Secondary Recommendation

Dragon Oil - Abandons bid for Bowleven

March 2012

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

The shares are already up a very useful 30% since we made them one of our NAPs in January. Our full write up last month was also particularly well timed. Since writing that article, Dragon has announced 2011 results, although there was little new news on what we had reported. Average daily production grew by 20% to 61,500 bopd and a higher average price of US$101 per barrel (2010: US$72 per barrel). This gave rise to sales of Â£1.15bn, pretax profit of US$871.7m and eps of 125.6 cents. Net cash at the period end was US$1.53bn, equivalent to 190p a share. The production exit rate for 2011 exceeded Dragon's target and hit 71,751 bopd up from 57,013 helped by 13 new wells drilled in the period. Looking ahead, Dragon will drill at lea ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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