BG Group's Production Volumes Up 4%, Reserves Up 10%
Full Year Highlights
- Production volumes up 4%
- LNG total operating profit of £1.55 billion
- Earnings per share of 67.3p despite challenging economic environment
- Strong cash flow from operations of £4.9 billion
- Full year dividend increased by 10% to 12.35p
- Total reserves and resources increased by 10% to 14.5 billion boe
- Excellent progress in Brazil, Australia and the USA
BG Group's Chief Executive, Frank Chapman said, "BG Group has delivered a solid performance this year despite the challenging economic environment. The results reflect the benefit of integration across the gas chain combined with a particular focus on markets -- the hallmarks of BG Group's long-term strategy. The LNG business delivered a very strong result, while excellent progress continues to be made in Brazil, Australia and the USA, underpinning our confidence in the Group's growth outlook to 2020."
Weaker prices caused a decline in revenue and other operating income of 10%. The fall in prices was partially offset by the positive effects of 8% growth in E&P production volumes and the recovery of past gas costs at Comgás, in Brazil, resulting in a 3% fall in total operating profit to £1 108 million.
Cash generated by operations was £1 329 million (2008 £1 922 million). Net finance costs for the quarter were £36 million.
Capital investment in the quarter of £1 093 million reflected continuing investment in E&P (£724 million), LNG (£172 million), T&D (£49 million) and Power (£148 million).
Lower gas and oil prices resulted in an 18% fall in revenue and other operating income. Despite a 37% drop in Brent oil prices and a 53% fall in Henry Hub gas prices, total operating profit was 21% lower as these price declines were partially offset by a 4% increase in E&P production volumes, a strong performance from the LNG segment, the recovery of past gas costs at Comgás and the effect of a stronger US Dollar.
Net finance costs were £144 million and included foreign exchange gains of £25 million.
The Group’s effective tax rate (including BG Group's share of joint ventures and associates tax) was 42.0% (2008 42.5%) for the full year.
Cash generated by operations was £4 895 million (2008 £6 274 million). As at 31 December 2009, net debt was £2 956 million and the gearing ratio of the Group was 17%.
Earnings per share were 67.3 pence.
Capital investment (including acquisitions) in the year was £5 205 million and comprised investment in E&P (£4 226 million), LNG (£653 million), T&D (£151 million) and Power (£175 million).
In considering the dividend level the Board takes account of the outlook for earnings growth, cash flow and financial gearing. Taking these factors into account, the Board has recommended a final dividend of 6.73 pence per share, bringing the full year dividend to 12.35 pence per share, an increase of 10% compared with last year.
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