ORCA Exploration Group has registered a revenue drop in first quarter of this year as hydropower generated upped due to increased rainfall.
Orca, the largest natural gas supplier in the country under its subsidiary PanAfrica Energy, saw its sales revenue dropped by 11 percent to 17.7 million US dollars compared to the same prior year period.
The firm attributed the revenue drop to primarily decreased sales to TANESCO under the portfolio gas supply agreement and a smaller current income tax adjustment due to lower revenues.
“The decrease in gross sales volume was primarily due to the increase in hydropower generated due to higher than normal rainfall during the past six months,” Orca said in a statement.
Gas deliveries for the quarter decreased by 8.0 percent compared to the same prior year period, which was due to decrease sales of natural gas to TANESCO and Songas.
However, the decrease in gas sale volume was partially offset by an increase in sales to the Tanzanian Petroleum Development Corporation (TPDC), through the National Natural Gas Infrastructure (NNGI).
During the quarter under review, net income attributable to shareholders increased 356 percent to 12.6 million US dollars against similar period last year.
“The increase is primarily due to the increase in finance income related to the collection of 10.1 million US dollars of TANESCO long-term arrears,” the statement reads.
Net cash flows from operating activities decreased by 94 percent to 0.8 million US dollars from 13.2 million US dollars in previous quarter last year.
The decrease is primarily a result of the payment of the current portion of the additional profits tax liability of 11.9 million US dollars to Tanzania.
Also, adjusted funds flow from operations (1) for Q1 2020 decreased by 16 percent to 7.6 million US dollars compared to the same prior year period.
“The decrease was primarily related to a large receivable from TPDC…a majority of which was settled subsequent to the end of Q1 2020,” said Orca.
Orca, which its main activities are in Tanzania, said capital expenditures decreased by 55 percent to 0.5 million US dollars at in three months to March compared to 1.1 million US dollars similar period last year.
“The capital expenditures in this year quarter one primarily relate to the flow line decoupling construction,” The statement said.
The capital expenditures, for last year’s quarter one, was primarily relate to the refrigeration project for the Songas Infrastructure.
The statement said at end of March, the company is in a stable financial position with 82.9 million US dollars in working capital against 107 million US dollars at end of last December.
“The decrease in working capital and cash and short-term investments was primarily related to the substantial issuer bid completed in March 2020,” the statement read.
Orca is listed on the Toronto Stock Exchange and is operator of the world class Songo Songo integrated gas project in Tanzania.
The company is also pursuing natural gas development and production opportunities elsewhere in Africa.