Denison profit boost mainly due to oil, gas

Profit of Denison Mines, before extraordinary, unusual and other nonrecurring items, climbed 45% in 1987 over the previous year, and the company credits its expanding oil and gas division for the sharp earnings increase.

The company says earnings last year, before the extraordinary items, etc., were $27,259,000, on revenue of $442,220,000, up from $18,792,000 on revenue of $412,285,000, in 1986.

It adds that while there were no such items last year, extraordinary, unusual and other nonrecurring items in 1986 brought net earnings for that year to $44,632,000.

Taking preferred share dividends into account, Denison says it had a loss of $0.06 per Class A and Class B participating share last year, compared with a loss, before the extraordinary, unusual and other nonrecurring items, of 24 cents a share, in 1986.

Citing the major contribution of the company’s oil and gas division to the profit increase, Chairman Stephen Roman noted that this division benefited from average oil prices that were 24% higher than in 1986.

Among highlights for 1987, particularly for the oil and gas side of the business, Roman listed the bringing into production of the huge Vega oil project offshore Sicily last August, and the signing of an agreement in December that averted the threatened nationalization of the company’s Greek oil and gas operation.

As well, he said, the company “achieved key production criteria at the potash mining and processing operation in New Brunswick and acquired interests in two significant new uranium properties, one in northern Saskatchewan, and the other adjacent to Denison’s existing operations in Elliot Lake, Ont.”

Last year, the Denison chairman said, the company increased working capital by $103 million and also in that year reduced total debt by $121 million.