Taqa profit falls 14pc on commodity prices
Abu Dhabi, February 6, 2013
Abu Dhabi National Energy Company (Taqa), one of the largest independent power producers in the world, said its net profit for 2012 fell 14 per cent to Dh640 million ($174) from Dh744 million a year ago hit by the commodity prices and UK tax charges.
Announcing the results for the year ending December 31, 2012, Taqa said the overall gross profit declined by 7 per cent, principally due to lower production and revenues in its oil and gas business, which was affected by weaker North American gas prices.
The Abu Dhabi energy giant said the 14 per cent drop in net profits was partially due to a one-off charge restricting tax relief on decommissioning expenditures in the UK North Sea, lower North American gas prices and aluminium prices, a lower margin on back-up fuel at our UAE power stations and higher finance costs from new bond issues against repayment of maturing bonds.
Taqa reported strong operational performance with top line revenue growth of 14 per cent due to higher power and construction revenues offset by lower supplemental fuel revenues and oil and gas revenues.
The increase in total assets was primarily due to the expansion of the Jorf Lasfar project in Morocco, the construction of the Gas Storage Bergermeer project in Netherlands, an advance payment towards the acquisition of BP’s interests in oil and gas assets in the Central North Sea and the acquisition of a 53.2 per cent interest in the Atrush block in the Kurdistan region of Iraq.
The increases were partially offset by divestments of certain non-core assets in Canada and the sale of our shares in Tesla Motors and WesternZagros, it added.
Partly offsetting these declines, we recognised a gain on divestments as described above and lower impairment charges in North America.
Commenting on the results, CEO Carl Sheldon said this was a year of significant strategic achievements for Taqa across its range of businesses that position the group well for the future.
"We have made great progress against our strategic objectives of expanding our power business in the Mena region, entering Iraq and signing a MoU with the Turkish Government to develop power production and associated assets in Southern Turkey. Our expansion projects at Jorf Lasfar and Takoradi have also continued apace," he remarked.
"Our Oil and Gas business has also performed well, with a strategic acquisition in the UK North Sea securing the long-term future of what has historically been one of our most profitable geographies," said Sheldon.
"The acquisition of the interest in the Atrush field in the Kurdistan region of Iraq is an excellent example of our growing maturity as an upstream operator and our tolerance for political risk in the Mena region. The start of construction of the gas storage facility at Bergermeer is a milestone and the team also completed a second successful open season for capacity in December," he added.
On the 2013 outlook, Sheldon said Taqa was better positioned than ever to capitalise on the growth opportunities inherent in its businesses.
"Our extensive experience as an operator of complex energy assets, coupled with our strong financial position, gives us access to unique opportunities whilst continuing to optimise our existing activities," he added.-TradeArabia News Service