit of Dhs183m ($50m) as compared to Dhs198m ($54m) in Q1 2022, reported state news agency WAM.

Profitability for the quarter dropped 7 per cent compared to a 22 per cent decrease in the company’s realised prices during the period.

The impact of lower realised prices on the company’s profitability was partially offset by a production increase in the KRI and reduced operating costs by 14 per cent.

Revenue was 13 per cent lower at Dhs447m ($122m) in Q1 2023 compared to Dhs513m ($140m) in 2022. The decrease in revenue, and subsequently net profit, was primarily due to a pullback in energy prices from high levels.

The company’s realised prices during the period averaged $59/bbl for condensate and $39/boe for LPG compared to $82/bbl and $43/boe respectively in Q1 2022.

Dana Gas’ shareholders in April approved the board’s recommendation for a final dividend payment of 4.5 fils per share for H2 2022.

The payout of 4.5 fils per share for the second half of 2022, to be distributed on the May 25, will take the total dividend payment for 2022 to Dhs630m or 9 fils per share, a 12.5 per cent increase compared to the dividend for 2021.

Dr Patrick Allman-Ward, CEO of Dana Gas, commented: “Dana Gas has delivered a strong set of financial and operating results despite the downturn in energy prices.

We remain financially disciplined and focused on maintaining production and lowering costs, despite the challenging economic situation in the KRI and Egypt.

Our target date for completion of the KM250 gas expansion project is April 2024, and we are hopeful our Egypt consolidation agreement will be finalised soon. Looking ahead we are focusing our efforts on managing capital expenditure and preserving liquidity, as we continue to focus on recovering our outstanding receivable payments with both the KRG and Egyptian Government”.

Liquidity

The company’s cash position as of March 31 stood at Dhs542m ($148m), including Dhs374m ($102m) held at the Pearl Petroleum joint venture.

To bolster its liquidity, the company entered into a short-term loan facility of $65m with a local UAE bank during the first quarter. The facility was fully drawn in April 2023.

The group collected a total of Dhs231m ($63m) during the first quarter, with Egypt and the KRI contributing Dhs55m ($15m) and Dhs176m ($48m) respectively.

The company’s receivables in KRI stands at Dhs293m ($80m) and in Egypt at Dhs128m ($35m) at the end of the quarter.

Read: Dana Gas reports 53% rise in adjusted net profit for 2022