Shares in Premier Oil (LON: PMO) plummeted 25% after the group posted a $672m loss.
Due to weak oil prices, the oil company’s revenue fell from $883.1m in 2019 to $530.6m for the first half of 2020.
“With a strengthened balance sheet and strongly rising near-term production, Premier will be well placed to start reinvesting in some of its growth projects to deliver value for all of its stakeholders,” said Premier Oil in a statement.
When markets opened, shares in the group dropped over 24%.
The group has said that it plans to preserve cash over the second half of the year.
Chief executive Tony Durrant said: “We have taken decisive action to safeguard our people and our assets. “We have reduced our expenditure which, together with our hedging programme and the continued underlying performance of our assets, resulted in us generating free cash flow for the period, despite the collapse in commodity prices. ”
“The BP acquisitions and our proposed long-term refinancing will position Premier to benefit from materially rising near-term production, additional free cash flow generation and a strengthening balance sheet, against a backdrop of a recovering oil price,” he added.
Premier Oil (LON: PMO) shares are trading -23.18% at 26,11 (1358GMT).