Dubai: Dana Gas reported on Sunday a 15 per cent increase in full-year net profit in 2015 that it said was largely due to a one-off gain in the fourth quarter. But the continuing decline in global oil prices and a 15 per cent fall in production in Egypt meant a sharp decline in revenue and gross profit.

The company made $144 million in the 12 months to December 31, 2015 compared to $125 million a year earlier, according to its preliminary financial statement posted to the Abu Dhabi Securities Exchange (ADX).

Chief Executive Patrick Allan-Ward said this was due to a one-off financial gain in November 2015 from an arbitration settlement and sale of a 5 per cent stake in the Pearl Petroleum Company to German investor RWE. Citing a confidentiality agreement, he declined to state the amount paid to Dana Gas.

Revenue declined 38.9 per cent to $417 million compared to $683 million a year earlier and gross profit fell by 58.4 per cent to $126 million. “2015 has been a tough year with a difficult business environment and the future is continuing to look challenging,” Allan-Ward told reporters on a conference call.

Full-year production was 63, 9000 barrels of oil equivalent per day (boepd), down 7 per cent from 68,900 boepd in 2014, however, Allan-Ward said Dana Gas plans to increase production to above 70,000 boepd this year.

Production in Egypt fell 15 per cent to 33,900 boepd due to natural declines in the fields, while production in Iraqi Kurdistan increased 3 per cent to 28,500 boepd.

Dana Gas said it will seek further reductions in expenses and operating costs, particularly in Egypt, in 2016 after cutting head office personnel by 40 per cent in 2015. Though, Allan-Ward said savings are unlikely to be significant after three consecutive years of operating cost cuts.

“It is getting a little difficult to squeeze further blood from this particular stone,” he said.

In 2016, capital expenditure will be focused on Egyptian operations, however, Allan-Ward warned that “continued investment requires us to continue to get paid.” Dana Gas received $125 million from the Egyptian government in 2015 with trade receivables amounting to $234 million as of December. Allan-Ward said he still believes outstanding Egyptian receivables can be settled by the end of 2019.

In Iraqi Kurdistan, the company received $43 million from the Kurdistan Regional Government and Dana Gas’ share of receivables now stand at $727 million.