Rollover of Debt Covenant Test for Premier Oil on Back of Continued Renegotiations with Lenders

Premier Oil anticipates to continue rolling over debt tests until the company comes to a new agreement with lenders.

Premier Oil PLC (LON:PMO) delayed a debt covenant test that was pending based on the fact that it is still engaged in renegotiations with lenders. The company had US$2.6 billion in debt as of June 30th, 2016.

The oil firm explained that the test of their financial agreements for a 12-month period should have been conducted on the 30th of September but it has been delayed and another test will take its place for the 12-month period ending October 31st.

Premier Oil, though, expects to keep delaying the test on a monthly basis until such time as negotiations with its lenders have been finalized.

The company released interim results for H1 of FY2016 ending on June 30th in August. The results showed the firm had US$207 million in cash and equivalents, while production came in at 61,000 barrels of oil equivalent per day, which led to revenues of US$383 million over the six months in question.

Premier Oil’s had an operational cash flow of US$108.7 million, while EBITDAX for H1 of FY2016 came in at US$182 million. The company generated US$167 million in profits post-tax, which also included goodwill credit of US$106.9 million.

About the Author

George P. Burke
George co-founded Gulf Feed. He is FCA regulated, an expert in financial media and advanced web design. Formerly a full-time trader, he has a passion for stock picking and a thorough understanding of the financial markets. As managing director, he runs the US business and sits on the board of the parent company. Day-to-day he helps co-ordinate the media and investor outreach for 300 publicly listed companies. George is a member of the Institute of Directors, a director of Fuller Treacy Money Ltd and co-founder of StockTube.com and IScapital.

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