SOCO International plc ("SOCO" or "the Company")

SOCO is an international oil and gas exploration and production company, headquartered in London traded on the London Stock Exchange and a constituent of the FTSE 250 Index. The Company has continuing interests in Vietnam, Yemen, Libya, Thailand and the Republic of Congo with ongoing production operations in Yemen.

SOCO today publishes the restatement of its 2004 comparative financial information from UK Generally Accepted Accounting Practices (UK GAAP) to IFRS in US dollars. With effect from 1 January 2005 SOCO will report its results in accordance with IFRS. Additionally, SOCO’s financial statements will be presented in US dollars, following the decision by the Group to adopt US dollars as its presentation currency reflecting the primary economic environment in which the Group operates.

On 27 September 2005 the Group will publish its interim results for the six months ended 30 June 2005, which will be the first results to be prepared under IFRS and in US dollars, and will include IFRS comparative financial information for the six months ended 30 June 2004. The Group will present its first annual report and accounts under IFRS in US dollars for the year ended 31 December 2005, which will include comparative IFRS financial information for the year ended 31 December 2004. The Group’s date of transition to IFRS is 1 January 2004.

Changes to the Group’s reported financial information for the year ended 31 December 2004 as a result of the adoption of IFRS are summarised as follows:

UK GAAP Conversion
to US
Dollars
Change
under
IFRS
IFRS
£'000 $'000 $'000 $'000
Income Statement
Operating profit 12,438 22,830 641 23,471
Profit after tax 15,499 28,930 641 29,571
Earnings per share (basic) 22.2p 41.5c 0.9c 42.4c
Balance Sheet
Net Assets 134,356 258,027 (10,840) 247,187


Changes arise principally due to the following adjustments:

  • IFRS 2 "Share-based Payment": The fair value of share based incentive awards is calculated at the date of grant using an option pricing model and is recognised over the performance period. Under UK GAAP, the intrinsic value of the awarded shares at grant date is recognised over the performance period.

  • IFRS 6 "Exploration for and Evaluation of Mineral Resources": Pre-licence acquisition costs have been expensed as incurred and income on the sale of exploration ventures has been recognised when realised. Under UK GAAP, these costs net of the income were included in intangible fixed assets pending determination of commerciality. Further, under UK GAAP the level at which assets were aggregated for impairment assessment was higher than under IFRS, giving rise to an additional impairment on transition.

  • SOCO has chosen to adopt the US dollar as its presentation currency in accordance with IAS 21 "The Effects of Changes in Foreign Exchange Rates". SOCO?s UK GAAP financial statements were prepared using pounds sterling as the reporting currency.



Additionally, changes in the form and presentation of the financial information have been implemented in compliance with IAS 1 "Presentation of Financial Statements", IAS 7 "Cash Flow Statements" and IAS 16 "Property, Plant and Equipment".


The full text of the Group's restatement of 2004 financial information upon adoption of IFRS is available on SOCO?s website within the Financials section. The document includes the preliminary comparative 2004 financial information for the year ended 31 December 2004 and the six months ended 30 June 2004, the opening balance sheet as at 1 January 2004, and the relevant audit and review reports addressed by Deloitte & Touche LLP to the Directors of SOCO. The document additionally includes the Group's accounting policies as revised to reflect IFRS.

23 September 2005

ENQUIRIES:

SOCO International plc
Roger Cagle, Deputy Chief Executive and Chief Financial Officer
Tel: 020 7747 2000

Pelham Public Relations

James Henderson Tel: 020 7743 6673

Charles Vivian Tel: 020 7743 6672
 
 
 
 
 
 
 
 

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