Oil and gas producer Nostra Terra Oil and Gas plc (LON: NTOG) saw their losses narrow on-year with a growth in sales. However, the increase in revenues was offset by expenses, which easily weighed down profits.
The Company’s outlook remains positive despite the surface-level headline being that Nostra Terra has booked a consecutive full-year loss. The Board remain confident in the Company’s potential and ability to grow, and they believe this round of results reflects a move in the right direction.
Though pre-tax losses for the full-year came to $0.9 million, this is a jump from their losses of $1.5 million the year before. Further, both the Company’s production volume and revenues rose with production up 22% on-year to 37,384 barrels of oil equivalent, which led revenue growth of 56% to $2.3 million.
Nostra Terra comments
In today’s statement on these results, Non-Executive Chairman Ewen Ainsworth was keen to stress the positive outlook for the Company with these comments:
“During 2018, the price of oil continued its overall upward trend, underpinning the recovery of the oil industry with an average price much higher than 2017, and although it dipped towards the end of the year, it has since recovered.”
“Nostra Terra was well positioned to benefit from this increase in the oil price. The Company’s production from the Pine Mill’s field in Texas has been stable to growing, having achieved rates well in excess of those on acquisition in 2017. This is currently the core cash flow asset for Nostra Terra and the stability, and potential to increase production, is not only a testament to the Company’s field operations but also the original acquisition itself.”
“In 2018, Nostra Terra successfully drilled two wells in the Permian Basin which had the benefit of diversifying and adding to the Company’s production base and revenue stream. The results from both these wells was in line with expectations.”
“Nostra Terra now has the enviable challenge, which successful growing companies face, of funding and managing growth. Having a solid foundation of producing assets and a proven track record provides multiple options. A sign of this transformation is that funding is not now sought to cover overheads and the cost of the management team but directly into growing the Company and seeking material step changes in value, cash flow and profit.”
“The future of Nostra Terra has never looked brighter. We have continued to deliver on our strategy to build secure, long-term, profitable production. From this solid foundation, our intention is to build on this further with material organic growth from the Mesquite asset, whilst being ever vigilant for other opportunities consistent with the Company’s strategy.”
Following the financial update, the Company’s shares rallied 4% or 0.075p in early morning trading on Monday, up to 1.95p a share 01/07/19 10:32 GMT.
Today there has also been an update from Prospex Oil and Gas Plc (LON: PXOG), and elsewhere in oil sector, there has been news from; TomCo Energy Plc (LON: TOM), Rose Petroleum PLC (LON: ROSE), Petrofac Limited (LON: PFC), Eco Atlantic Oil and Gas Ltd (CVE: EOG) and Mayan Energy Ltd (LON: MYN).