Tullow Oil has moved back to the black in the first half its financial year.
The oil and gas producer booked a profit before tax of some $150 million (£114m) in the six months to the end of June, compared with a loss of nearly $558m a year earlier. Revenues were up from $788m to $905m.
The group said it was maintaining its capital expenditure guidance for the year at $460m. An interim dividend is not being paid after the group concluded that, for now, “free cash flow is best used to continue to pay down debt and to invest in assets”. A three-year cost reduction programme has delivered $708m of savings.
Founder and chairman Aidan Heavey will be stepping down having served at the company for 32 years. He will be replaced by Dorothy Thompson, who was appointed an independent non-executive director on 25 April.
Chief executive Paul McDade said: “Today’s results are further evidence of the progress that Tullow has made in the first half of 2018.
“With this firm financial foundation, we can concentrate on growth across our three core businesses.
“Over the next two years, we will increase production from our current assets in West Africa, progress two large onshore developments in East Africa and step up our search for material new oil fields in Africa and South America through a multi-year exploration campaign which will initially focus on Namibia and Guyana.”
David Barclay, head of office at Brewin Dolphin Aberdeen, said: “Tullow’s share price has risen by nearly 50 per cent over the last 12 months, much of which can be put down to the rising tide of the oil price lifting all boats.
“At the same time, Tullow has de-risked its balance sheet, raising capital in early 2017 to reduce debt and boosting cash flow from increased production.”