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Teikoku Oil Ups Earnings Forecasts

Posted on: Wednesday, 17 August 2005, 18:00 CDT

Tokyo, Aug. 17 (Jiji Press)--Teikoku Oil Co. said Wednesday it has raised its earnings forecasts for the year ending in December thanks to record-high crude oil prices.

The firm's group net profit is now estimated at 13.8 billion yen, up from the previously projected 12.1 billion yen. The recurring profit estimate was raised to 21.8 billion yen from 18.7 billion yen, on sales of 95.7 billion yen, up from 93.1 billion yen.

Backed by the expected strong earnings, the company decided to boost its annual dividends to 9 yen per share from 7.5 yen. The annual payouts will include an interim dividend of 4.5 yen, up from the previously planned 3.75 yen.

Company officials said U.S. crude oil futures prices are seen falling back to 35-45 dollars per barrel in a few years, because supply-demand conditions are expected to stabilize and the inflow of speculative funds into the market is likely to wane by then.

Last month, Teikoku Oil was given rights to test-drill for natural gas in East China Sea waters disputed by Japan and China.

But the company has not booked a budget for the project in the current year, because the two countries have yet to settle their dispute on the demarcation of their exclusive economic zones and it is uncertain when the firm can begin test-drilling, the officials said.

For January-June, the company posted a group net profit of 8,932 million yen, up 46.4 pct from the same period last year. Recurring profit rose 49.1 pct to 14,088 million yen, on sales of 49,785 million yen, up 21.7 pct.

The earnings growth resulted mainly from the acquisition of Japan National Oil Corp.'s equity stakes in oil joint ventures in Venezuela, Egypt and Congo. The government corporation was disbanded in March this year. [EARNINGS]END

Source: Jiji Press English News Service

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