Diversified Gas and Oil rides out market volatility
Diversified Gas and Oil posted strong results todayto defy difficulties on the world commodity market.
The Alabama-based company reported an adjusted EBITDA of $273.3m (£209.8m) for 2019.
Final recommended dividend was 3.50 cents per share, an increase of 24 per cent over the same period in 2018.
Total revenue almost doubled to $511.7m, up 87 per cent from $274.1m in 2018.
“The past year has been one of significance for the Company and has seen us achieve a number of key milestones as we build upon the strong growth platform that we have created,” said boss, Rusty Hutson Jr.
However, shares in the company are down almost ten per cent, at 65.40p, as the oil price collapse today encouraged a worldwide sell-off.
90 per cent of the company’s operations are in onshore natural gas production along the Appalachian range in the US.
Progressing through 2020, 85 per cent of production is hedged, as is 64 per cent for 2021.
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According to Hutson, the company will continue with its current strategy, the core of which is to “acquire and produce at a very efficient rate.”
The results came on a particularly turbulent day for the oil industry.
Brent crude opened at $31 a barrel in London this morning, before recovering to around $36.
This was the lowest price for four years and the biggest fall on a single day since the 1991 Gulf War.
The turbulence was caused by Saudi Arabia wanting to guard its market share and entering an oil price war with Russia.
The spread of coronavirus has caused disruption in the world economy and cast doubt on demand for oil, depressing prices.
Last week, oil giant Exxon Mobil announced it would keep to its strategy of increasing output, despite the uncertainty.