State-owned Abu Dhabi National Energy Co swung to a third-quarter loss on Wednesday hurt by increased costs and lower natural gas prices, which offset a rise in revenue.
TAQA, which is 75 per cent owned by the Abu Dhabi government, reported a third-quarter net loss of Dhs288 million ($78.4 million), compared with a profit of Dhs537 million a year ago, it said in a statement.
Results were impacted by construction costs of Dhs2.73 billion which the company booked for the Jorf Lasfar power plant in Morocco.
“Our financial performance over the last quarter has been impacted by a series of one-off items – both cash and non-cash, which have suppressed our net result,” TAQA’s Chief Financial Officer Stephen Kersley said.
Revenue rose 43 per cent to Dhs8.83 billion dirhams during the quarter from Dhs6.2 billion a year ago. TAQA’s oil and gas revenues fell to Dhs2.56 billion from Dhs2.74 billion a year ago, while fuel revenue decreased to Dhs952 million from Dhs1.15 billion in the prior year period.
TAQA, which has hired banks to issue a bond, said its North American portfolio of assets has been impacted by a 40 per cent slump in natural gas prices. The company will either sell non-core acreage or increase production in core areas going forward to weather the downturn, it said in the statement.
TAQA also runs power plants in Morocco, Saudi Arabia, Ghana and India. It also plans to start oil and gas operations in Northern Africa.
On Monday, TAQA mandated five banks for a dollar-denominated bond which could be issued before the year end, a spokesman for the company told Reuters
TAQA last tapped global debt markets in December last year with a $1.5 billion two-tranche bond to refinance debt.
The company has a $1 billion bond coming due in August and a $750 million note maturing in October, according to Thomson Reuters data.
Separately, sources told Reuters on Monday that TAQA is in advanced talks to buy a stake in an oil block in Iraqi Kurdistan by taking a majority interest in General Exploration Partners (GEP).
TAQA shares are up 9.2 per cent year-to-date. They were yet to trade on Abu Dhabi bourse Wednesday.