Venture Global shares slump on downbeat annual core profit outlook

Reuters
03-06
UPDATE 2-Venture Global shares slump on downbeat annual core profit outlook

Rewrites throughout, updates share movement and adds details on results in paragraphs 2, 8-10

March 6 (Reuters) - Venture Global's VG.N shares on Thursday slumped to its lowest level since its debut as the LNG producer forecast its 2025 core profit below Wall Street expectations.

Shares of the company fell as much as 22.5% to $11.02 in morning trade as it forecast adjusted core profit between $6.8 billion and $7.4 billion for this year, below Wall Street estimates of $8.66 billion, according to data compiled by LSEG.

The company, which became one of the most valuable U.S. LNG companies when it listed in January, also raised its estimates for the cost to build its Plaquemines LNG plant in Louisiana by around $2 billion.

Venture Global now expects the plant to cost between $23.3 billion and $23.8 billion, compared to a range of $21 billion to $22 billion earlier. As of December 31, the company had paid about $19.8 billion.

Last month, U.S. federal regulators gave the company permission to increase the export capacity of the Plaquemines plant to 27.2 million metric tons per annum from 24 mtpa.

The capacity expansions come at a time when Venture Global is locked in contract disputes with customers such as BP BP.L, Shell SHEL.L and Edison EDNn.MI over non-receipt of cargoes due to lengthy testing and optimizing process.

Venture Global also reported a 6.6% decline in fourth-quarter revenue to $1.52 billion, hurt by 13% fall in volumes of LNG sold.

The revenue was also below the average of analysts' estimates of $1.92 billion.

The company's adjusted core profit of $700 million for the quarter was also below analysts' average estimate of $1.34 billion. But lower expenses helped the firm post a net income of $871 million, compared to a loss of $50 million a year ago.

The firm expects to export 140 to 148 cargos from the Calcasieu project and 219 to 239 cargos from the Plaquemines project this year.

(Reporting by Tanay Dhumal in Bengaluru; Editing by Leroy Leo)

((Tanay.Dhumal@thomsonreuters.com; Twitter: https://twitter.com/TanayDhumal;))

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