Rex International's Q1 loss deepens to US$8.15m

Weighed down by foreign exchange losses, higher administrative expenses as well as losses from its jointly controlled entities, Rex International Holding's net loss deepened to US$8.15 million for the first quarter ended March 31, 2015, compared to a net loss of US$2.54 million in the year ago period.

Over the same period, the oil exploration and production firm recorded revenues of US$2.07 million. No revenue was recorded in the year ago period as the group was mainly involved in exploration and drilling activities.

With crude prices trading at nearly half of its June 2014 levels, Rex is cautious of the current oil price slump but sees a "window of opportunity" of taking advantage of lower costs for seismic surveys and oil drilling services. The group adds that it is "on track" with its operational plan to drill up to 10 wells in Norway, Oman and Trinidad this year.

While financing for its 2015 drilling programme is in place, Rex said that it will continue to be prudent with its capital expenditure for drilling activities and be selective when committing to farm-in projects, after evaluating opportunities with its proprietary virtual drilling technology. The group claims its technology to have an oil discovery success rate of over 50 per cent, compared to the global average of 10-15 per cent.

Loss per share for the three months ended March 31, 2015 stood at 0.64 cents while net asset value per share was 14.25 cents. No dividends were declared for the quarter. Before its results were announced on Wednesday, Rex closed trading down 1.54 per cent at S$0.32.