Oil and gas exploration group Dana Petroleum posted pretax profits of £1.5 million in the six months to June, down sharply from 3.8 million a year earlier as turnover slipped to £10.4 million from £14.5 million amid falls in the price of oil.
Looking ahead, it said the outlook of the business is "bright with the expectation of rising earnings".
Dana also said it expects to exceed its production target of 15,000 barrels of oil equivalent per day (boepd) by the end of the year.
"Although average production for the first half of 2002 was some 13% lower than the same period in 2001, this will be more than compensated for in the second half as more production comes on stream," the company said. "As a result, Dana's full year 2002 revenues should show a significant increase over 2001."
Further growth in production is expected in 2003 as it lines up more exploration projects in the coming months, it said in a statement announcing its half-year results.
In the first half to June, average production totaled 5,275 boepd, with August figures rising to 8,679 boepd.
The group has obtained £75 million in new revolving credit to fund further developments.
Dana said the first results reflect "a period of lower oil prices and the fact that Dana's production has, to date, been reliant on the performance of only three fields."