Genel Energy Lifts Revenue Forecast to $330 million
LONDON -- The shares of Genel Energy jumped 2.6% to 800 pence during London trade today after the company said its full-year revenue would be higher than expected.
Genel, which claims to be the largest independent oil-producer in the Kurdistan region of Iraq, said sales for 2012 were expected to be around $330 million. The company said the figure included $132 million received from the Kurdistan authorities relating to unpaid historic export shipments.
In November, Genel predicted 2012 revenue would be between $250 million and $300 million. Genel today confirmed that its production last year had been in line with earlier guidance at 44,500 barrels of oil a day. The firm also said capital expenditure came to $230 million last year and was forecast to be between $400 million and $500 million during 2013.
Genel's exploration program for this year includes three "high impact wells" within Kurdistan, which the company believes may reveal 750 million barrels of oil. Tony Hayward, Genel's chief executive, said this morning: "2012 saw a strong production performance and a materially expanded exploration portfolio that will provide us with significant opportunities in 2013, both in the Kurdistan Region of Iraq and Africa. We expect revenues to be ahead of previous guidance and all development and exploration activities in Kurdistan to be funded from cash flow generated locally in line with our stated strategy."
Genel's share price has seen its ups and downs, with the price falling from 10 pounds to below 6 pounds and bouncing back toward 8 pounds during the last two years. Half-year results last year showed profit of $22 million, which, when compared to Genel's 1.7 billion pound market cap, indicates a lot of current value is placed on the group's $1 billion cash hoard and oil presumed to be in the ground.
Of course, whether today's statement, that market cap, and the prospects for oil exploration within Kurdistan now combine to make Genel a "buy" remains your decision. In fact, if Genel is already in your portfolio, you may wish to click here and read the Fool's exclusive oil and gas report to help you determine whether you should take any further action. The free report explains the factors you need to consider -- and the risks you might encounter -- when evaluating oil and gas explorers.
The article Genel Energy Lifts Revenue Forecast to $330 million originally appeared on Fool.com.
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