[EQUITIES] KOGAS’ Q2 operating profit to rise 417%: Samsung Securities

[THE INVESTOR] Samsung Securities forecast state-run Korea Gas Corp.’s second quarter operating profit will jump 417.3 percent on-year to 19 billion won (US$16.73 million) on improved earnings from overseas exploration and production businesses.

Revenue, however, was expected to fall 15.4 percent to 4.2 trillion won on declining sales in liquefied natural gas.

Further undermining KOGAS’ profit in the latter half of the year is its recent decision to suspend its development program in Iraq’s Akkas gas mine -- an area occupied by the jihadist group, Islamic State. The mine is estimated to be worth up to 387.3 billion in terms of book value as of the end of the first quarter.

However, an improvement in the firm’s overseas operating profit, forecast to reach 200 billion won in 2017, may help cover the losses, the brokerage said.

By Kim Ji-hyun (jemmie@heraldcorp.com)