73
Year ended 31 December
($ thousands)
2012
2013
Fair value loss on convertible loans ..............................................
(4,528)
(12,071)
Other income ................................................................................
223
599
Foreign exchange gain/(loss) ........................................................
320
(3,762)
Finance costs (net) ........................................................................
(1,157)
(10,068)
Profit before tax
..........................................................................
77,637
28,254
Taxation charge .............................................................................
(8,272)
(8,097)
Profit for the period from continuing operations
.....................
69,365
20,157
Loss for the year from discontinued operations.............................
(24,401)
(278,787)
Profit/(loss) for the year
.............................................................
44,964
(258,630)
On a jurisdiction-by-jurisdiction basis, the Group’s revenue in 2012 as compared to 2013 is presented in the table below.
Year ended 31 December
($ thousands)
2012
2013
Egypt .............................................................................................
168,241
193,487
Yemen ...........................................................................................
14,735
69,007
Group revenue
.............................................................................
182,976
262,494
Revenue
Revenue increased by $79.5 million, or 43.4%, from $183.0 million in 2012 to $262.5 million in 2013. All Group
revenues in both periods were from the sale of oil. The increase in total Group revenues was primarily attributable to
significantly higher working interest production volumes as the Group achieved average daily working interest
production (excluding Oman, for which production is not included in Group revenue) of 19,270 boepd in 2013, an
increase of 40.9% compared to 13,673 boepd in 2012. The Group’s increased working interest production was mainly
from the inclusion of eleven months of production from Block 5 in Yemen as well as increased production from ERQ
and Abu Sennan in Egypt as a result of drilling new wells and successful workovers. Partly offsetting the increase in
working interest production and revenues was a slight natural decline in production from the BEA field in Egypt.
Average realised sales prices were $105.5 per boe in 2013, an decrease of 1.8% compared to $107.4 in 2012, further
contributing to the offset of the Group’s increased revenue.
Cost of sales
Cost of sales increased by $55.9 million, or 70.7%, from $79.0 million in 2012 to $134.9 million in 2013. This increase
was primarily attributable to significantly higher depletion expenses and operating costs in 2013, as a result of the
significant increase in the Group’s working interest production volumes. The acquisition of Block 5 in Yemen in
February 2013 contributed $48.8 million of the increase in cost of sales in 2013. This increase was primarily attributable
to higher recognised depletion expense of $80.7 million in 2013 compared to $46.7 million in 2012, resulting from the
increase in the Group’s production, as described above. The Group’s 2P reserves declined slightly in 2013 as compared
to 2012, primarily due to continued production accompanied by delays in the commencement of production in
Mansuriya, which were partly offset by positive outcomes in the Shahd-3 and Shahd SE-6 development wells in ERQ in
Egypt, and revisions in the production schedule and an increase in assumed productivity of development wells in Siba in
Iraq. As a result of the decrease in the Group’s 2P reserves in 2013 as compared to 2012, its previously capitalised
exploration, appraisal and development costs were spread over a lower level of reserves in 2013, increasing these
depletion costs. Also contributing to higher cost of sales in 2013 was an increase in operating costs, from $32.3 million
in 2012 to $54.2 million in 2013, as a result of the significant increase in the Group’s working interest production
volumes in 2013, particularly in Block 5 in Yemen.
Impairment (loss)/reversal
Impairment losses were $1.8 million in 2013, compared to $nil in 2012. These losses were due to the recognition of
