News Column

Green Dragon Gas Pretax Loss Widens On Costs, Expenses

June 9, 2014

Tom McIvor

LONDON (Alliance News) - Green Dragon Gas Ltd Monday said its pretax loss widened in 2013 as higher revenues were offset by increased cost of sales, administrative expenses and a change in the value of its financial derivative following the conversion of a bond issuance.

The coalbed methane gas producer in China said its pretax loss widened to USD34.8 million from USD16.8 million the previous year.

The company said its revenues increased to USD62.2 million from USD8.1 million as its total gas production rose fourfold in 2013 with third-party gas sales driving up the amount of gas developed on the company's acreage.

Its total gas production increased to 7.19 billion cubic feet from 1.78 billion cubic feet in 2012 and its total full-year standalone gas production increased 11% to 2.9 billion cubic feet, largely based on a 43% increase in fourth quarter standalone production to 722 million cubic feet.

However, the company said its cost of sales increased to USD40.3 million from USD3.9 million and its administrative expenses increased to USD29.5 million from USD13.0 million.

The company raised a total of USD135 million from the disposal of non-core assets during the period and said that GIC Private Ltd converted a USD35 million convertible bond it was issued in 2013. Green Dragon said a non-cash fair value adjustment in relation to the USD35 million bond issuance with warrants resulted in a charge of USD13.3 million during the period.

Despite this, the company remained confident for 2014, saying the it expects to achieve a target exit production rate of 18 billion cubic feet, more than double its 2013 figure.

Green Dragon Gas shares were down 2.3% to 527.50 pence on Monday.

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Source: Alliance News

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