(Updates with MD comment)
OSLO (Thomson Financial) - DNO ASA posted second quarter profits well ahead of consensus forecasts at both the operating and pretax levels, boosted by higher oil production and lower exploration costs, but the firm cut its average 2007 production target to reflect a slower overall pick-up in production.
Norwegian oil minnow DNO had previously said it expects oil production to increase to about 26,000 bpd by the end of the year, with an average 2007 production of 20,000 bpd.
Today it said it is maintaining its 2007 exit production target of 26,000 bopd, but its average production figure has been revised to 15,000-17,000 bopd.
In terms of financials, second quarter pretax profits came in at 187.8 mln nkr, up from last year's 112.5 mln, and well ahead of the 56 mln consensus forecast of analysts polled by TDN Finans.
At the operating level, profits came in at 233.7 mln nkr, up from 131.5 mln and ahead of the 96 mln consensus forecast.
Sales came in at 342.6 mln nkr, down from last year's 359 mln, but ahead of the 315 mln figure expected by analysts.
Exploration expenses, meanwhile, came in at 67.3 mln nkr, down from 110.8 mln last year.
Elsewhere, DNO said the sale of two license offshore Norway had contributed a profit after tax of 98 mln nkr during the second quarter.
DNO managing director Helge Eide said the quarter had seen the firm reach 'new important milestones'
'In Kurdistan the drilling results confirm the prospectivity of the area and licenses and we commenced long term test production from Tawke wells within a year from commencement of the development,' he said.
'This gives grounds for optimism going forward.' alastair.reed@thomson.com ar/lam COPYRIGHT Copyright AFX News Limited 2007. All rights reserved. The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News.