Dubai: Abu Dhabi National Energy Company (Taqa) announced a Dh2.52 billion ($687 million) net loss for 2013 on Tuesday due to a downgrading in the value of its North American oil and gas assets.
Taqa’s shares plummeted by 10 per cent — the daily limit — on the Abu Dhabi Stock Exchange in the wake of the announcement.
The Abu Dhabi government-owned energy investment company’s results tilted from a Dh649 million profit ($176.7 million) in 2012. Taqa stated that there was a one-off, non-cash impairment of Dh3.2 billion against its North American assets “due to reserve revisions and lower anticipated production.”
According to Carl Sheldon, Taqa chief executive, the impairment will not affect its 2014 investment programme when it expects to spend between $2-2.5 billion.
“The business is well positioned to prosecute projects in its existing portfolio and footprint,” he said in a conference call with reporters.
Earnings before interest, tax, depreciation and amortisation rose by one per cent to Dh13.4 billion, reflecting strong underlying cash flows and ensuring the company has more than sufficient liquidity, Taqa stated. The company’s consolidated cash on hand as of December 31, 2013 was Dh3.9 billion and it has access to Dh11 billion in unused credit lines.
Taqa also reported a drop in revenue, down 7 per cent to Dh25.76 billion compared to Dh27.78 in 2012. The Taqa board has not recommended a dividend for 2013. It paid 10 fils a share in 2012.
Taqa has investments in Canada, Ghana, India, Iraq, Morocco, the Netherlands, Oman, Saudi Arabia, the UAE, the UK and the United States. Last year, it scaled down its North American-based workforce, cutting 162 jobs. Taqa stated that its North American assets have generated higher production since implementing a more focused capital spending programme.
Taqa did not state what impact its decision last November to shelve the $12 billion coal project in Turkey had on the results. The project developed out of an agreement between the Turkish and UAE governments.
Sheldon previously said the project was shelved due to other commitments. The Turkish government has said that Taqa pulled out of the project due to “political reasons” surrounding Turkey’s stance on Syria and Egypt.
On Tuesday, a Taqa spokesperson stated that “the project remains suspended until further notice.”
Last month, Taqa announced that Sheldon will step down in April with Edward LaFehr, former head of its North American operations, taking on his responsibilities in the newly created chief operating officer role.