AWE (ASX: AWE) reported full-year 2013 earnings today, pushing profit back into the black after 2012 put the company in the red. On its top line, the oil and gas exploration and production company kept things fairly steady. Revenue edged up 1% to $301 million, slightly ahead of expectations, while production clocked in 6% above 2012 levels at 5.0 million barrels-of-oil-equivalent (BOE).
But the company's bottom line is what really caused investors some relief. Exploration and production is a tricky business, and profits aren't always around. But for 2013, AWE pulled in $20 million in statutory after-tax net profit, significantly higher than its $66.5 million 2012 loss. After-tax underlying profit also increased, up 15.5% to $17.1 million.
According to Managing Director Bruce Clement, AWE's boost can be attributed primarily to the company's "2P" (proven and probable) reserves. Since December 2012, AWE's 2P reserves have doubled to 110 million BOE, "representing more than 20 years of current production."
It's not all growth, though. AWE also noted its 50% interest sale last week of its Northwest Natuna Production Sharing Contract to Santos (ASX: STO). While the offshore Indonesia project has fared well for AWE in the past year, the $188 million should help keep AWE's books balanced.
Looking ahead, AWE expects 2014 to bring in $290 million to $390 million in sales from 5.0 million to 5.5 million BOE production. The corporation has earmarked $160 million to $180 million for development, and should spend around $50 million on exploration.
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Motley Fool contributor Justin Loiseau has no position in any stocks mentioned in this article. You can follow him on Twitter @TMFJLo.
