Circle eyes first dividend payout

Circle Oil — the Limerick -based exploration firm with assets in northern Africa and the Middle East — is actively considering making its first dividend payment to shareholders.

The company has been listed on London’s Alternative Investment Market (AIM) for 10 years, but is yet to reward investors by way of an annual dividend.

However, in an interview with London-based online investor news service, Proactive Investors, Circle’s chief executive Professor Chris Green said that management is contemplating the matter.

However, industry sources aren’t expecting a payment to be made in the foreseeable future; something seemingly supported by Prof Green’s own comments.

“I can see it in the future, but exactly when will be a board decision, but it is nice to be in a position to be able to think about it,” Prof Green said.

“Dividends are discussed and it is a balance of what’s in the best interests for everyone,” he added.

His remarks come just over a month after Circle published full-year results for 2013, with the strong performance highlighted by a near 30% increase in group revenue to over $93m (€69.2m) and a 15% rise in operating profit to $32.3m.

The results also revealed that cash generated from operations grew by 36% last year, to just under $53.4m, while the firm also has available cash amounting to just over $26m; nearly 40% more than was the case at the end of 2012.

Both Investec and London-based brokerage, Liberum recently reiterated ‘Buy’ recommendations on the Circle stock, suggesting the firm’s share price should end the year at a price of between 45p and 50p (it’s currently trading at just over 19p).

In recent weeks, Circle has said that it wants to further expand its presence in northern Africa — where operations are ongoing in Morocco, Tunisia and Egypt — and is also looking to drill at its onshore and offshore licences in Oman, where it will also bring in a farm-in development partner for the latter asset.

The company is also active in new licensing rounds, with Circle likely to take part in Egypt’s next licence auction and currently awaiting the outcome of a third licence bid in Oman which is the largest non-OPEC affiliated hydrocarbon producer in the Middle East.


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