Richmond loses pounds 43.9m

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The Independent Online
DAVID Wilkinson has stepped down as joint managing director of Richmond Oil & Gas to head the company's Siberian operations as the controversial energy group announced a pre-tax loss of pounds 43.9m, which has wiped out 90 per cent of the company's net worth.

In June Richmond, which raised pounds 21m from a rather unsuccessful offer for sale in 1989 and pounds 31m from a misfired share placing in 1990, said it would suffer a pounds 37m loss after lenders foreclosed on its main asset, an interest in the Richmond Ranch oil and gas fields in Texas, which it bought in 1990.

The Serious Fraud Office has been investigating share dealings in Richmond subsequent to its flotation in 1989, when only 12.2 per cent of the issue was taken up.

Robert Fox, the chairman who has also now taken over as chief executive, said that lower gas prices had forced Richmond to make further provisions of pounds 6.45m on other assets, mainly a pounds 4.8m write-down of its Panhandle project in Texas.

A dispute with the Ute indian tribe of Colorado meant Richmond could only complete dollars 12.5m ( pounds 6.5m) of a dollars 20m ( pounds 10.3m) sale of its interests in San Juan Basin methane properties, which contributed to the Richmond Ranch foreclosure. Further partial sales are expected by the end of 1992.

Richmond made an operating loss before exceptional items of pounds 347,000 in the year to 31 March compared with pounds 186,000 after a gross profit of pounds 3.7m on sales of pounds 11.4m was swallowed up by pounds 3.95m of administration expenses.

End-year shareholders' funds were pounds 5.7m or 6p a share compared with a market price yesterday of 5p. In 1990 the shares were as high as 173p.

Mr Wilkinson, who was chairman of Richmond at the time of its flotation, has been appointed chief executive of Richmond Russia but remains on the main board.