Providence loses €6.6m in half year

EXPLORATION COMPANY Providence Resources lost €6.6 million in the first half of the year, according to results it published yesterday.

The company, which is producing natural gas from wells in Britain and the Gulf of Mexico, and exploring for oil and gas off the Irish and Nigerian coasts, said revenues in the first six months of the year slipped to €10.5 million from €11.2 million during the same period in 2008.

Providence blamed lower oil and gas prices and the impact of hurricanes on production for the fall-off in sales. The company reported a net loss for the period of €6.6 million, compared with a profit of €3.25 million for the first six months of last year.

It said the loss included €7.5 million in non-cash items. It also had finance costs of €7.3 million during the six-month period, which included a €2.1 million foreign exchange charge.

Finance costs last year were €1.8 million.

However, Providence pointed out that it continued to generate surplus cash during the period, with operations generating €2.9 million and earnings before interest and write-offs coming to €5.3 million.

In June, Providence raised €17 million from British financial institutions through the placing of 431 million shares.

It will use the cash to cut its debts and strengthen its balance sheet, and to provide working capital for future investments.

Providence has bought 40 per cent of the Kinsale gas field and storage facilities from Petronas through its subsidiary Eirgas in a deal valued at $7.2 million.